HAUWA BOOTH

M A K I N G S E N S E O F TO M O R R O W

July 11-24, 2016 Issue 07 N100

Page 8-9

Financial Freedom

Train and retrain your mind to think in a certain way. And develop the right attitudes for business.

Kogi State: Getting the facts rightIt is only logical that people are likely to make hasty and faulty conclusions when they lack access to the right information. A quick peak into facts and figures of Kogi’s monthly allocation

and internally generated revenue in relation to the State government’s wage bill - salary payment - makes the dwindling fortunes of the State quite glaring.

A comparison of the State and local government allocation between the past and present administration is illustrated in the tables on page 6.

CONTINUES ON PAGE 6

NITTY GRITTY CULTIVATE AN ENTREPRENEURIAL MINDSET

‘Create structure for your business’

The owner of Dahmos Integrated Farms, Augustine Agorua unveils the huge opportunities in Nigeria’s food sector. Page 4 & 13

Gov. Bello

What does money mean to you? What does money signify about you? How does money make you feel when you spend or save it?

Why do you spend as much as you do?

Get involved in health sector PPPs

Page 3 & 5 Page 12

Power and

money

Page 14

HAUWA BOOTH

BUSINESSYOUREALLYSHOULDTRY

Be the Queen’s Young Leader The Queen’s Young Leader Award recognises and celebrates exceptional people between 18-29 years from across the Commonwealth, who are taking the lead in their communities and using their skills to transform lives. Training, mentoring and networking, including a one-week residential programme in the UK during which they will collect their Award from Her Majesty The Queen are in the offing.

Applicants need to have proven experience of working to improve their communities locally, regionally or at a national level and be able to show evidence of their achievements. Deadline is September 4, 2016.Visit http://www.queensyoungleaders.com for more information

Grab N300,000 to start your businessFinancial Freedom is looking for 15 people with viable business plans that need seed capital of N300,000.

The business plan competition tagged The Investor will provide funding for start-up businesses or business in need of capital injection to entrepreneurs with brilliant ideas and whose business ideas show prospects of high ROI and able to create at least 2 to 4 jobs. Apart from the capital, the investor will assist by way of providing mentoring, advice on marketing strategies and consultancy for free where necessary. The investor will arrange for a mentoring opportunity with someone successful in your particular line of business.For more information visit www.financialfreedomng.com

Get start up funds Africa’s Young Entrepreneurs Empowerment Nigeria (AYEEN) 2016 hits the airwaves in a more vast and diverse way, it will be a pan-Nigerian programme

as all six geo-political zones (Lagos, Delta, Calabar, Abuja, Kaduna & Borno) are being taken into focus. Auditions will take place in these states as about 100,000 participants are being sought. 1,000 businesses will be empowered with grants, facilitated loans, business equipment, specialised skills scholarship and others.This will be a 13 episode entrepreneurial reality show that promises to be educative, informative yet entertaining. It will cut across the teeming youth aged 18 to 45 years pitching their ideas and businesses before a well sort out panel of judges. The businesses will cut across the various sectors of the economy: transportation, technology, commodity goods, manufacturing, hospitality, agriculture, waste management and so much more. Log on to www.ayeen2016.com for more information.

@ffreedomng

OPPORTUNITIES

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Publisher/Editor-in-Chief Martins Itua

Asst. Editor Evangeline Anumba

Contributors Basheer Oshodi Lloyd OnaghinonHauwa BoothOnyi Ezeayinka

Design & Editorial Consultancy Blo'comms

Financial Freedom is a trade mark registered under Impact Business Alliance Limited, Abuja. RC No. RC510901. All rights reserved.

Vision To be Nigeria's most trusted source of financial and business advice.

Mission To seek to change the mindset of people towards financial planning and investment and ultimately to help them take control of their financial future.

Read more at financialfreedomng.com Advertise or contribute: +234 817 856 3094 +234 815 826 3725 Email: info@financialfreedomng.com www

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Stuck in the mud in making financial choices, not sure if you should invest or not?Not sure the business will yield money, not sure if you should leave your job and start a business or retirement plan?Present your case clearly, ask for what you want and get it answered and published.

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Send a mail toinfo@financialfreedomng.com or SMS 08158155952. For confidential financial advice, call 07034525195.

Be like a duck, paddling and

working very hard inside the water, but what everyone sees is a smiling and calm face. - Manoj Arora

Most of the important things in the world have been accomplished by people who have kept on trying when there seemed to be no hope at all. - Dale Carnegie

Financial Freedom

No matter how hard you work, you never seem to have as much money as you need. And you’re wondering how on earth you could ever become rich. There’s a chance you may be falling into one - or more - of these 6 traps that can sabotage even the best money management plans.

1. You’re in debtDebt is one of the biggest drains on financial success. It’s very easy to get into debt, and once you are in, it can take decades to pay off. No purchase is worth spending the rest of your life paying it off. Do everything in your power to avoid being in debt. If you are in debt, do everything to pay off. Rather than going into debt to pay for a grand ceremony make the trade-off. You may just need to skip your birthday or wedding celebrations this year.

2. You don’t have a budgetIt’s impossible to become financially successful without a budget. Budgeting is money management, and without it, you won’t have any solid idea where your money is going. And where you might be

wasting it. Sit down and figure out all of your monthly expenses, then take a long, hard look at them to determine which expenses need to be trimmed or cut. Once you’ve got a solid budget worked out, track your spending and ensure you stick to it.

3. You’re not savingSaving for the future is essential. You should have approximately 3-6 months’ worth of income saved in case of emergencies. Consistently put money aside for long-term goals like retirement, children’s education, or putting a down payment on a home. If you don’t save for these things now, you could find yourself borrowing in the future in order to finance them.

4. You’re not a savvy shopperDo you buy things on impulse? Grocery shop without a list? Give into sales pressure even if you don’t technically need something? All of these chip away at your ability to build a positive net worth.Discern whether something is a want or a need. Do a shop price comparison for items you need.

Whenever possible, put big items on a 30-day ‘wait list’ to make sure you’re not giving into impulse. And track any potential sales to see if you can get them cheaper.

5. You’re giving in to lifestyle inflationRaises and promotions won’t do you much good if you turn around and spend that extra money on a bigger, costlier lifestyle. Rather than seeing extra income as an excuse to spend, put it to use by investing it or adding it to one of your savings goals.

6. You’re not insuredIf you don’t have proper insurance coverage you’re playing a risky game with your money. Spending a little money on monthly payments now is more than worth it in the event the unexpected happens. Make sure you have adequate coverage when it comes to health insurance, life insurance, automobile insurance and renter’s or homeowner’s insurance.Hopefully, you’ll never have to use it. But if you do, you’ll be glad you’re covered

6 reasons you are financially trapped

The Queen’s Young Leader Award

Be aware of the traps that can sabotage even the best money management plans

Issue 07July 11-24, 2016 Financial Freedom

03LINERS

LINGUAWhy you spend as much as you do Ff

The biggest factor in your financial success isn’t the size of your salary - it’s you. More specifically, it’s the

emotions that drive you to handle money the way you do: whether you hide away every penny, spend like crazy, obsess over every purchase, or simply stick your head in the sand.Understanding what drives your behaviour when it comes to money is key to your well-being; financial and otherwise. What does money mean to you? What does money signify about you? How does money make you feel when you spend or save it? If you’re completely driven by the idea that money equals security, for example, you may feel perpetually hopeless or panic-stricken that you don’t have enough saved up. And couples who have opposite money habits are bound to find themselves locked in endless conflicts-unless they can unchain themselves from the fear or need that’s driving their behaviour.So what makes one person a miser and another a spendthrift? Most of us are actually a combination of types with one prevailing trait. For example, you might be a diligent saver by nature but still have it in you to splurge now and then. And that plurality makes sense, considering our money personalities are shaped by a host of factors, starting way back from childhood. Check out the six money personalities here to find the style that best reflects your own traits.

The hoarderWhereas others see money as a means to buy nice things, hoarders see it as a means to obtain security. Indeed, no matter how much a hoarder has,there’s the irrational fear that one false move or unexpected disaster will lead to poverty. The hoarder’s strength lies in easily living within their means, sticking to a budget and a they are master bargain hunters.However their weakness is focusing on a secure tomorrow and then often fail to enjoy today. They are conservative with savings.

Your strategy: To improve your financial future, allow yourself a small luxury or move a small portion of your savings into stocks rather than keeping it all in a low-risk, low-return bank account. Start with a balanced or equity income mutual fund. These contain a mix of stocks and bonds, so they are less volatile than an all-stock fund. Seeing that such ‘risky’ behaviour doesn’t necessarily lead to disaster will help you become more comfortable with exploring other investment options that can grow your

nest egg and allow you to enjoy your hard-earned money.

The spenderBuying stuff is a balm that helps spenders feel important, loved, and validated. That need for love or approval often comes from having parents who were emotionally withholding. They endured childhood deprivation. Spenders inner voices tell them, “I deserve this, I won’t be denied anymore.” The biggest spenders are status seekers who equate extravagant possessions with self-worth. Whether or not they can afford it, that luxury car makes them feel respected. Nevertheless, their strength is they know how to live in the moment and enjoy life and

often the first to pick up the bar tab or go for a gift that makes a friend or mate feel special. Their weakness then is that they tend to over indulge and exceed their means, they hate to save, which could spell disaster in retirement or in a financial emergency.

Your strategy: To get your spending under control, you must first tackle the insecurities that drive your habit. Stop filling every emotional hole with things and build self-esteem in other ways. Try volunteering or taking up a sport or hobby. Taking control of your financial life could prove the biggest boost of all. The first hurdle is telling yourself that you don’t need to spend to prove to yourself and other people that you’re doing well. With persistence, you can break out of that. On a practical level, you must set and stick to certain limits. Keep a diary of all your expenses for a month so you can see where you’re leaking cash and cut back. Devise a budget, then put away your credit cards and give yourself a weekly cash allowance to avoid overspending. And if you’ve got serious debt and can’t afford to pay more than the minimum due, seek a financial adviser to help you.

The bingerA binger is really two types: hoarder and spender, in one. Bingers long for security, so they put money away, but then the itch to indulge sabotages their efforts. For example, after being so good at saving, they - all of a sudden - spend it or just blow it on vacation. Binging is just another form of overspending, and like spenders, bingers are driven to splurge by the need to feel approved of, a need that comes in powerful waves. They usually keep their spending under control, but in a weak moment they make an extravagant purchase that refills the emotional tank and empties the bank account.

Their strength is being on the right track toward a good, balanced financial style, they have the instincts of a saver; and keep an eye on their money. Their weakness however is when the spending mood strikes, they don’t just dip into their wallet, they empty it. Their I-have-been-good-about-saving-so-I-deserve-to-splurge-every-now-and-then mentality feeds their binging cycle.

Your strategy:The best plan for a binger is to institute spending limits without depriving yourself completely. Instead of going on a N100,000 shopping spree, reward yourself with something special that doesn’t cost a lot. When you do shop, set a spending limit, and take only that much cash with you (yes, cash!). Another tactic: Distract yourself from spending.

3Hoarders view money as a means towards obtaining security. For them, one false move or unexpected disaster will bring poverty! They focus on a secure tomorrow and often fail to enjoy today.

Spenders feel important, loved, and validated when they buy stuff. Biggest spenders are status seekers who equate extravagant possessions with self-worth. They hate to save.

Bingers long for security, so they put money away. Binging is just another form of overspending. When the spending mood strikes, they don’t just dip into their wallet - they empty it.

The worried are distraught over every money move they make - no matter how much money they have. Money concerns consume them. Taking so long to make financial decisions, they miss out on opportunities.

Money monks were raised with deep religious or political convictions that money is the root of all evil. They often shortchange themselves and put their financial security at risk. They avoid planning for the future.

To money masters, cash is simply a practical tool for living. They upgrade their lifestyle as their income grows. They are reluctant to turn to others when they need financial advice.

TAKE AWAYS

Human capitalHuman capital is a measure of the economic value of an employee’s skill set. This measure builds on the basic production input of labour measure where all labour is thought to be equal. The concept of human capital recognises that not all labour is equal and that the quality of employees can be improved by investing in them; the education, experience and abilities of employees have economic value for employers and for the economy as a whole.

Economic valueThe worth of a good or service as determined by people’s preferences and the trade offs they choose to make given their scarce resources, or the value the market places on an item. Economic value is represented by the maximum amount a consumer is willing to pay for an item in a free market economy, or the amount of time an individual will sacrifice waiting to obtain a government-rationed good in a socialist economy. In contrast, market value represents the minimum amount a consumer will pay. Economic value thus often exceeds market value.

Hard skillsHard skills are quantifiable capabilities required for specific occupations. They are the opposite of soft skills.Careers require practitioners to have certain practical and personal abilities. Hard skills are the practical abilities learned through education and training. For example, the hard skills that an accountant would need include arithmetic, familiarity with generally accepted accounting principles, and financial statement preparation. An individual seeking work typically lists his or her hard skills as part of a resume. It is important to know the difference between hard skills and soft skills, which are innate social skills related to one’s personality.

Hard money loanA hard money loan is a short-term loan that uses the value of real property owned by the borrower as its collateral. A hard money loan provides money for short-term expenses. A hard money lender provides the loan as long as the borrower is willing to pledge a piece of real property as collateral against any default.

Financial FreedomIssue 07July 11-24, 2016

CONTINUES ON PAGE 05

Check out the money personalities that reflect your own money traits

The JourneyThe journey to being a farmer started when I was in university. While at university, I used to travel from Abia State University to University of Nigeria, Nsukka. On one occasion, my friends and I were hungry in the evening and went to buy ‘fries’. Then I realised that ‘fries’ were actually made from yam and plantain. And students often trooped in numbers to buy. Then it occurred to me that I could do something like that in my university to make extra money. That idea metamorphosed into a restaurant. Before then, I had made an investment in gold. Back in the 1990s, it was in vogue for women to gold from Saudi Arabia to resell in Nigeria. I invested about N30,000 in the business and in four months, I made a profit of about 35 per cent from the business. That formed the capital I used in starting the restaurant business. Before opening the restaurant, I had realised that everybody planned to eat and always made a budget for it. When we started the restaurant, many students came to open account with us and deposited money in order to secure their everyday food. At the beginning of every semester, I had lots of cash from students who wanted to secure food for the month or the semester. While running the business, I often faced challenges in sourcing meat, chicken, vegetables, etc.

My foray into palm oil businessAfter graduating in 2000, I continued to run the restaurant business on campus. The shop generator developed a fault and I needed to fix it. The engineer I called to fix it took me to see person who had trained him in the business. It happened that he used to fabricate machines used in producing palm oil. From there, I leased a palm

plantation and started a palm oil producing mill. By reinvesting the proceeds from the restaurant, I made much progress and produced the best palm oil in the entire eastern Nigeria. Due to the high quality of the palm oil, people often bought it and mixed it with other oil they bought from other producers.

Early mistakes and stressI made a great mistake when I travelled to Accra and needed to spend some time for personal business. When I returned, the oil business had folded up because the manager who I had hired mismanaged company funds and ran the business aground. I learnt the hard lesson that you don’t leave your business in the hands of people. It was also becoming tough to successfully manage the restaurant as I was hardly around. So I decided to sell the restaurant and shut down the palm oil factory after about six months. This taught me a great lesson about doing and managing business in Nigeria. Then I had a very long period of inactivity, stress, being broke and thinking about failure. After these lean times, I started to toy with the option of going into food production. This led me to start investigating the food chain where the opportunities were. Finally, I discovered a niche area and that was how we started a cat fish farm in 2004.

I needed to train and up-skill myselfI went for training on the psychology of the fish and how to run a successful fish farm. I consulted my friend who is a veterinary doctor and I kept studying about fish farming.

The more I studied, the more I realised that it was good business because everybody ate fish. I started out with a small fish farm in Aba in order to test the market. I discovered that there was a huge supply gap in the cat fish market. I then moved to Abuja in 2008 where I had 12 trampoline ponds. But I had problems in sourcing for water for the fishes. I solved this by looking for a large piece of land in Kuje close to a river and expanded gradually to where the fish farm is today.

Improving selfI have travelled to Songhai

in Benin Republic and Cross River state in Nigeria, in order to improve myself and learn the rudiments of running a successful fish farm. The trainings focussed on poultry, fish farming, etc. At the end, I completed a one month intensive programme on poultry and cat fish farming. Through experiences, interactions, studying and exposure, I have built friendships and partnerships with people who have had farms for a long time.

The 120-ton fis farmWe have a capacity for 8,000 laying birds, all in cages and brooding pens for another 7,000. We have a feed mill and 14 mini-ponds with a capacity of between 1,200 to 1,500 cat fish per pond. We have three dams which have a total capacity of 66,000. We will be able to conveniently do about 120 tons of fish per annum in batch formulas. And that’s huge.

04

Augustine Agorua of Dahmos Integrated Farms shares his huge poultry and fish farm story and the huge opportunities in Nigeria’s food sector.By Evangeline Anumba eanumba@financial freedomng.com

RISE OF THE ENTREPRENEUR Issue 07July 11-24, 2016 Financial Freedom

QUICKLOOK

Agorua

‘Create structure for your business’

CONTINUES ON PAGE 13

Started off by selling ‘fries’ - a yam and ripe plantain delicacy - while in university.

Bought and sold gold in the 1990s. He invested N30,000 and made a profit of about N10,500 in four months,

His ‘fries’ business metamorphorsed into a restaurant in school - where students deposited money ‘to secure their everyday food’ at the beginning of every semester.

Upon graduation in 2000, he leased a palm plantation where he produced the best palm oil in the entire eastern Nigeria.

Sold his restaurant and closed his palm oil factory after it was mismanaged by a manager.

Started his cat fish farm in 2004 in Aba and moved it to Abuja in 2008. His Kuje, Abuja farms can do about 120 tons of fish per annum in batch formuas!

Jason’s leg was broken when he was hit by a car while trying to buy corn from the woman by the road side. He’s in his 30s and has not saved enough. His bill at the hospital took a whole chunk of his savings. Coming out from the hospital, he was left with just N150,000 in his account. The sad part, he couldn’t work anymore to sustain himself. After two months, he was left at the mercy of his family - to take care of him.

Victim of circumstanceLife is a risk: breathing, going out in the morning. Anything can happen at any time and when you are not stable enough to withstand the cruel ups and downs of life, you will fall. And may be swallowed up by the ground. Planning is essential and that is why insurance is important. Many Nigerians do not insure their cars until accidents occur. When the car gets damaged, they shake their heads in regret - for their loss. Some do not also insure their homes against fire or burglary until it happens.Accidents can and do happen. That is why they are called accidents. If you are not amply insured, it might leave you financially incapacitated. You need to protect yourself. Your ability to work and earn income to keep living and building is what makes insurance critical.Being insured is basically

managing risk. You simply transfer the cost of potential loss to the insurance company. Insurance helps you protect your home, your car; helps you maintain your standard of living. In case you become critically ill or even disabled, or in death, it provides for your family. It covers your health care costs. Working through life to build wealth, insurance is needed to protect your possessions, income and cater for your family in the case of untimely death. A few examples are health insurance, property/car insurance, life insurance, etc.

Permanent disability InsuranceAsk yourself, can I survive without a pay cheque? For all earners, a fundamental risk management strategy is getting a permanent disability insurance. Your most precious asset is

your ability to earn money. So, questions about how you will survive if you are disabled today is pertinent.

Life insuranceFor a sound financial plan, life insurance is necessary. It is even more important if you have dependants, as they are covered should you suddenly drop dead. It is hard for a family to bear the loss of their bread winner, but it is even harder when they have no source of income to cater for them.

Property insuranceFor many, a house is the greatest asset. Insuring it, in case of accident, disaster, fire or burglary is always a wise decision. There is also a renters insurance which insures the property in a house against burglary, fire, etc. It

05

By Danladi Usman

DIGGING DEEP

Manage risks appropriatelyMake the decision to be secured against unforeseen circumstances.

The worried You lie awake at night fretting that you won’t have enough money to cover the month’s bills. Financial decisions paralyse you. You buy a car, then agonise for months, certain you should have waited a bit or just buy the cheaper one.Everyone worries about their finances at one time or another, but worriers are distraught over every money move they make - no matter how much money they have. This obsessive concern can stem from a lack of confidence in handling money, from being a perfectionist, or from parents who were frugal to an extreme.Their strength? Their finances won’t suffer neglect. They stay off money trouble. They are more likely to use a financial adviser, who can help to better manage their money. Their weakness? Money concerns consume them. Taking so long to make financial decisions, they miss out on opportunities.

Your srategy: A few steps to help you feel safer about

your present and future finances. Each day, write down your worries and the worst that could happen if they come true. Seeing your fears on paper will help you feel more in control. Ask friends to recommend a financial planner who can confirm that you’re making smart money moves - or point you in the right direction. And once your budget is set, review your finances not more than once a month.

The money monkYou’d never ask for a raise - needing money makes you feel greedy.You believe the desire for money chips away at people’s moral values, so you try to avoid dealing with your finances as much as possible. When you have a windfall, you can’t wait to get rid of it, so you donate to charities or help cash-strapped friends.Handling money in any way makes a money monk feel like she’s giving in to its seductive power. Often, money monks were raised with deep religious or political convictions - their parents taught them that money is the root of all evil. Their strength is always focusing on ‘the more

important things in life.’ They have deep values and are capable of great generosity. Their weakness is they often shortchange themselves. They put their financial security at risk. Also, their aversion to money causes them to neglect routine money chores, so they avoid planning for the future.

Your strategy: Remind yourself that money isn’t all bad - it allows you to keep a roof over your head, help friends, and support charitable causes. Think of Bill Gates and Warren Buffett, who have donated billions of dollars to global-health and education initiatives that have literally change the world. To make dealing with money easier, put your finances on autopilot. Have pay checques deposited directly into your bank account, and set up automatic deductions for monthly bills, savings, and investments.

The money mastersYou set aside a percentage of each paycheck for savings. You thoroughly research your investment options, but don’t lose sleep over whether you picked

‘the best’ mutual fund.To money masters, cash is simply a practical tool for living. Chances are, their parents were also money masters. Or they became masters after curbing overspending habits or easing up on hoarding tendencies. With strength in savings and investng for long-term goals, have a treat without overspending. They upgrade their lifestyle as their income grows. However, their weakness is that they may feel justified in giving their friends unsolicited financial advice, which can strain friendships. They are also reluctant to turn to others when they do need financial advice - as they feel they are supposed to know it all.

Your strategy: Although it’s noble to want to ‘rescue’ your spendthrift friends, remember that you’re already leading by example. Let them come to you for advice. And even though you take pride in finding your own investments, it doesn’t hurt to consult an expert when you’re about to make major financial decisions.

Why you spend as much as you doCONTINUED FROM PAGE 3

QUICKLOOKPlanning is essential and that is why insurance is important.

Your ability to work and earn income to keep living, is what makes insurance critical.

A fundamental risk management strategy is getting a permanent disability insurance.

For a sound financial plan, life insurance is necessary.

Insuring your house, and household equipment against fire and burglary to cover replacement costs.

Insurance, not positive thinking may save you from calamities in business.

basically covers the replacement costs.

Business insurance Positive thinking may not save you from calamity happening to your business. For example, if you come to work one morning and find that all your computers had been stolen, or damaged by fire, how do you recover from that?It is important that you make the decision to be secured against unforseen circumstances.dusman@financialfreedomng.com

Financial FreedomIssue 07July 11-24, 2016

ANALYSIS06

The total population of civil servants in Kogi State as of 2013 was said to be a little above 24,000 workers. Three years after in 2016, the figure recorded a 61.5 per cent increase to 39,000 workers -1.1 per cent of 3.5 million inhabitants of the Confluence State. When these figures are summed up with the local government staff, they make up just about 3 per cent of Kogi state population. Yet such a little percentage consumes all of the State’s monthly allocation and internally generated revenue, and seek for more!However, facts and figures show that a large part of the civil servant’s population are made up of ghost workers. Such an instance has been given in the case of a single individual having bank verification number (BVN) linked to 40 accounts implying that that person receives the salary of 40 workers put together, all alone!Such level of corruption and apparent cruelty, informed the need for the screening exercise for all the workers in the state aimed at fishing out ghost workers and thereby reduce the overall wage bill for the state that for long has been to the benefit of a few corrupt fellows feeding fat from the salaries of non-existing workers.The fact that many principal officers have been implicated in the corrupt practice of enjoying the benefits of ghost workers, made it imperative to temporarily suspend all of them so as to ensure a screening free from manipulations and manoeuvres aimed at scuttling the process and covering corrupt tracks.More so, the N20bn bailout fund released by the federal government is not a grant as erroneously believed in some

quarters. It is actually a loan with the federal government standing as a guarantor, and helping to slash the interest rate from 26 per cent to 9 per cent. With the knowledge that generations to come will have to partake in the repayment of the loan, the governor is ensuring that the money doesn’t find its way into the pockets of greedy individuals, but rather be put to judicious use, further buttressing the need for the said screening.The result of the screening exercise hasn’t been completed yet. However, in view of the wave of economic hardship being faced by the people of the State, the administration of Yahaya Bello directed that any ministry that has completed the exercise should immediately pay staff under its employ. This is to debunk the rumours making the rounds that there was an ongoing scenario of selective payment to some while leaving others out. When the screening is completed, workers not cleared will be notified of any discrepancies noticed and be directed to the appropriate quarters for rectification.Furthermore, the administration, while ensuring that civil servants maintain its top priority has directed that they be paid first, the backlog of salaries being owed by the previous administration - four months - before political appointees. As a matter of fact, at some point I was being owed three months’ salary, and only 50 per cent of my furniture allowance was paid.To manage a state in dire need of quick aid with such meagre resources requires a leader with vast experience, political will and zeal as well as the good interest

of the people at heart. The executive governor of the State, Yahaya Bello, with his renowned business acumen and a vast wealth of experience in the civil service has shown his readiness to take on the daunting task of running the State’s affairs head on. By implementing austerity measures and seeking alternative sources of generating internal revenues while strengthening existing ones, he is gradually salvaging the pitiable condition of the State he inherited from the past administration.Some of such austerity measures include the reduction of the total number of ministries to 15 from 20. Similarly, the previous administration had a total of about 610 special advisers and senior special assistants. Currently, the total number of SAs and SSAs including chairmen of boards, commissions and commissioners are less than 50!One location for revenue from agricultural produce hauled through Kogi state hitherto was generating only N2m to the State. A clique was helping themselves to a princely sum of N11m monthly in what was crookedly termed taking care of the boys. Today, the entire N13m comes to government’s coffers and certainly will rise above theN20m mark in the months ahead. These, and a host of other economic indicators, make it obvious that we are on the right track. The current administration is poised at returning Kogi State to its lost glories.Dr Audu is the honourable commissioner for health, Kogi State

Kogi State: Getting the facts rightCONTINUES FROM COVER

QUICKLOOKKogi state received an average of N2.19bn as monthly allocation from the federation account for the first six months of 2016.

Kogi’s total monthly allocation of N13.1bn for the first six months of 2016 is N3.5bn less than its wage bill for same period.

There is the case of a civil servant having a BVN linked to 40 accounts implying that that person receives the salary of 40 workers put together!

The N20bn bailout fund is a loan guaranteed by the federal government - helping to slash the interest rate from 26 per cent to 9 per cent.

The total number of ministries has been reduced to 15 from 20. The 610 government appointees and functioaries has been reduced to less than 50.

Kogi State governor, Yahaya Bello

A comparison of the State and local government allocations (Tables 1 and 2 from left) and the table showing the allocation versus wage bill in Kogi state for the year 2016 on the far right.

Issue 07July 11-24, 2016 Financial Freedom

By Dr. Saka Haruna Audu

RECEPTIONIST As a receptionist you will be the first point of contact to our guests. It is your foremost responsibility to compassionately greet all incoming guests, assist them with information that they need while maintaining high level of professionalism. You will be professionally answering phone calls in a polite tone and re-directing calls to respective departments if requested. Also as the receptionist, you will perform various front desk duties including checking guests in and out, handling payments and dealing with cash flows. You will also be responsible for effectively manoeuvring any complaints, as well as having the responsibility of ensuring a smooth day to day run during your shift.

RESPONSIBILITIES• Checking guests in and out• Answering phone calls • Direct guests to appropriate

destination• Liaising with other colleagues

effectively• Receive payments, record

receipts for services and handle and reconcile all petty cash daily

• Take and resolve complaints from customers

• To support the mission, vision and core values of the company

• May be required to perform basic clerical duties, such as faxing office notes and photocopying.

REQUIREMENTS• Education: A minimum of a high

school diploma/A levels• Experience: 1-2 years of related

experience. (experience in a customer service role desirable)

• Excellent talent to interact with people in a positive and courteous manner

• Strong written and verbal communication skills

• Ability to prioritize tasks according to importance in a fast paced environment

• Multi-tasking capability without compromising on quality

• must be proficient in handling office equipment including complex multiple lined telephones, computers, printers and photocopy machines etc

• Dependable, punctual and able to work in flexible working hours.

Full training will be provided.

FRONT OFFICE MANAGERReporting to the General Manager,

the Front Office Manager directly supervises all front office personnel and ensures proper completion of all front office duties. Directs and coordinates the activities of the front desk, reservations, guest services, and telephone areas. Prepare monthly reports and budget for front office department.

RESPONSIBILITIES• Trains, cross-trains, and retrains

all front office personnel.• Schedules the front office staff’s

shifts and duties.• Supervises workload during

shifts. • Evaluates the job performance

of each front office employee.• Maintains working relationships

and communicates with all departments.

• Maintains master key control.• Verifies that accurate room

status information is maintained and properly communicated.

• Resolves guest problems quickly and efficiently.

• Checks cashiers in and out and verifies banks and deposits at the end of each shift.

• Conducts regularly scheduled meetings of front office personnel if required.

• Wears hotel uniform at all times. Requires all front office employees to wear hotel uniforms at all times.

• Maximise room revenue and occupancy by reviewing status daily. Analyse the rate variance and maintain close observation of daily house count.

• Monitor selling status of house daily.

• Ensure implementation of all hotel policies and house rules.

• Operate all aspects of Front Office computer system, including software maintenance, report generation and analysis.

• Prepare revenue and occupancy forecasting.

• Ensure that employees are, at all times, attentive, friendly, helpful and courteous to all guests managers and other employees.

• Monitor all VIP’s special guests and requests.

• Maintain required pars of all front office and stationary supplies.

REQUIREMENTS• Education: a minimum of a

College Diploma• Experience: 1 year of Front

Officer Supervision. (Or experienced in a customer

service supervisor role)• Excellent talent to interact

with people in a positive and courteous manner.

• Strong written and verbal communication skills.

• Experienced in handling cash, accounting procedures and general administrative tasks

• Must be able to manage a team without compromising on other workloads.

• Dependable, punctual and able to work in flexible working hours.

Full training will be provided.

ACCOUNTANTResponsible for the general accounting function including preparing journal entries, maintaining balance sheet schedules and account and bank reconciliation. Must be attentive to detail with accounting tasks in order to ensure a smooth run and overview of the organisation’s in and outs.

RESPONSIBILITIES• Prepare journal entries• Complete general ledger

operations• Monthly closings and

preparation of monthly financial statements

• Reconcile and maintain balance sheet accounts.

• Draw up monthly financial reports

• Prepare analysis of accounts as requested

• Assist with year-end closings• Administer accounts receivable

and accounts payable• Assist in preparing budgets and

forecasts• Assist with payroll

administration• Monitor and resolve bank issues

including fee anomalies and check differences

• Account/bank reconciliations• Review and process expense

reports• Assist with preparation and

coordination of the audit process• Assist with implementing and

maintaining internal financial controls and procedures.

EDUCATION AND EXPERIENCES• A minimum if a Bachelor’s

degree or equivalent• Knowledge of accounting

principles and practices • Knowledge of financial

reporting• Knowledge of local, state

and federal laws regarding accounting and finances

• Technical accounting skills • Previous experience of general

accounting• Proficiency in relevant

accounting software

KEY COMPETENCIES• Attention to detail and accuracy• Planning and organising • Scheduling and monitoring• Communication skills • Problem analysis and problem-

solving skills • Initiative• Team work• Confidentiality

Full training will be provided.

HOUSEKEEPERRESPONSIBILITIES• Prepare journal entries• Complete general ledger

operations• Monthly closings and

preparation of monthly financial statements

• Reconcile and maintain balance sheet accounts.

• Draw up monthly financial reports

• Prepare analysis of accounts as requested

• Assist with year-end closings• Administer accounts receivable

and accounts payable• Assist in preparing budgets and

forecasts• Assist with payroll

administration• Monitor and resolve bank issues

including fee anomalies and check differences

• Account/bank reconciliations• Review and process expense

reports• Assist with preparation and

coordination of the audit process• Assist with implementing and

maintaining internal financial controls and procedures.

EDUCATION AND EXPERIENCES• A minimum if a Bachelor’s

degree or equivalent• Knowledge of accounting

principles and practices • Knowledge of financial

reporting• Knowledge of local, state

and federal laws regarding accounting and finances

• Technical accounting skills • Previous experience of general

accounting• Proficiency in relevant

accounting software

•

KEY COMPETENCIES• Attention to detail and accuracy• Planning and organising • Scheduling and monitoring• Communication skills • Problem analysis and problem-

solving skills • Initiative• Team work• Confidentiality

Full training will be provided.

COOKAn experienced cook to prepare delicious and authentic meals according to menu. You will be required to cook dishes that will delight our customers with their taste and timely delivery. As an excellent cook, you must be able to follow instructions in cooking and delivering well-prepared meals. You should be deft in moving around the kitchen with excellent multi-tasking skills. A further necessity is that you must be able to work with various ingredients and cooking techniques. The goal is to help preserve and enhance our reputation so we can expand our clientele at the Cullen Hotel.

RESPONSIBILITIES• Set up workstations with all

needed ingredients and cooking equipment

• Prepare ingredients to use in cooking (chopping and peeling vegetables, cutting meat, etc.)

• Cook food in various utensils or grillers

• Check food while cooking to stir or turn

• Ensure great presentation by dressing dishes before they are served

• Keep a sanitised and orderly environment in the kitchen

• Ensure all food and other items are stored properly

• Check quality of ingredients• Monitor stock and place orders

when there are shortages.REQUIREMENTS• Proven experience as cook• Experience in using cutting

tools, cookware and bake ware• Knowledge of various cooking

procedures and methods (grilling, baking, boiling etc)

• Ability to follow all sanitation procedures

• Ability to work in a team• Very good communication skills• Excellent physical condition and

stamina• High school diploma or

equivalent

07

URGENT VACANCIES

Financial FreedomIssue 07July 11-24, 2016

JOB TITLE DEPARTMENT SALARY VACANCY RECRUITMENT DATE VACANCY CLOSING DATE

Receptionist Front Desk/Reception Negotiable 1 ASAP July 23, 2016Front Desk Manager Front Desk/Reception Negotiable 1 ASAP July 23, 2016Accountant Accounting Negotiable 1 ASAP July 23, 2016Housekeeper Housekeeping Negotiable 1 ASAP July 23, 2016

Cook Resturant Negotiable 1 ASAP July 23, 2016

No.15 Abubakar Kigo Road, Off Constitution Road Kaduna North, Kaduna

PLEASE NOTE: For all positions please e-mail CVs to info@thecullenhotel.org

The Cullen Hotel Kaduna

Developing the right mindset is crucial to succeeding in business. Business

success is often a result of different actions and habits that an entrepreneur develops over time and in the course of business operations. There is no such thing as accidental success in business. While working in an organisation, you are often unaware of the hard decisions that your employer makes in order to make his business continuously viable and profitable. In most cases, successful entrepreneurs will need to keep looking for ways and means to validate their value propositions and product offerings in order to stay ahead of competition.

To succeed as an entrepreneur, you will need to deliberately cultivate and retrain your mind to think in a certain way. In reality, employees and employers think differently. While an employee’s primary concern is earning his pay cheque, an employer is often more concerned with the profitability of his business. When an employee goes on holiday, there are hardly worries about the business because prevailing concerns are about having a great time. Employers and entrepreneurs often have to carry their work with them wherever they go and most times, are unable to take time off for holiday, especially at the outset. Employees will give the slightest reason to not show up at work and are happy when public holidays abound. An entrepreneur, who wants to

succeed in his business will be at work even when unwell, unless it becomes absolutely necessary. Ultimately, it is you, the entrepreneur who has taken the risk and invested in the business and you must always bear that in mind.

It is absolutely vital that you develop the right mindset and attitudes if you must build a viable and successful business. Nobody is born an entrepreneur, hence we all must take the time to learn and internalise the seven attributes explained below.

Develop an unquenchable spirit For any entrepreneur to succeed, inner resilience must be developed and cultivated. Starting or running a business successfully is not expected to be easy. If the reason for starting your business is because you want something easier, then you must have a rethink. The road of the entrepreneur is filled with hurdles, disappointments, failed promises and broken contracts. But in all, you must develop a spirit that cannot be defeated. You must be resolutely determined to be invincible, no matter what. In your quest for success, it must be clear from the start and you must continually remind yourself that winners are not quitters and quitters are not winners. So when you are faced with adverse situations or disappointments, that resolve will keep you from falling on the way side. People who quit easily when faced with a difficult challenge never succeed in business. Your DNA must be reprogrammed and quitting

must be deleted. In dealing with difficulties while running your business, you must be constantly thinking of how to deal with

it. You can study and find out how other people have handled similar situations. You can also seek professional advice from someone who has had a better experience in that area. If it is not your area of expertise, then it is better to get professional help for a fee instead of making the wrong decision that might worsen your situation. Asking for help from the right people may be all you need to deal with the situation and move your business forward.

Differentiate your product or service In bringing out a product or a service, an entrepreneur must find a way to differentiate from competition. Be unique. If you are entering a market that is already saturated with similar products, the only way you will be able to succeed is to differentiate what you are bringing. Differentiation can be as simple as ensuring your customer service is on point. There may be other people who are offering similar products but have unhappy customers who will be willing to come to you if you treat them better. The bad service offered by British Airways prompted Richard Branson to start Virgin Atlantic. Branson got stuck in Puerto Rico while trying to get to the British

Cultivate an entrepreneurial mindset

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By Martins Itua, mitua@financialfreedomng.com

Deliberately train and retrain your mind to think in a certain way. Develop the right attitudes for business.

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3

5

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QUICK TAKES

Cultivate and develop inner resilience.The road of the entrepreneur is filled with hurdles, disappointments, failed promises and broken contracts. Winners are not quitters.

Find a way to differentiate from competition. Be unique. Customer service should be on point.

Your business will not go far if you do not adhere to strict quality standards. Infuse quality controls into your operations.

If you want your business to thrive, you must treat your employees well - same way you ensure your customers are happy.

Continuous innovation is the soul of every business because businesses that are unable to innovate, die quickly.

Learn early in the course of the business life, not to be too trusting of what people say. Ensure that you sign MOUs.

Take responsibility and tackle problems as they come before they escalate. Apply your mind and solve problems as they arise.

Issue 07July 11-24, 2016 Financial Freedom

Virgin Islands. “They didn’t have enough passengers to warrant the flight, so they cancelled the flight,” he explained. “I had a beautiful lady waiting for me in BVI and I hired a plane and borrowed a blackboard and as a joke I wrote Virgin Airlines on the top of the blackboard, $39 one way to BVI. I went out round all the passengers who had been bumped and I filled up my first plane.” Branson then decided that he was fed up with airlines that didn’t care about their passengers and he wanted to do something about it. A phone call to Boeing to find out if they had any 747s for sale and Virgin Atlantic was born.

Focus on qualityThe success of your business is in direct proportion to the quality of your product or service. Your business will not go far if you do not adhere to strict quality standards. Imagine starting a restaurant and customers have to use plates and cutleries that are not properly cleaned. Or if they have to fight with houseflies while trying to enjoy their meals. Customers may come for as long as there is no other restaurant in the area with better quality or ambience. From the first day that you start your business, you

must infuse quality controls into your operations. At the end, it is the entrepreneur who will ensure that this is done by constantly setting an example.

Focus on both internal and external customers Great entrepreneurial success is often a by-product of how you treat both internal and external customers. How your staff treat your external customers is often a direct consequence of how you treat them. If you are always shouting them down or paying them peanuts for their work, they will conversely treat customers like crap. Some of them will deliberately undermine your business or drive your customers away. If you want your business to thrive, you must get this principle right. Treat your employees well. Remember their birthdays and celebrate them. Be kind to them and empathise with them when they deal with difficult situations at work and home. They will be willing to go the extra mile to ensure that customers are happy and will do everything to make your business a success.

Keep innovating All successful businesses learn that they should never stop

innovating and reinventing in response to changing operational environments and customers’ needs. A lot of businesses have suffered greatly in Nigeria arising from the foreign exchange problems, especially those who depend on imported raw materials or parts for their products. But while some have quickly adjusted and found local sources for their raw materials, others have shut down their businesses. Continuous innovation is the soul of every business because businesses that refuse or are unable to innovate quickly die. Southern Fried Chicken has responded well to the changing operating environment by introducing SF Chinese. This will definitely enable them to stay profitable.

Don’t wait for people to do your work for youTo be successful as an entrepreneur, you must believe that results are determined by your own efforts and behaviour. Successful people know that they can determine their own future in the long term. They know that if they work hard and make good decisions they will succeed. Sometimes, young entrepreneurs wrongly assign roles to people who hardly believe in their vision or understand what they are asked to do. Some of these people often sabotage their business for their personal gain. In order to succeed, you have to learn early in your business life not to be too trusting of what people say. If you are in doubt, ensure that you sign MOUs with them so that you both have an understanding.

Develop your ability to take initiative The ability to take initiative is vital for entrepreneurial success. As the owner of your business, your success is dependent on your ability to anticipate challenges and proactively solve them. Nobody will do your thinking for you or solve problems for your business. It is critical that you are able to take responsibility and tackle problems as they come before they escalate. Entrepreneurs who take initiative have a higher chance of succeeding than the ones who do not. In fact, you will not survive long in business if you are unable to apply your mind and solve problems as they occur.

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Reasons why start-ups fail

CONTINUES FROM ISSUE 06

CONCLUDED

• that your product or service will meet an identified gap or need in the market.

• You are really driven and have determination, patience and a positive attitude. When others throw in the towel of defeat, you are more determined than ever.

• You can overcome failure and setbacks. You learn from your mistakes and use these lessons to succeed the next time around. Entrepreneurial success is often linked to the ability to build on earlier setback.

• You have an independent mind-set and are able to take needed control and charge to get things effectively accomplished, even with time and money constraints.

3. Poor leadership skillsYour business can fail if you exhibit poor management skills, which can be evident in many forms. You will struggle as a leader if you don’t have enough experience making management decisions, supervising a staff or the vision to lead your organisation. Perhaps, your leadership team is not in agreement as to how the business should be run. You and your leaders may argue publicly or contradict each other’s instructions. When problems requiring strong leadership occur, you may be reluctant to take charge and resolve the issues while your business continues to slip toward failure. This is definitely a recipe for disaster and your business will not endure for long unless you improve on your leadership ability. You will need to learn, study, find a mentor, enrol in training, conduct personal research – do whatever you can to enhance your leadership skills and knowledge of the industry. Examine other business best practices too, and see which ones you can apply to your business.4. Inability to adapt to the needs of the market

Financial FreedomIssue 07July 11-24, 2016

10

The dream of many people who are currently employed and receive monthly

pay cheques is moving from a paid job to self-employment. If you have been employed for a long time and have become addicted to a pay cheque, breaking out might be an arduous task. It is similar to taking the mouth of a baby from sucking. How does the baby survive? That is how it is for most people, hence they are often unable to free themselves and pursue something that they enjoy better and have the potential to bring them more financial success and happiness. Some people have had plans and dreams for many years and written brilliant business plans but the fear of the unknown inhibits them from taking that jump. A little inner voice tells them it might be a jump into oblivion. So they tell themselves, “Tarry here awhile,” and awhile often turns into decades of unfulfilled dreams and promises. Some people might have been better singers or poets or farmers if they only tried hard enough to follow through with their dreams. Some others would have been running highly successful talk shows and comedy programmes had they developed enough guts to press hard and chase their dreams. The saying is true that the place with the most dreams and potentials in the world is the cemetery. The cemetery is the final resting place for untapped dreams and wasted talents. For many people, the challenge is how to start.The process to transition from a paid employment to being one’s own boss and doing something for self. How do you deal with the constant nagging fear that tells you that you will fail? How do you deal with the challenges that might arise when you jump and start? How do you break free from a pay cheque addiction? These are many of the issues that are on the minds of those who have ventured to start something of their own. The reality is, no matter what, certain people will never leave their jobs even when they have ideas that can potentially change the world. There is a place for such people because being an employee is not such a bad thing. But there

are a few others known as trailblazers and world changers who will dare to dream and have the fortitude to go out there and get their hands dirty. Getting hands dirty is part of the requirements for success. That is why a seed is first planted in the soil because it can multiply. Let us examine the seven ways to transition from paid employment to achieving your dreams.

Identify your giftThe first and most important criteria to aspire to venture out is to identify your gift. Everyone has a gift that he/she was born with. You can choose to call it talent. It is that thing that you can do and achieve great results with minimal effort. Some are able to discover theirs and apply it and change their world and society. Like the proverbial man who buried his talent, some people simply never discover theirs or believe they have no talents. If you ever aspire for greatness, it is absolutely vital that you discover something that you are good at because it holds the key to your greatness. Every great person who ever lived or is alive today accomplished great things because they discovered their purpose and talent and used it for the betterment of humanity. Discovering your gift starts with self-interrogation. Take a trip down memory lane and discover that one thing that you have done and excelled at. Your gift occupies your thought most of the time and you dream of achieving it someday. You might be a terrific sales person but you are working somewhere as a desk officer. Your gift might be creating and designing things but you are confined to a job of selling. People often end up being average when they do jobs where they have no talent.

Develop your talent It is not enough to discover your gift but you must go a step further and develop it. You may have a gift but as long as it is undeveloped, it will be of little use. There are lots of people who have great talents and are frustrated because they have refused to apply themselves and developed their talents. Gold and other precious minerals are of no value or use until they have been refined. So the second most important step in deciding

to pursue your ambition is to develop that thing that you are good at. All the world’s great people only became great by developing and exercising their talents. You might have the talent to be a boxer but if you do not train and develop yourself, you are simply dead on arrival. Get a mentor who has done a similar thing that you dream of and learn under him/her. Study the biographies of successful people and learn how they dreamed and applied tenacity in pursuing their dreams. You will also learn how they overcame setbacks and became successful, despite the odds.

Your dream must be bigger than your fearWhen you walk into a supermarket, has it ever occurred to you that

everything there is owned by someone? Successful people learn how to move despite their fears. It is quite normal to be afraid but you do not allow fear to hinder you from pursuing your dreams. The desire to move from a guaranteed pay cheque into self-employment is frightening but remember that your employer must have been an employee at some point. If he had allowed fear stop him, he would not be where he is today. Let the size of your dream inspire you and deal with the fear of failure. There is always the fear of the unknown which is the reason why many are where they are today. Some people awfully detest their jobs but they are unwilling and unable to try something because of the fear of the unknown. You must allow yourself to dream and let that dream be the inspiration to move on despite your fear. All the products and services you see in all the shopping malls in the world are the dreams and aspirations of people. You can join them and be able write your name in gold or you can continue to cringe with fear and refuse to make your life count. Understand that failure is not such a bad thingTruth is, failure is not such a bad thing. Every great person has their share of failure but didn’t allow failure to hinder them from pursuing their dreams. Can you even imagine how many times Thomas Edison and Michael Faraday must have failed in their journey to discover electricity? You need to study the story of the Wright Brothers who invented the aeroplane. They didn’t get it right the first time but they didn’t stop until they accomplished their goals. The road to success is often filled with hurdles and setbacks. If success could be attained on a platter, everybody would have been successful. You need to understand this principle from the beginning, if you are really interested in being successful. The fact that you failed doesn’t make you a failure. What makes you a failure is resignation and unwillingness to try again.

Failure teaches you how better to do it.

Start where you areStarting where you are is vital for business success. Your dream may be big but you are not expected to start big. Some people are waiting for the right conditions to start. They want everything to be in place. Such people will never start. It is like a farmer who refuses to go to his farm because there is rain. What if it rains every day? Start where you are and start today.

Be ready to work harder than you ever workedYou should never be under the illusion that being your own boss means less work. All great entrepreneurs sometimes work 24/7 in order to achieve success. You must understand that hard work does not kill but laziness does. If you are afraid of hard work, you should stay on your job and keep earning your pay cheque. When you step out, you will be required to work at times and under all conditions. You will have to work at odd hours and make calls even when you do not feel like. But the truth is that if you already work hard on your job and are successful, chances are that if you put in same effort into something that you started, you will be successful.

Find the right people who can work with you You are only as smart as the people you surround yourself with. Show me your friends and I will tell who you are. For your dream to see the light of day, you will have to work with people who are either as smart as or smarter than you. Get people who have skill sets that you do not have to complement you. Don’t be a jack of all trade because you will not make a success of it. Great entrepreneurs are good managers and galvanisers of people.

JumpLastly, you need to jump. Get out. Break out. Liberate yourself. Emancipate your mind. You can dream all you want and write the best business plans in the world but until you jump, it all amounts to nothing. The last bit is the most difficult for most people because they have become comfortable and complacent. Their senses and minds have been dulled and lulled by the constancy of a pay cheque. You need to jump and make your dream a reality.

Moving from paid job to self-employment SMALL & MEDIUM-SCALE ENTREPRISES

ONYI EZEAYINKA

Everyone has an inherent gift or talent. Discovering your gift starts with self-interrogation. Your gift occupies your thought most of the time and you dream of achieving it.

Talents in their raw form are really of no use. Develop and exercise your talent. Get a mentor.

Successful people learn how to move despite their fears. Let the size of your dream inspire you to deal with the fear of failure.

The road to success is often filled with hurdles and setbacks. Failure teaches you how better to do it.

Your dream may be big but you are not expected to start big. Start where you are and start today.

Being your own boss doesn’t mean less work. Hard work does not kill but laziness does.

For your dream to see the light of day, you will have to work with people who are either as smart as or smarter than you.

You need to jump and make your dream a reality. Get out. Break out. Liberate yourself.

INSIGHTS

START-UPS & SMES Issue 07July 11-24, 2016 Financial Freedom

oezeyinka@financialfreedomng.com

The people who tend to create wealth are also those who tend to

accumulate other peoples monies either in large volumes or in large value. They are able to serve more people in number or in value. As stated, if we command our wealth we shall be rich and free; if our wealth commands us, we are poor (Edmund Burke, Letters on a Regicide Peace, 1796, culled from Other People’s money, John Kay, 2015). The issue is how we are able to command people’s money. How many people are willing to entrust their funds to us either directly or by purchasing our service or product? This is the point we need to reflect on.That takes me to the issue of export vs import. The bane of Nigeria. As an economy we tend to import a lot compared to what we export. This is why the government has been talking about diversifying the economy

and ensuring we produce more. Anyone’s ability to serve more people means that so many more people are willing to trust you and give you their money. How appealing are you, how appealing are your output? Who are you selling to? Is he satisfied with the quality of the product? Is he happy with your ability to provide after sales service? Does the product disappoint the person consuming it and trusting you to deliver? These are simple questions we need to constantly reflect on.Second sets of questions will be at wat level are we operating? Are we addressing people’s primary needs or their superior desires? Are we engaging their minds or are we just engaging them at their primary basic desires? As you improve the quality and the appeal tends to shift from primary needs to wants and desires. However the wealthy tend to be able to deliver over a long period

of time to people who tend to be satisfied. What

am I saying? I believe we are all on the same page and are able to reflect on these.So the question is to find out how we can get people to trust us enough to hand their money over to us. How can we go about that? It will start with what I have to offer. What do I have to offer to someone? Is it my skill? Knowledge? Product? Idea? What do I have today to offer to someone?Am I offering these skills, ideas, product etc. to people or I am shy and doing nothing about it? I hear us say I am shy, I cannot walk up to someone, I am scared of rejection, the standard I currently am at is not sufficient etc. Are you serious? Do you really want to be wealthy?The other area is am I able to get people to reorder what I have to offer? Am I innovating adequately to give additional experience or a consistent experience to the people who like my product?

What is bringing them back to that product? Are they able to reuse my product? Is the trust level increasing?I have chosen to actually position this particular write up as a series of questions and hope that we will reflect on them and as we answer these questions we gain the confidence to realise that we need to own a skill, product, service, product etc., we need to sell the product that we have, we need to be able to re-offer the product to people or get people to reuse them, we need to be out there approaching people and continuously improving while attracting more people. Why? This is because this is the way we grow our wealth. It is about other people’s money. The more people can put money in our hands the more we can sustainably grow our wealth.

lonaghinon@financialfreedomng.com

11

It’s about other people’s moneyCREATING WEALTH NOW

LLOYD ONAGHINON

OPINION

Nigeria’s economy is one that tends to import a lot compared to what is exported.

Find out how we can get people to trust us enough to hand their money over to us.

We need to own a skill, product, service, product.

We need to sell the product that we have - and re-offer the product to people or get people to reuse them.

We need to be out there approaching people and continuously improving while attracting more people.

TAKE AWAYS

Social entrepreneurshipIt is actual medical care - about 85% of it. A strong foundation of primary care is required for every healthcare systemWellCare Initiative is a leading Health Care services organisation pioneering a transformative business model with a patient-first approach to healthcare. WCI has uncompromising focus on personalised, high-quality care, providing convenient access to doctors, nurses, and medical teams who deliver comprehensive primary care services to patients giving them unparalleled attention and care. Patients have unrestricted access to appointments in the clinic, by phone and electronically, extended office and weekend hours, and 24/7 physician coverage. By spending more time with patients, WCI helps them avoid unnecessary specialist and hospital care, thereby reducing overall healthcare

costs and focusing on the patient, rather than the paperwork. Having an advocate within the healthcare system, WCI patients report increased satisfaction with their care and benefits. WCI is a national leader in the burgeoning free consultation and free prescription generation movement, whose adherents provide unrestricted access to primary care through longer appointments, extended hours, and phone and electronic communications with providers so patients can take care of health needs promptly and avoid downstream care and costs.WCI clinics are designed to address approximately 90 percent of the issues for which patients seek a doctor’s care, including all routine primary and preventive care. This includes women’s health services, paediatric care, urgent care, wellness

education, ongoing chronic disease management, select onsite procedures and diagnostics, as well as coordination of outside specialist and hospital care by a WCI provider.One of the best things about WellCare model is that it comes in a variety

of flavours. To date, the values WellCare lives by are a self-sustaining success. The clinic relies on word of mouth advertising primarily through the patients, since an overwhelming majority of its benefactors are FIWONs. FIWON also act as a referral source by identifying families in need. WCI provides exceptional care by ensuring that her patients also have a pathway to diagnostic and specialty care -- some of the more difficult health services to reach for the most vulnerable. Her partnership with Medicoexperts, an international health concern programme that has been around for decades, assists the clinic’s mission of providing holistic care. WellCare also carries out its mission by participating in day of caring (DoC). On this day, she collaborates with local physicians, dentists, volunteers, and experts

from the medical society to provide free health screenings at a makeshift clinic in a local community. Services include but are not limited to flu shots; blood pressure, blood sugar, and cholesterol monitoring,; dental screening; and diabetes coaching A lot can be accomplished when communities are left alone to devise simple and effective ways to extend medical assistance and support services. WellCare is just one representative case study within the entire affordable medical care movement. It’s a contagious concept, and it’s all in good taste.The analysis by WCI reveals that the increasingly popular WellCare model, with its emphasis on unrestricted access to primary care, makes healthcare 20 percent less expensive than traditional health insurance yet leaves patients feeling more satisfied with their care.

3WellCare Initiative’s patients have unrestricted access to appointments in the clinic, by phone and electronically, extended office and weekend hours, and 24/7 physician coverage.

WCI clinics are designed to address approximately 90 percent of the issues for which patients seek a doctor’s care.

WCI provides exceptional care by ensuring that her patients also have a pathway to diagnostic and specialty care.

TAKE AWAYS

By Onoja Alexander, CEO, WellCare Initiative (WCI) & Cordinator FIWON

CONCLUDED

CONTINUES FROM ISSUE 06

Financial FreedomIssue 07July 11-24, 2016

Government spending in the health sector has declined in most states in terms of

percentage of the total budget allocations as well as a percentage of the GDP. The public health investment in some states over the years has been comparatively low, and as a percentage of GDP has declined. Almost the entire increase (in absolute terms) in spending by the government on health has been consumed by the increase of the wages so much so that funds meant for infrastructural development, repair and maintenance, drugs and essential medical supplies have been severely curtailed leading to further deterioration of the quality of healthcare services delivered by public health institutions. Public awareness of and expectations from health services provided by the government are rising rapidly. This is to an extent fuelled by the rapidly escalating cost of medical care provided by the private sector providers who constantly raise the bar on the range and quality of healthcare services available in the country. With the present state of economic health of State governments and the increasing deficit in national budgets, it is unlikely that public sector allocations/spending on healthcare would register any increase. How these opportunities can be harnessed?The National Health Policy welcomes the participation of the private sector in all areas of health activities – primary, secondary or tertiary. The policy also encourages the setting up of private insurance instruments for increasing the scope of the coverage of the secondary and tertiary sector under private health insurance packages.Public private partnerships can

work well, provided that both the governments and private sector work in a trusting and collaborative way to achieve common goals. Preconditions for

successful partnerships are: 1. Adequate funding for public

services 2. Consistent rationale for using

PPP 3. A strong public sector partner 4. Responsible private or

voluntary providers 5. Legitimacy among the general

public 6. An evidence-based approach

to policy Successful public-private partnerships rely on politically and economically supportive environment as well as committed partners. It would be advantageous for hospital managements and health sector players to recognise the beginning of the PPP wave and learn to ride it well. State governments are now actively considering several ways of partnership with the private sector: 1. Up-gradation and

professional management of one or two departments/services within public hospitals

2. Outsourcing specialised medical procedures and diagnostic services

3. Handing over entire hospitals/health centres to private partners to re-equip, upgrade and manage

4. Health insurance and community health financing

5. Social marketing of healthcare products/supplies and social franchising of healthcare services

6. Private pharmaceutical manufacturers/distributors could partner with government to set up and operate a network of fair price pharmacies for generic drugs (essential drugs lists) operated from within/outside the public hospital facilities. Prices of drugs and supplies to be agreed by both partners and the agreements run on profit sharing basis. Government could invest in the infrastructure such as warehouse & space for the pharmacies and hand them over to private partners to manage, maintain and operate under lease agreements.

7. Private distribution and rural marketing companies could partner with the government to market maternal and child drugs and supplies at agreed prices. Government could part fund the promotion/distribution related costs with the rest including profits recovered through sales.

The future trend of public private partnerships is getting clearer by the day. The opportunity is real. Private sector investors, managements and professionals need to wake up to the possibilities and effectively articulate their expectations and terms of business to set the agenda for lasting partnerships with public sector.

BUSINESSYOUREALLYSHOULDTRY12

Leadership legacy is the sum total of the difference a leader makes in people’s lives, directly or indirectly, formally or informally. Simply, it is what a leader leaves behind when he is no more on the scene. As a father or mother, what do you want your children to remember you for? As the manager of your company, what do you wish to be remembered for? We have leaders and people that lived over half a century ago and we still talk about them

as they though they died only yesterday. Some people are remembered for the courage they demonstrated in the face of opposition and others for the positive difference they made in the lives of those around them. For instance in certain parts of the world, we remember the brave soldiers who fought and sacrificed their lives in defence of their beloved countries. Their names are not only indelibly inscribed on the walls of churches and buildings all

over the country but more importantly, in the hearts of the people for whom they gave their lives. Trustworthiness is vital for effective leadershipWhat can you do to create a positive, empowering legacy that will endure and inspire? One sure way a leader can leave an enduring legacy is to be trustworthy. A leader must consistently prove to his people that his word is his bond and that

he can be trusted, under all circumstances. This is especially important in today’s organisations, with the recent corporate scandals in America and Europe. If leaders can get this right, other things will certainly follow as a natural consequence.Leaders manage transitions effectively Another challenge of leadership today is managing the complexities and unpredictability of the socio-

economic environment. Therefore, the ability to lead and manage change is a great leadership imperative. The final test of a leader is that he leaves in other men the conviction and will to carry on. According to Walter Lippmann, the genius of a good leader is to leave behind him a situation which common sense, without the grace of genius, can deal with successfully. In essence, he leaves behind an organisation that outlives him.

Great leaders leave an enduring legacyFINSPIRATION

Get involved in public private partnerships in health

ESSENTIALSManagement: professional management of one or two departments/services within public hospitals.

Services: Outsourcing specialised medical procedures and diagnostic services.

Insurance: provide health insurance and community health financing.

Marketing: market maternal and child drugs and supplies at agreed prices.

Issue 07July 11-24, 2016 Financial Freedom

By Onoja Alexander

The marketPresently, all our eggs for the foreseeable future are sold out. But I refuse to take money ahead of the production, otherwise, I would have heard all our eggs taken up for the next two months. The market for eggs is huge. For fish, I have never had fish that I could not sell. The biggest challenge with the fish is not the sales but the production i.e. achieving what the market wants and at the price that they want it. I had thought I could sell and produce at my own price but competition fixes prices that you have to match because we are competing with people from the western and eastern parts of Nigeria who have large

bodies of water and can produce at very low costs. Their cost of production and input are cheaper and so they can afford to sell at cheaper rates. In northern Nigeria, you have to build ponds made of concrete, but in the east they use mostly earth ponds and all they have to do is excavate. The market will always mop up your product but production is tasking. In order to meet up with up competition, we have to find ways to produce cheaper to maintain profit.

Never worked for anyoneThe plan my parents had for me was to study accounting, be a chartered accountant and work in the banking sector which had a lot of opportunities then. But I woke up one day with this feeling that if ever got in to banking that I was going to die. First of all I couldn’t stand being in one place, a cage dispensing money, so I ran with all the strength I had. Also, I already owned a restaurant from school which was giving me money. I never lacked money as a student and I had excess. Then the starting salary in the banking sector was N30,000 to N40,000. I was making more than that. I believed I could make it on my own.

Entrepreneurs are born?I think entrepreneurs are born because it’s an instinct that drives you and not trend. No doubt there are trainings required to be a good entrepreneur, but

the instinct that drives you to be independent and do your own thing is inborn. If you don’t have it, you don’t have it. I think I have it. So when my parents drove me to go work somewhere to be like someone, it didn’t work.

Sleeping in the farm...To be an entrepreneur, you don’t have the 9a.m. to 5 p.m. time because you have work 24 hours. You have to be able to manage your time to combine your family, business and relationships. I sleep in the farm when I have to. When you look around the farm, it might look uncomfortable but I’m okay sleeping here. Sometimes, I have to stay here till 4a.m. Nevertheless, I have to balance it with creating time for other needs of life. Secondly, in Nigeria you are basically on your own as there is no structure. Financing is another ball game. The conditions to access bank financing are herculean. But I didn’t give up or run or run away because I looked for possibilities. I look for other means to make it work. I re-invented, re-created and found ways to make my business survive and profitable.

Place of integrityIntegrity has helped me through the years and I think that one of the key ingredients entrepreneurs need is integrity. People need to trust you and hold you to your word. Then they will invest, in you. Family members have given me money to invest and expand because they trusted me to do what I said I would do. I get many supplier credits because they believe that I am running a good enterprise. But it is a factor of people believing that I am a serious entrepreneur who has integrity.

Satisfaction Two years ago, I received an award as the business man of the year from the Abuja Enterprise Agency (AEA). Tears ran down my eyes because it was one award that captured what I’ve done over the years. The award was an external recognition of what I have been able to achieve. This award motivated me to go to the next level in my business. From there, I worked with the Agency to train young farmers. In collaboration with them, I designed the Agro-revive Project to motivate people into agriculture. It gives me a great joy to see a chick grow in three weeks and start producing eggs on a regular basis.

ApprenticeshipI encourage apprenticeship. For

anybody who wants to start a business, I advise that you learn, meet up with people in the same field, get training, build relationships, study and learn the secrets. Then set up gradually, start small and grow. Guiding lessons

I always think through a process. Don’t ever start anything without thinking it through. Find out and investigate all that could possibly go wrong proactively provide solutions for them. After you have checked, things can still go wrong. And when you have internalised that all things can still go wrong, you are the entrepreneur.

Create a business structureMy palm oil business failed because I travelled, plus the fact that it was a one man business. I’ve learnt that you have to create a structure for your business. Four years ago I redesigned my business. I brought in professionals, a veterinary doctor, a human resources person, a lawyer and a financial analyst. I need to get to the next level and their expertise and professional advice will help the business. Today, the company can function without me in the farm. When a business is properly structured then, you can travel and attend to other needs. The lesson is that people who structure their business around them are exposed to huge failure.

Opportunities in the food sectorIn the past few weeks, the government has rolled out its school feeding programme that requires that about N93bn be pushed into the food system. The minister of agriculture just signed a memorandum of understanding with a farm for N25bn for 50 million eggs a day called National Egg Production Promo a.k.a. Egg Pro. It is a clarion call for more food. For me, the opportunities are expanding. Rural urban migration in Nigeria is increasing every day. If we assume N100 per meal every day multiplied by 38 million households, the opportunities are huge in food and agriculture. If we are not producing, there will be food scarcity in the country.

Advice First of all, minimise your costs at the beginning, live within your means. Start small, create a world for yourself away from distractions and focus on your goals.

“I think entrepreneurs are

born because it’s an instinct that drives you and not trend.The instinct that drives you to be

independent - and do your own thing - is inborn. If you don’t have it, you

don’t have it.”

13RISE OF THE ENTREPRENEURFinancial FreedomIssue 07July 11-24, 2016

Agorua

CONTINUES FROM PAGE 04

NOTEWORTHY14

BY NUMBERS

WORD SEARCH

AFGHANI EURO KWANZA NEW SHEKEL RUPEE

ARIAYRY FORINT KYAT NGULTRUM RUPIAH

BAHT FRANC LEMPIRA OUGUIYA SHILLING

BALBOA GOLD CORDOBA

LEONE PATACA SOM

BIRR GOURDE LILANGENI PESO SUCRE

BOLIVAR GUARANI LIRA POUND SYLI

BOLIVIANO GUILDER LITAS PULA TAKA

COLON HRYVNIA LOTI QUETZAL TALA

DALASI KINA MANAT RAND TENGE

DENAR KORUNA METICAL REAL TOLAR

DINAR KRONA NAIRA RIAL VATU

DIRHAM KRONE NAKFA RINGGIT WON

DOLLAR KROON NEW CEDI RIYAL YEN

DRAM KUNA NEW DONG RUBLE YUAN RENMINBI

ESCUDO KWACHA NEW KIP RUFIYAA ZLOTY

199thNigeria’s rank out of 139 economies in the overall ranking of its Global Information

Technology Report (GITR) rated by the World Economic Forum (WEF).

9,720Number of ghost workers on the payroll

of Kogi State government, as uncovered

by the committee on staff screening and

verification.

We were sitting round, having

drinks when the old subject of money came up. It focused on how men work hard to get this elusive money and women seem to be adept at getting money. One of the men there said rather bitterly that no man had ever dashed him money. The females sitting around burst into laughter. It sounded alien. At one time or the other a man had dashed them money. The married men on the table had a slightly different issue. Their problem was that the women were giving them a run for their money-quite literally in the workspace. The next issue was that more women were being employed and rising up the corporate ladder. They felt resentful that the women had more earning power and were becoming bossy and demanding on the home front. Immediately the energy in the room became charged as all the men wanted to tell their experiences. Another woman debated that women had other sources of income besides her current job and therefore more disposable income. The more honest men said their income was barely enough to cover the bills in the house so they were grateful that their wives offered the financial support. They however felt at times that the wives overstepped their bounds. Whatever that means! Another group seemed more representative of the confusion we have on ground. They would rather the women stayed at home and took care of the home front but the mere suggestion leads to a long winding narration of feminism and stereotyping. So they let her work and let her to be equal partner since that’s what she wants. Since she has money she can do what the he can and more,

so why fight her? Another set said they gave ultimatums: you work, you earn money, you run the family or you stay home, I work, provide money you make do with it. The perception is that there are more economically independent women thereby creating a complex in the men. However, it is still a man’s world with the fact that they are still at the helm of affairs where it matters, they still drive the policies, they still make the decisions, and they still make the employments and advancements. So why

are the men who have the power complaining that they are not having access to the jobs or money that women who are still not in power have more of?Everyone on the table agreed - strangely - and put it down to the magnetism between men and women. Men view women as their mothers, wives, sisters, girlfriends and are more likely to be more acceptable to whatever a woman brings up. This in no way takes away from the fact that women work hard, are smart, loyal and diverse. It just brings home the point that a woman by her sheer gender is influential. And so they get to the workspace and the men who have the power use it to propel women consciously and unconsciously. As much as there are women who are climbing there are women who still have difficulties at work. Recently the Lancet Breastfeeding Series 2016 was launched in the capital city of Nigeria. The main take away was the fact that babies would develop a whole lot better if they were exclusively breast fed for six months. Wahala! So a woman would be expected to be out of the workspace for six months. I’m sure 10 years ago men wouldn’t even consider this but with the earning power of women and the financial burden it relieves them of, they will support it. It looks like a win-win situation. For the men that feel the woman should stay home and raise kids, at least for the first six months of the child’s life she will be at home while still earning a full salary! Once there is a shift in who has more of the spending/earning power, the dynamics of the relationship will shift. This is what I call messing with the order of things. Interestingly, men remain the top earners, so why is there so much talk about women earning more?

habdullahi@financialfreedomng.com

3

Power and money RELATIONSHIPS AND MONEY

HAUWA BOOTH

The perception is that there are more economically independent women thereby creating a complex in the men.

Men view women as their mothers, wives, sisters, girlfriends and are more likely to be more acceptable to whatever a woman brings up.

Women work hard, are smart, loyal and diverse. It just brings home the point that a woman is influential.

Once there is a shift in who has more of the spending/ earning power, the dynamics of the relationship will shift.

Men remain the top earners, so why is there so much talk about women earning more?

TAKE AWAYS

Issue 07July 11-24, 2016 Financial Freedom

Do you have a good business idea?

Can your idea meet a market need?

Are you hindered by lack of capital?

The Investor is here to fulfil your dream.

to start your N300,000 WinStand a chance to

1. Is the investor giving me the money as a loan? No. We are investing money in your business in return for a stake known as equity.

2. Do I have to repay the money? No. Our stake in the business ensures that the money is repaid.

3. For how long does the investor hold the stake? For not more than three years after which we can decide to sell the stake back to the owner of the business. At this point, the business is expected to have developed and be able to stand.

4. Is the application fee refundable? Application is FREE.

5. What is the maximum amount that can be received? The investor will be investing from any amount up to a maximum of N300,000.

6. What are the evaluation criteria to determine both eligibility and who finally qualifies to win the money? Service/product must meet a market need. Ability to present a good cash flow projection is vital for selection. The quality

of your business is a critical factor for selection.

7. Why does the investor want to give people money? The investor believes in empowering people and enabling them achieve their dreams of owning their own business.

8. Apart from the cash how else would the investor assist the beneficiaries? The investor will assist by way of providing mentoring, advice on marketing strategies and consultancy for free where necessary. The investor will arrange for a mentoring opportunity with someone successful in your particular line of business.

9. What is the final condition before award? Due diligence will be done on all successful candidates by way of character check and acceptable references.

10. What is the duration from the time of application to receipt of cash? The investor intends to carry out the exercise on a quarterly basis therefore the entire process from the purchase of funds to setting up beneficiaries is not expected to exceed 3 months.

Financial Freedom is looking for 15 people with viable business plans that need seed capital of N300,000.

The investor wants to provide funding for start-up businesses or businesses in need of capital injection - entrepreneurs whose business ideas show prospects of high returns on investment and will create at least two to four jobs.

In a year, the plan is to finance 60 businesses, create about 240 jobs that will have direct impact on their local economies. Please download an application form at www.financialfreedomng.com for FREE and submit at bizcompete@financialfreedomng.com

Only the first 1000 applications will be considered.

FREQUENTLY ASKED QUESTIONS

Financial FreedomBUSINESS PLAN COMPETITION

15Financial FreedomIssue 07July 11-24, 2016

3Governments must borrow funds to build schools, hospitals, mass

houses, roads, water dams, electricity power plants and other projects that are backbone for economic development, if its budget is in deficit. Likewise, corporate entities borrow funds to finance expansion, replace or upgrade equipment. The traditional long-term source of funds is usually bond issue – an interest-based debt. A conventional bond is a contractual debt obligation, an IOU whereby the issuer is contractually obliged to pay interest and principal to bond holders, on a certain specified date. One of the common factors in government and corporate bond is payment of interest. However, there is an alternative to interest-based bond, which is sukuk. Sukuk is popularly known as non-interest bond or Islamic bond. It is a certificate of equal value evidencing ownership in real asset, usufruct or business venture. Unlike conventional bond where the bond holder has no legal or beneficial right over the asset constructed from the bond proceeds, Sukuk evidence legal ownership in the project or asset that is financed with the proceeds. Thus, no interest is paid but return in form of profit or rental depending on the contract used. With sukuk, the federal government and its agencies, State governments and their agencies, supranational corporations and public companies can access the capital market to raise fund for either infrastructure projects or expansion programmes via Islamic financial contract such as partnership, lease or sale

arrangement. The issuance of modern sukuk started in 1990 by multinational Shell MDS which issued a sukuk ijarah worth RM125m in Malaysia. Today, with integrated financial system and encouraging regulatory framework, Malaysia has become the leading corporate and public issuer of sukuk in the world accounting for an average of 60 per cent of annual issuance. The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI), a standard setting institution based in Bahrain describes 14 different sukuk structures which are designed on the basis of Islamic financial contracts such as musharaka, mudaraba, ijarah, murabaha, iIstisna’, salam and so on.Gradually, sukuk is growing in popularity and is fast becoming an acceptable financial instrument around the world as an innovative way to raise funds for various infrastructural projects, business expansion, and increased competitiveness, which attracts ethical and creative investors worldwide. It is now an acceptable instrument not only in the Muslim dominated countries but also in Europe and USA. In 2004, Saxony Anhalt, a federal state of Germany issued ijara - lease - sukuk of €100m. World Bank through its affiliate, the International Finance Corporation (IFC), issued its first sukuk in 2004 for $132m followed by IFC hilal sukuk in 2009 for $100m. Other major sukuk issuances in US are the East Cameron Gas $165m sukuk issued in June 2006, which was the first musharaka - partnership - sukuk in America backed

by oil and gas assets and the General Electric $500m sukuk, which is an ijarah sukuk backed by aircraft leases. In June 2014, UK issued a Sovereign Sukuk of £200m structured as ijarah sukuk backed by landed properties belonging to the office of the secretary of state for communities and local government. The sukuk was profoundly oversubscribed by investors in the UK, Middle East and Asia, attracting orders of £2.3bn – over 11 times of the total amount offered.The sukuk issues are listed on the stock exchanges around the world for trading. The major stock exchanges that attract sukuk listing are London Stock Exchange, Bursa Malaysia, Luxembourg

Stock Exchange and Irish Stock Exchange. Others are Nasdaq Dubai, Hong Kong Stock Exchange and Saudi Stock Exchange amongst others. In order to track the performance of sukuk trading and provide benchmark to investors, many sukuk indexes are springing up. The Dow Jones Sukuk Index was established to measure the performance of global Islamic fixed-income securities – sukuk. The Thomson Reuters Global Sukuk Index provides a benchmark for investors of dollar denominated sukuk while the Bloomberg AIBIM Bursa Malaysia Corporate Sukuk Index serves as a benchmark for investors of ringgit-denominated Islamic bonds in Malaysia. African countries are not left behind as Sudan sukuk issuances have been in the international scene. Senegal issued a four-year $168m sukuk in June 2014 while South Africa launched a $500m $5.75m-year sukuk in September 2014. In Nigeria, the capital market apex regulatory body - Securities and Exchange Commission has provided legal backing in 2013 by establishing rules regulating sukuk issuance pursuant to the Investments and Securities Act. As such, the Osun state government issued N11.4bn sukuk ijara in October 2013 for construction of 27 high, middle and elementary schools within the State. The Osun sukuk was listed on the floor of the Nigerian Stock Exchange and FMDQ OTC platform for trading. Sukuk is always tied to an asset, which make its value at risk (VaR) rate lower than general purpose conventional bond. Hence,

it is an attractive financial instrument which is favoured by all categories of investors including conventional bond investors such as pension fund administrators, insurance companies, banks and others. It is also an instrument that has no boundary in terms of attracting foreign direct investment. With current declines of government revenues and huge budget deficits, both federal and state governments need to raise funds for infrastructure via alternative sources such as sukuk. The federal government of Nigeria has a budget deficit of N2.2trn which is expected to be funded with local and foreign debt. Virtually all State governments have budget deficits and some are in need of bailouts from the federal government to cater for their recurrent expenditure. For local debt, governments can issue sukuk in place of conventional bond to finance the deficit on project-linked financing. Sukuk can be structured to pay for itself from the cash flow generated by the project, hence providing more room and flexibility on government’s meagre revenues. The sukuk issuance can be done directly from the government or its agencies. To issue sukuk, the issuer needs to have physical assets either in existence or to be constructed which the sukuk backs. With the infrastructure need and infrastructure financing gap in Nigeria, sukuk is arguably a watershed opportunity for financing such projects. Government needs to wake up from deep slumber and face reality. And explore sukuk as an infrastructure financing tool.

Sukuk: alternative to conformist infrastructural bond

LEVERAGE16

NON-INTEREST BANKING

This implies stopping money leakages, however small or insignificant they may seem. Most money leakages are through unnecessary tax and interest expenses, wrong spending and wrong investments. Money leakages are the most common reason for inability to create wealth.

Know where you are before you start It is essential to make a complete list of one’s assets and liabilities, income and expenses (both current and expected in future) and cash flows before one starts. One cannot reach a destination without knowing where he or she is starting off.

TIPFf Get your finances under control

ATTAHIRU MACCIDO

Sukuk is an alternative to interest-based bond and is popularly known as non-interest bond or Islamic bond.

Malaysia has become the leading corporate and public issuer of sukuk in the world accounting for an average of 60 per cent of annual issuance.

To issue sukuk, the issuer needs to have physical assets either in existence or to be constructed which the sukuk backs.

TAKE AWAYS

Issue 07July 11-24, 2016 Financial Freedom