financial vanguard june 17 2013
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ÂTRANSCRIPT
CMYK
JUNE 17, 2013
Continues on page 18
By GODWIN ORITSE
Crisis brews at Port as accusations,denials trail destination inspection
AS the management of the Niger
ia Customs Service (NCS) to takeover cargo scanning func-
tions from the three contracted serviceproviders (Contecna, SGS and Globals-can), there are strong indications thatthe scheme may have run into troubledwaters as A. P Moller has declined re-sponsibility for moving containers toscanning site. But the spokesman forCotecna, Mr. Aminu Mohammed con-firmed to Vanguard the fact that therewas an agreement between AP Moller,the three service providers, importerswith Customs as witnesses for APMoller to move containers to scanningsites.
He said that it was unfair for A PMoller to say that it was not its respon-sibility to move containers to scanningsite. The Scanning Manager at A. P
Moller, Mr. Ernest Walker also reiter-ated the tripartite agreement sayingthat A.P. Moller is overwhelmed by thelevel of request of containers for scan-ning. “A. P Moller is finding it diffi-cult to handle the situation that is whythey are calling for a review of thenumber of containers to be positionedfor scanning.” The management of A.P. Moller terminal had written to theApapa Customs Command intimatingthem of the serious issue the terminalis having with the current level of con-tainers and its inability to continue toposition 600 containers for scanningevery day. The letter said in part;“APMT Apapa has serious issues withthe current level of containers requir-ing to be scanned. The number hasseriously risen hugely over the pat fewmonths to unsustainable levels. Thereis an urgent need for the Nigeria Cus-toms to review the level of this requestand reduce them to sustainable lev-
els. APMT requests that Nigeria Cus-toms Service reduce the level of scan-ning bookings to the agreed 200 per day.This will enable us to continue our co-operation with Customs and to fully con-tinue our main function of dischargingand loading container vessels.”
The terminal operator called for an ur-gent review of the number of requestsfor container meant for scanning. In theletter signed by the Commercial Man-ager of A. P Moller terminal, Mr. NeilFlecher which was sighted by Vanguard,it was said that reducing the number ofcontainers will enable the terminal tocontinue to cooperate with Customs. Thisdevelopment, if not nipped in the budmay snowball into another round of portcongestion which could have dire con-sequence on the nation’s economy. Themanagement of A. P. Moller Group, op-erators of Nigeria’s biggest port termi-nal, Apapa, has said that the current ef-fort in positioning 600 containers for scan-
ning everyday has become unsustain-able and called for a reduction of thenumber to 200 per day as it does nothave the capacity to handle the currentvolume. The development will consti-tute a major obstacle to quick clearanceof cargo from the port occasioned by adrop in the rate of scanned containers.
While A. P Moller is saying that it isnot its responsibility to move contain-ers to scanning site, Cotecna has saidthat there was an agreement betweenthe terminal operator, service provid-ers and the importers with Customs aswitness.
At a recent meeting between the man-agements of A. P.Moller, the ApapaCustoms Command and some selectedfreight forwarders, it was said that A.PMoller is not prepared to move withtime as regards trade. In the minutes ofthe meeting, the issue of delay in the
*From left: Group Treasurer, United Bank for Africa Plc, Mr. Emmanuel Onokpasa; Managing Director, NASD Limited,Mr. Bola Ajomale; and Vice-Chairman/CEO, ICON Stockbrokers Limited, Mr. Chike Nwanze; Managing Director,Central Securities Clearing System (CSCS), Mr. Bukar Abba-Kyari; and Managing Director, Signet Securities Limited,Mr. Dipo Aina, during the signing of agreement between the NASD, CSCS and settlement banks in Lagos.
CURRENCY BUYING CENTRAL SELLING
CBN Exchange rate as at 14/06/2013
106.01 +1.06
97.78 +1.09
-1.15
-66.00
0.33
DOLLAR 154.75 155.25 155.75POUNDS 241.8588 242.6402 243.4217EURO 205.9413 206.6067 207.2721FRANC 167.2069 167.7472 168.2874YEN 1.6298 1.6351 1.6403CFA 0.2942 0.3042 0.3142WAUA 234.5852 235.3432 236.1011RENMINBI 25.2397 25.3217 25.4037RIYA 41.2634 41.3967 41.53KRONA 27.6098 27.699 27.7882SDR 235.9009 236.6631 237.4253
122.55
2,242.00
16.57
Cover Story
CMYK
18 — Vanguard, MONDAY, JUNE 17, 2013
Continued from page 17
,
,
Crisis brews at port as accusations,denials trail destination inspection
treatment of Single Goods Dec-laration (SDG) forms (a docu-ment which collates the data onthe declaration used for clear-ance of goods, it can also beused by Customs to build updata and statistic on the na-tion’s foreign trade). Anothermajor issue contained in theminutes of the meeting is thatof delay in the immediate clear-ance of goods as it was sug-gested that provisions be madefor people to clear their goodsor containers on Sunday. MrDan Katsina, an Apapa-basedfreight forwarder said that theissue of scanning has becomea major problem adding thatsome of these problems areman-made. He noted that theterminal operators do not haveenough equipment to positioncontainers for scanning, notingthat between 150 to 180 trucksloaded with containers are po-sitioned for scanning asagainst 250 to 600 containerson a daily basis. Dan Katsinawho is the immediate pastChairman of the Apapa Chap-ter of the Association of Nige-rian Licensed Customs Agents(ANLCA) explained that itnow takes two weeks to book acontainer for scanning. Hesaid the inefficiency on the partof A. P Moller to lift containersto scanning site is also caus-ing problem for trade facilita-tion .
It was gathered that at thestakeholders’ meeting in whichthe Customs Area Comptroller,one Controller MohammedUmar presided over, thosepresent were said to havecalled on the management ofA.P Moller to be more proac-tive. It was also learnt thatUmar emphatically informedthe management of A. P Mollerof the complaints the Com-mand has received with re-gards to documentation, a de-velopment that led to more con-tainers being directed to scan-
ning. Parts of the minutes read;“The CAC reminded the meet-ing that there was a time inApapa that containers bookedfor examination in the eveningwas positioned the next day forexamination. But instead ofimprovement, the issue is nowretrogressive, if trade does notprosper, Nigeria cannot pros-per.”
Also speaking on the issue ofdelay of cargo clearance fromA. P Moller terminal, Mr.Lucky Amiwero, a frontlinefreight forwarder and a logis-tics expert said that it is theresponsibility of A. P Moller tomove containers to scanningsite because they collect a feefor this service. He explainedthat the management of A. PMoller purposely delays themovement of containers toscanning site because besidesthe fee they collect for move-ment of containers to scanningsite, they also collect demurrag-es on these containers. He not-ed that A.P Moller does nothave the capacity to move con-tainers to scanning site addingthat they sometimes delay con-tainers meant for scanning forup to seven, eight and some-times nine days.
In a swift reaction, the media
adviser to the terminal, MrBolaji Akinola said “scanningis not our responsibility,” not-ing that APM Terminals onlyintervened by taking over thelogistics to bring about efficien-cy in the system. He said; “Wevoluntarily took over the re-sponsibility of providing logis-tics of scanning (using trucksto move containers to and frothe scanner site) because theprevious arrangement was notworking well.
“Less than 60 containers werescanned per day and truckswere forced to wait for up tothree days to complete thescanning process. When weintervened, we had a writtenagreement with the service pro-vider that not more than 200containers per day can bescanned partly due to the ca-pacity of the single fixed scan-ner and also due to the fact thatthere is no pre-advice given byCustoms. Please note againthat we are not responsible forproviding the scanner or foroperating it.
“It just happens that it iserected on our facility contraryto what obtains at Tin Can Is-land Port where the scanner islocated outside the main portterminal. Since our interven-tion commenced, we have re-ceived several commendationas the waiting time for truckswas eliminated saving thosewho hire the trucks about N30,000 per day (or N90, 000 forthe three days). This is despiteseveral constraints includingthe fact that Customs does notadvise us on the containersthat needed to be positioned inadvance. We must wait untilthe customers (importers) areadvised individually by Cus-toms as to whether or not theircontainer needs to be scanned.He explained that the terminalcan only move two hundred tothe scanning because the scan-ner has capacity for only 200containers
“According to him, the actual
An entrepreneur is aperson who makesplans for a business or
a piece of work and gets itgoing. Anyanwuocha (2001)observes that the entrepreneuris the chief co-ordinator,controller and organizer of theproduction process. Theentrepreneur combines otherfactors of production (land,capital and others) in such away as to obtain maximumproduction of goods andservices at minimum costs. Inorder to effectively enhanceoccupational skills in thepresent day, entrepreneursneed also to acquire
Vocation and Technical
Education – A key to improving
Nigeria’s development. part 3
information andcommunication technologyknowledge and skills. Mkpozi(1996) observed that a countrythat is developing andmanufacturing its own goodseither from Hi-Tech or small/medium scale industries usingindigenous skills and exportssome of those goods to othercountries is usuallyeconomically stable. Thiscould be better achievedthrough the acquisition ofentrepreneurial andoccupational skills intechnology and vocationaleducation. Individuals withtechnical and vocation skillsand good knowledge of ICT arecharacterized by self-reliance,self-employment and fitproperly into today’s technical,entrepreneurial and businessworld.
The entrepreneur shouldtherefore possess technicalskills, ideas and managementskills which are necessary forthe success of the venture. Oneof such skills is informationand communication
technology which ischaracterized by employeeempowerment and involvesthe making of unskilled andsemiskilled workers to beskilful and functional intoday’s world of work. It alsoinvolves the development oftask oriented team of workerswho no longer depend onindividual managers for alltheir decisions to achievetargets. Technical process re-engineering are alsorequired to redesigntechnical work processes,jobs, organisationalstructure, managementsystem, and also in processdesigns using inmanufacturing industries.
These components of ICThave great implications forthe enhancement ofentrepreneurship educationin technology and vocationaleducation field of work.According to Azuka, Nwosu,Kanu and Agomuo (2006),classroom behaviour mustalign with ICT- drivenenvironment which isconstantly shaping and re-shaping the work place andconsequently, what is learntand how learning takesplace.
There are various numbersof opportunities fortechnology and vocationaleducation graduates withentrepreneurship skills inICT driven technical andvocational educationenvironment. Theseopportunities exist in variousforms for the enhancingentrepreneurship skills.Nwabuona (2004) viewsentrepreneurship educationas the identification of thegeneral characteristics ofentrepreneurs and howpotential entrepreneurs canbe trained in managementtechniques needed foreffective performance ofpersons for long timesurvival of an organisationafter the acquisition ofoccupational skills.
Therefore, the rolestechnology and vocationaleducation in enhancement ofentrepreneurship skills is toidentify and equippedgraduates with critical wealthof skills, technicalknowledge, and a goodmeasure of self-confidenceusing information andcommunication technologycompetence.
Technicalprocess re-engineering arealso required toredesigntechnical workprocesses, jobs,organisationalstructure,managementsystem, and alsoin processdesigns using inmanufacturingindustries
,,
The CAC re-minded themeeting thatthere was a timein Apapa thatcontainersbooked for ex-amination in theevening waspositioned thenext day forexamination
*Executive Governor, Anambra State, HE Peter Obi and Executive Director, Diamond BankPlc, Mr. Uzoma Dozie at the BusinessDay Annual Banking Awards held at the Eko Hotel andSuites recently. Diamond received the award of the Most Customer Friendly Bank at the event.
CMYK
Vanguard, MONDAY, JUNE 17, 2013 — 19
Cover
,
,Crisis brews at port as accusations, denials trail destination inspection
Continued from page 18
Where is Nigeria's industrial policy Mr. President?
•President Goodluck Jonathan
Nigerianeeds a long-termindustrialpolicy that nogovernmentthat comes topower willchangeovernight
scanning of a container takesonly about two minutes but ifyou factor in the waiting timeof truck and the time requireddriving through and drivingout of the facility, you’ll needan average of six minutes pertruck. That means 10 contain-ers can be scanned per hourand while there are two scan-ners at the scanner site in Apa-pa; only one is used per time.For instance, the fixed scanneris used during the day and themobile scanner at night. Let usassume that the scanning op-eration is run for twenty hoursper day - and that is reallystretching it - it will mean 10containers multiplied by twen-ty which implies 200 contain-
ers.“So you see, it is a capacity
issue. Not our capacity or non-availability of equipment asthey lie to Nigerians, but thecapacity of the scanning system.That is what gave birth to the200 containers that was agreedto be scanned per day and weagreed to support that processvoluntarily by providing the lo-gistics for it. There is need tohonour the agreement of stick-ing to scheduling not more than200 containers a day for scan-ning so as not to jeopardise thehelp APM Terminals is provid-ing to importers in getting theirboxes scanned.
Of course, in the past fewweeks, the powers that be havefailed to respect the agreement
and have consistently pushedmore than 200 containers forscanning. And that is the gen-esis of the problem. We are notagainst the review of thenumber of the containers thatare scheduled for scanning butall the parties’ concerned needto sit together and agree on howto go about it because it hashuge implication on logistics.The signed agreement must berespected or we will withdrawour support and allow them doit the way they were doing itbefore now. The implication willbe the return of queue at thescanner site. Trucks will proba-bly line up for three to four daysto get scanned and of course,that means huge financial im-plication for importers and
agents. “So you see, it is a ca-pacity issue. Not our capacityor non-availability of equip-ment as they lie to Nigerians,but the capacity of the scanningsystem. That is what gave birthto the 200 containers that wasagreed to be scanned per dayand we agreed to support thatprocess voluntarily by provid-ing the logistics for it.
“Again, it is not about APMTerminals. It is about the capac-ity of the logistics and the scan-ner. What is ideal at present,which subject to review in fu-ture after several other factorsare considered, is 200 contain-ers per day. We have to stick tothat because the number wasarrived at scientifically”.
On the move for expansion,
the media practitioner said thatthe terminal does not need tobe expanded, but it is scanningmachines that need to doubled“For instance, if they can pro-vide three scanners to work atthe same time, that will make ahuge difference.
You may then begin to consid-er scanning up to 600 contain-ers a day. On our part, we haveinvested heavily in developingour terminal. It may interest youto know that the terminal is nowat par with any developed ter-minal in Europe and America.
We achieved all of this in lessthan six years. We have invest-ed over $200 million in acqui-sition of modern cargo handlingequipment, people, processes,technology, construction worketc..
A productive economy is one that is based on solid manufacturing. A wellplanned industrial policy enables nations to focus on areas they have acomparative advantage and develop the value chain along that line. Ni-
geria has not had a comprehensive industrial policy. In fact, in several aspects,the nation in its quest for development has no sectoral policy direction.
In the energy sector, there is no comprehensive energy policy to guide thenation on where investments are needed in line with industrial development.That is why today there is no sufficient power supply even to areas where there isconcentration of industries. It is the same reason that a successive governmentusually dumps the predecessor’s economic policy. This is why there is no conti-
nuity in economic policy in thecountry. In the past, govern-ment went into heavy indus-tries for the sake of it withoutstating its goals, programmes,the needs the industries wereto meet and their linkage ef-fects.
The various iron and steelcomplexes that were builtduring the military era arenow a burden to the country.Nigeria instead of promotinglight industries went intoimport substitution thatrequired importation of basicraw materials. Nigeria’spolicymakers without a clearhead, imposed the StructuralAdjustment Programme onNigerians with emphasis ontrade liberalisation. Nigeria,they knew had a weakproduction base, yet theyembraced trade liberalisationwhen Nigeria had little to sell.The gate was wide open to allmanner of goods. Asians andothers found their way in withtheir cheap and inferiorproducts and the rest ishistory. With high level ofdumping of products into theNigerian market, the fewexisting manufacturingcompanies started folding upand today, Nigeria stands therisk of de-industrialisation.
Nigeria’s once vibrant textileindustry was the first victim.Many operators in the sectorrelocated their manufacturingplants, some to Ghana andothers exported theirmachineries back to India. Theprocess of de-industrialising
Nigeria started to take root. Itis shameful that after 53 yearsof independence, Nigeria hasno comprehensive industrial,energy or manufacturing pol-icy. It is equally a shame thatNigeria is exporting raw ma-terials and importing sameback in finished products athigher price level. Why thenare Nigerians complaining ofrising poverty andunemployment? Nigeria hasno say in the price of theprimary commodity it exportsto other countries. The pricesare determined at theinternational commoditymarket but the prices ofmanufactured products aredetermined by themanufacturers. Is it not ashame to Nigerian leaders atwhatever level, that 53 yearsafter independence, Nigeria isan exporter of crude oil andimporter of finished petroleumproducts? Is it not shamefulthat Nigeria still exports rawcocoa and imports chocolate?
Is it not shameful thatNigeria sells raw cotton andimports clothing? Worse still,Nigeria imports tooth pickswhen there is a lot of bambooin our forests. The hall markof Nigeria’s economy ispersonal programme ofwhoever comes to power. Inthe last 14 years of civilianrule, we have had one eco-
nomic policy after another.First it was President Oluseg-un Obasanjo who introducedthe National Economic Em-powerment DevelopmentStrategy. It was well articulat-ed and Nigerians bought intoit. As soon as Obasanjo leftoffice and Umaru Yar’Aduacame into power, the NEEDSdocument was dumped andNigerians were inundatedwith Seven-point agenda notminding that both presidentsare from the same party - PDP.As if that was not bad enough,when Yar ’Adua passed on,
and President GoodluckJonathan took over the saddle,though part of the Yar’Aduagovernment, he dumped theSeven-point agenda only tocome up with his Transforma-tion agenda. In all of these,no national economic pro-gramme that has a legal back-ing that no single individualcan throw off.
Nigeria needs a long-termindustrial policy that nogovernment that comes topower will change overnight.It is the personalization ofeconomic policies in Nigeriathat has given rise to the highlevel of poverty in the countryas many leaders are directingthe economy as their spiritleads.
This is unfortunate butmust stop. If Nigeria is toprogress, value addedproduction with priority onlocal content must beencouraged as a matter ofpolicy and strategy. Anyindustry that is to be set upthat has low local contentshould not be allowed. This iswhere an industrial policy isurgently needed. The NationalAssembly must rise to the oc-casion by putting the econo-my above political leaningsand give the nation nationalindustrial policy that everypresident can be held by.
By NAOMI UZOR
20 — Vanguard, MONDAY, JUNE 17, 2013
CMYK
Business & Economy
BRIEF ‘SMEs part of Germany’s success secret’
...provides about 70% of jobs
THE Minister of Power,Professor Chinedu
Nebo, has said that Nigeriain its quest for new energymix strategy would leverageon Turkish expertise inThermal and Hydro powersources. The minister, whowas represented by thePermanent Secretary,Ministry of Power, Amb Dr.Godknows Igali, said thatNigeria offers the bestenvironment for business notonly in power, but also inheavy equipment,machineries and construction.
Speaking in Abuja whilereceiving the Bereket energiGroup led by its DeputyChairman, Ali Yagli and theNigerian partner -OralEnergy Limited (the coreinvestor of Jos DISCO), theminister commended thegroup for the confidence ithas in the Nigeria economy,saying that the Group wouldnot regret its decision as thereare unequal potentials interms of returns oninvestment.
He described their visit asthe best timed against thebackdrop of the shift inemphasis on hydro renewablelike wind, solar and coal topower, with the enormouscoal reserves that stretchedfrom Enugu-Kogi-Benue andNasarawa States. Nigeriashould harness thesepotentials to the fullest as ourcoal has been described as oneof high quality. On thegroup’s request for moreparticipation in Nigeria’spower market, the ministerassured the Turkish companythat other renewable like solarenergy, wind are alsoavailable for exploration.
Responding on behalf of thegroup, Tukur Modibo, whorepresented, Alhaji YayaleAhmed, the Chairman of OralEnergy Ltd, said that theBereket energi of Turkey hasbeen a dependable ally in theon-going privatisation of thepower sector. He said thegroup has enormousexperience that has helpedthe Nigeria partner toeffectively operate in sixstates with three millioncustomers through its JosDISCO. With that successstory, the Turkish group isready to go into powergeneration.
Limited, leading provider ofOffice Automation Solutions inNigeria, has launched itsDocument ManagementSolutions to assistorganisations in digitising andmanaging paper documents,while empoweringorganisations to access theirpaper documents fromanywhere and at any time.
Establishment is yet to comeinto force. The citizens ofECOWAS are among the mostmobile in the world, and trendsindicate that they mainlymigrate within the ECOWASregion.
Panabiz enables ‘paperlessoffice’ via documentmanagement
Panabiz International
Persons, which establishes theright of residence andestablishment. The first phaseof the Protocol, which becameeffective 1980, guaranteed freeentry of citizens from Memberstates without visa for 90 days.The second phase of theProtocol, dealing with Right ofResidence, became effective inJuly 1986. However, Right of
THE African DevelopmentBank, in partnership with
the Economic Community ofWest African States(ECOWAS) Commission, isorganising a brainstormingworkshop on commonmigration policy for ECOWASthis week. The workshop,which will be held at theNovotel Hotel in Dakar,Senegal, will serve to guide thedevelopment of a modern daymigration policy that respondsto the aspirations of theregion’s citizens and conformsto present-day realities. It willbring together officials frommember states and expertsdealing with migration policyissues.
The 15 member ECOWASCommission was established inMay 1975 to promote anintegrated socio-economicspace for the region’s citizens.One of ECOWAS’ objectives isto enable the free movement ofpersons, goods and services. In1979, the ECOWASCommission adopted theProtocol on Free Movement of
AfDB, ECOWAS organise workshop on improvedregional mobility, integration
savings of N127 billion; generation of3million jobs within the next three yearsthrough direct employment by stakeholdersoperating within the value chain and itsmultiplier effect; industrial developmentthrough creation of about 3,000 cassavaprocessing small and medium enterprises;reduction in the cost of bread by 15 per centin the short run and greater reduction inthe long run as well as establishment ofabout 19,350 commercial bakeries withinthe next three years by entrepreneurs takingadvantage of new business opportunitiesand robust government incentives.
STAKEHOLDERS have foreseen a potential
annual foreign exchange savings of N127billion on cassava flour. Speaking yesterday atthe stakeholders seminar on cassava inclusionfor baking in Nigeria organised by the LagosChamber of Commerce and Industry (LCCI), theDirector-General of Federal Institute of IndustialResearch Oshodi, FIIRO, Mrs Gloria Elemo saidshe believes that the business community willbegin to see more opportunities in the industryand will have a potential annual foreign exchange
Cassava flour: Stakeholders foreseeN127bn annual foreign exchange savings
Nigeria toleverage onTurkishexpertise inenergy – Nebo
By EBELE ORAKPO
By NOEL ONOJA
Small and MediumEnterprises (SMEs)have been put for-
ward as part of the secrets ofGermany’s success.
The German Ambassador toNigeria, Her Excellency, FrauDorothee Janetze-Wenzel,made this known while deliv-ering a lecture at the recentinternational colloquium or-ganised by the Faculty of
Arts, University of NigeriaNsukka.
She said although Germa-ny is not endowed with re-markable natural resources, itis the largest economy in theEuropean Union and thefourth largest in the worldwith a Gross Domestic Prod-uct of US$3,342 billion due
mostly to education/research.“German research institu-
tions and private enterprisesare investing billions of Eurointo research (almost three bil-lion euros).
As a result, Germany is theleading European countrywhen it comes to patent reg-istration.
“Important sectors in theGerman economy are automo-bile construction, mechanicaland electrical engineering,chemicals, environmentaltechnology and nanotechnology.
"One of the secrets of theGerman success is the factthat alongside internationalcompanies, small andmedium-sized enterprises(SMEs) are the backbone ofthe economy and provideroughly 70 per cent of thejobs,” she said.
Quoting German’s FederalForeign Minister, GuidoWesterwelle, the Ambassadorsaid that Germany ’sresources “do not lieunderneath our feet butbetween our ears. The mostimportant resources in timesof globalisation are educationand research.
"We have the chance and theresponsibility to promote andto employ education andresearch well,” she said evenas she noted that anotherthing Germany has going forher is the fact that the aver-age German loves his/her joband so is able to put in his/her best.
*Enterprise Bank Executive Directors, Mr. Audu Kazir (right) and Mrs. Nneka Onyeali-Ikpe(2
nd left), welcoming back to Nigeria Mr. Chijioke Amamchukwu (2
nd right) and Mr. Chinonso
Agbasiere (left), the two loyal customers of the bank that were rewarded with an all-expensepaid return trip to Dubai. The customers were at the Head Office of the bank in Lagos recentlyon a ‘thank you’ visit.
CMYK
Vanguard, MONDAY, JUNE 17, 2013 — 21
Business & Economy
BRIEF
THE Small and Medium
E n t e r p r i s e sDevelopment Agency ofNigeria, SMEDAN, hasdisclosed plan to create fivemillion new jobs through itsNational EnterprisesDevelopment Programme,NEDEP, before 2015.
Director-General of theagency, Alhaji Bature Masari,while speaking at aninteractive session withjournalists in Abuja recently,said with NEDEP, it would beeasier to implement the OneLocal Government, OneProduct, OLOP, scheme acrossthe country.
Masari explained that“NEDEP would cover allstates of the federation andAbuja with a view toconducting survey of everyproduct being produced ineach local government as partof the strategies mapped outby SMEDAN to achieve thegoal.
“Our objective is that withinthe few years of implementingNEDEP and otherprogrammes to be initiated,we will generate an estimatedfive million direct and indirectjobs.
“I came here with amission. My mission is tocontribute immensely to thegrowth of MSMEs all over thecountry. MSMEs play thelead role in creating
additional employments,wealth generation andpoverty reduction”, hestressed.
The D-G added; “Part of ourstrategy is to create newclusters of businesses basedon competitive andcomparative advantagesalready identified through theOLOP initiative and rawmaterials mapping in the 774local governments.”
Masari informed thatSMEDAN, which will identifyskills of each youth, wouldwork in conjunction with theIndustrial Training Fund, ITFwhich would train them andthe Bank of Industry, BoI, forfinance.
He said the pilot schemehas started in Kano and Nigerstates, stressing that it wasdeveloped to create jobs,generate wealth and eradicatepoverty in the country.
This, he said, would be donethrough the micro, small andmedium enterprises, MSMEssector for effective skillstraining and acquisition aswell as business servicesdevelopment.
“Mr. President haspromised his continuedsupport for SMEDAN and weare ready to promote thegrowth and development ofMSMEs in the country.SMEDAN has just openednew offices in 11 states and
we want to cover all statesbefore the end of the year.
“SMEDAN is beingreorganised to make it moreeffective. The FederalGovernment is planning tolaunch the National Councilof MSMEs, comprising thefederal, state and localgovernments to manage theeconomy for rapiddevelopment of the country”,he said.
According to him, “if we aregoing to develop our economyand turn our quantityadvantage into productiveadvantage, one of the mostimportant sectors that wehave to focus on is the MSMEsector”.
Masari, however, said theagency would embark onaggressive awarenesscreation about its activities,especially at the grassroots toenable the populace benefitfrom its programmes.
SMEDAN creates newprogramme for 5m jobs
commence after we haveincreased the frequency of ourtraffic on the alreadyrehabilitated lines. We alsointend to open up new raillines and to start theconstruction of standardgauge lines which is our nextinnovation. Already, aboutnineteen stations have beenidentified for that purpose,”he said.
Nigeria Railway has beenoperating on the narrowgauge lines that do not allowfor optimum speed. Thisupgrade to wider standardgauge lines will allow formore speed efficiency.
Baraje who was on his firstofficial visit to the railwayheadquarters as the newchairman of the Board ofDirectors commended themanagement of thecorporation on their
THE Federal Government
has said it hasidentified about nineteenrailway routes that will beupgraded to standard gaugelines.
The newly appointedchairman of Board ofDirectors, Nigeria RailwayCorporation, NRC, AlhajiAbubakar Baraje stated thisduring an interactive sessionwith news men after anexperiential train ride fromEbute-Metta Junction to Ikejain Lagos.
“We intend to focus ourattention on the fullrehabilitation of the easternrail lines and that will
rehabilitation efforts as hepledged that his team willconsolidate on the groundworks already done.
“After all the places we havevisited and what we haveseen, the impression that wehave is that a lot of work hasbeen done and we intend tobuild upon that ground workalready done by theManaging Director, Engr.Adeseyi Sijuade and histeam. We would work withhim to sustain thetransformation agenda of thepresent administration inrevitalizing the railway,” hesaid.
Earlier he and his teamembarked on an inspectiontour of the different facilitiesof the corporation, where hevisited the local workshop,where the wheel-lessmachines are maintained, the
coaches and wagonsmaintenance workshop, thetraining school and therailway clinic.
On his assessment, he saidthat what he saw showed thatthere has been high level ofdecay because of the longyears of neglect.
“After over 25 years ofneglect, one cannot expectanything less. But thegovernment has renewed itscommitment to bringing backthe railway and we have beenseeing positive actions in thatregard. That shall continueuntil the railway will be fullyrevitalized,” he said.
He further disclosed thatthe corporation’s next focuswould be on the full revivalof the eastern axis afterincreasing the regular trafficon the already rehabilitatedwestern lines.
THE Registrar-General of
the Corporate AffairsCommission, CAC, AlhajiBello Mahmud has regrettedthat non-existence of a centraldatabase is a major challengeto ascertaining the veracity ofinformation people produce atthe point of registration ofcompanies in the country.
Alhaji Mahmud stated thiswhen the Managing Directorof Media Trust Limited, AlhajiIshaq Ajibola and his teamcame on a courtesy visit to theCommission.
He said CAC has come upwith a procedure such thatanyone who wishes toregister any company mustpresent valid means ofidentification such as nationalidentity card, driver's licenceor international passport.
The measure is to addressthe issue of fake address andother malpractices at the pointof registration as theCommission would now usebiometric data to trace suchpersons.
The Registrar-Generalacknowledged that the 24-hour incorporation ofcompanies at the Abuja andLagos offices of theCommission has been asuccess story. He reiteratedthat plans are in place toextend the same service to allthe Commission’s stateoffices across the nation.
He said the measure isaimed at creating aconducive atmosphere andfacilitating business in thecountry as well asindustrialize the country tomake it the hub ofinvestment. Mahmudexplained that theCommission has embarkedon public enlightenmentprogramme on the risks ofdoing business withoutregistration. To this end, hesaid arrangements havebeen put in place forenforcement and clampdownon fake and illegal use ofbusiness names.
He further stated that theCommission has put in placeprocesses to encourage theregistration of Small andMedium Scale Enterprises.
FG to upgrade 19 rail tracks to standard gauge
Lack of centraldatabase amajor problem— CAC boss
By JONAHNWOKPOKU
BY FAVOURNNABUGWU
BY FAVOURNNABUGWU
*From left: Mr.Habila Amos, HCIB, Administrator, CFS; Mr. Tade Fadare, FCIB, DeputyRegistrar, CIBN; Barr. P.O. Olanrewaju, FCIB, Chairman, CIBN Capacity-Building & Certifi-cation; Dr. Enase Okonedo, Dean, LBS; Mr. Segun Aina, OFR, FCIB, President/Chairman ofCouncil, CIBN; Chioma Nweke, Director, Executive programme, LBS; Dr. Nubi Achebo, MBADirector, LBS and Mr. Akin Morakinyo, Group Head, CB & C at the cooperation agreement forcollaboration on MBA/ACIB programme and CIBN CFS/LBS affiliation consummated betweenLBS and CIBN at Lagos Business School, Lekki Lagos.
22 — Vanguard, MONDAY, JUNE 17, 2013
CMYK
Banking & Finance
BRIEFS
INTERNATIONAL forex
broker ForexTime Ltd(FXTM), has just announcedthat they are launching an“Over-the-weekend (OTW)”account, where traders canenjoy swap-free trading fromMonday to Friday.
Running from 1 June to 31August 2013, the “OTW”account means that ForexTimeclients can benefit from tradingswap-free during the week onany trading instrument andthey will only be charged asmall weekend fee every Fridayat market close.
Olga Rybalkina, CEO ofForexTime, said: “At ForexTimeour priority is always to ensurethat our clients get themaximum value from the timethey spend trading. Inresponse to their growingneeds, we have launched theOTW account for the summerperiod,to give even more to thetrading experience.”
A forex rollover or swap is theinterest added or deducted forholding a position openovernight. The ForexTime OTWaccount allows clients to tradeswap-free and for positions tobe held for any length of timefrom Monday to Friday withoutincurring any additional fees orcharges.If clients choose toleave any positions open overthe weekend they will becharged a small weekend feeon Friday at market close.
The OTW account is one ofseveral initiatives byForexTime which puts tradersand the trading experience atthe heart of the internationalbroker’s operations.
FBN Holdings Plc has
projected a 20 percent returns on averageequity for the financial year2013, even as it pledgedsuperior returns to allstakeholders
The company alsodisclosed that it has
completed its holdingcompany structure asdemanded by the CentralBank of Nigeria (CBN) andwill continue to support theprivate sector through loandisbursement that would bechannel to the productivesectors of the economy.
Speaking on the factsbehind its figure for thefinancial year 2012 to
members of the capitalmarket community at theLagos floor of the NigerianStock Exchange (NSE), ChiefExecutive Officer, FBNHolding, Mallam BelloMaccido, said the company ispoised to consolidate its firstposition among Nigeria’sfinancial institutions.
According to him, “The 20per cent projection on returns
on average equity is basedon conservative figures. Weare first in Nigeria by totalassets, gross loans and totaldeposits, with strong localfranchise. We recorded totalassets of N3.186billion,representing a growth of11per cent from the 2012figure. For first quarter 2013,we recorded total assets ofN3,459 billion, representing agrowth of 16 per cent fromthe figure in first quarter 2012.Our gross loans stood atN1.581billion.
While commenting on itsfinancial performance,Maccido said, Gross earningsgrew by 31.4 per cent Year onYear to N360.3billion for 2012.It was primarily driven byinterest income from loansand advances (32 per cent ),and - investment securities(92 per cent ) as at 2012.
He stated that during thefirst quarter 2013, grossearnings was driven by an11.5 per cent increase ininterest income and 16.7 percent growth in non-interestincome; Non-interestrevenue for 2012 was drivenby fee and commission growthof 26 per This was largelydue to growth in commissionon turnover (57 per cent) andelectronic banking fees (77per cent ), accountmaintenance (66 per cent), aswell as funds transfer andintermediation (31 per cent).
The House of Representatives has revoked itsresolution calling on
the Federal Government toblacklist and prosecute a fore-most indigenous firm of char-tered accountants and taxpractitioners, Olusola Ade-kanola & Co., for alleged in-volvement in the petroleumsubsidy regime. A statement by the Mediamedia and communicationconsultant to Olusola Ade-kanola & Co., Mr. Kazie Uko,stated, " The decision by theHouse to quash the resolu-tion, a fall-out of recommen-dation by its ad-hoc commit-tee on fuel subsidy probe, wasas a result of petition by Olu-
sola Adekanola & Co., which,according to the House,showed that the accountingfirm was never in any wayinvolved in the subsidy re-gime before the investigationby the House and eventualcessation of service to its em-ployer, Federal Ministry ofFinance. According to the transcript ofVotes and Proceedings of theHouse, No. 98, datedWednesday, 5 June, 2013, theHouse in the Committee ofthe Whole chaired by the dep-uty speaker, Hon. Emeka Ihe-dioha, considered the reportof its Committee on PublicPetitions to reconsider theHouse resolution on the pe-
Fuel Subsidy: House of Reps lifts ban onOlusola Adekanola & Co
FBN Holdings projects 20% returnon average equity for 2013...Pledges superior returns for stakeholders
BY PETER EGWUATU &NKIRUKA NNOROM
FXTM launchesOTW account
•From left: Prof. Albert Alos, Lagos Business School; Mr. Segun Aina, OFR, FCIB, President/Chairmanof Council, CIBN and Dr. Enase Okonedo, Dean, LBS at the cooperation agreement for collaboration onMBA/ACIB programme and CIBN CFS/LBS affiliation consummated between LBS and CIBN at theLagos Business School, Lekki Lagos.
South Africaagrees torepatriate Libyafunds hidden incountry
South Africa said it willtrack and repatriate
Libyan funds and assets thatwere hidden in the countryduring the rule of dictatorMuammar Qaddafi. FinanceMinister Pravin Gordhanreached the agreement aftertalks with Libyan officials,including Usama al Abid,minister in the office of LibyanPrime Minister Ali Zaidan, onJune 4, according to astatement from the SouthAfrican finance ministry. Therepatriation will be doneunder United Nationsprotocols. Libya, which oustedQaddafi last year, is seekingthe return of overseas assetsafter the value of its sovereignwealth fund dropped. TheLibyan Investment Authority’sassets are about $57 billion,down from about $61 billion in2008, outgoing sovereignwealth head Mohsen Derregiasaid in March.
troleum subsidy report, as itaffected Olusola Adekanola &Co.The petition was presented tothe House by Hon. Uzo Azu-buike (Abia North/Abia SouthFederal Constituency).When the question was putto vote by the House Speak-er, Hon. Aminu Waziri Tam-buwal, who presided duringthe Plenary, the House adopt-ed the report and thereafterquashed the earlier recom-mendation and subsequentresolution to the governmentto blacklist and prosecute thefirm of Olusola Adekanola &Co. Olusola Adekanola &Co., had in various publica-tions protested its indictment
by the House of Representa-tives ad-hoc committee on pe-troleum subsidy regime,chaired by Hon. Farouk La-wan, declaring that it was in-nocent of the allegation ofwrong doing against it.“We hold the House of Rep-resentatives committee onfuel subsidy in high esteemand we are sure that it did nothave valid information withinits reach to premise its recom-mendations on. We are there-fore prepared to avail it infor-mation and evidence to assertour innocence on this subject”,Otunba Olusola Adekanola,executive chairman of Oluso-la Adekanola & Co had an-nounced in one the publica-tions.
Vanguard, MONDAY, JUNE 17, 2013 — 23
Banking & Finance
BRIEF
Given the low level ofawareness byfinancial institutions
in Nigeria about the ForeignAccount Tax Compliance Act(FATCA), Ernst & Young, aleading global professionalservices advisory firm isputting together a Breakfastsession to update its clientsand key stakeholders in thefinancial services industryabout the new U.S.regulations and the burdenimposed on financialinstitutions in Nigeria.
The Breakfast event isscheduled to take place at theFour Points by Sheraton,Victoria Island, Lagos, onWednesday, June 26, 2013.
Commenting on the event,Mr. Adekunle Salau, Partnerand Advisory Leader for WestAfrica, Ernst & Young, said,the goal of FATCA is to reduceU.S. tax evasion by enablingthe U.S. Internal RevenueService (IRS), to obtaininformation regardingworldwide income of U.S.persons, adding that thelegislation came in responseto a series of cases in whichsome international bankswere alleged to have helpedtheir clients evade taxes.
According to Salau,financial institutions aroundthe globe now face a complexand onerous complianceburden in order to meetFATCA requirements.
“Full implementation ofFATCA is fast approaching,and many financialinstitutions in Nigeria haveeither not started or just heardof FATCA, but are not awareenough of what to do next. InSouth Africa, the big banksare ahead of the game incompleting an impactassessment and optimizingsolutions while in the rest ofAfrica, FATCA is mainlyunheard of. In Europe andthe Middle East, a lot of thelarge and global financialinstitutions have eitheralready completed theirFATCA impact analysis or arealready in the solution designstage”, he informed.
The primary target audiencefor this event will includeChief Financial Officers,Chief Compliance Officers,Chief Risk Officers as well asChief Operating Officers oftop banks, insurancecompanies, investment/fundmanagers as well asregulators such as CentralBank of Nigeria, CBN,Nigeria Deposit InsuranceCorporation, NDIC,Securities and ExchangeCommission, SEC andNational InsuranceCommission, NAICOM.
Deloitte increases investment in Nigeria
As a demonstration ofits commitment to theNigerian and African
market, Deloitte, one of theleading professional servicesfirms in the world, hasannounced the formation of anintegrated practice acrossAfrica with Nigeria playing astrategic role in the newgrowth process. Theestablishment of theintegrated Deloitte Africa andthe dedicated investment inNigeria by Akintola WilliamsDeloitte (AWD) will ensure
clients are served seamlesslyin Nigeria and across theentire continent.
Lwazi Bam, the CEO ofDeloitte Africa, asserts that aspart of this integration,Deloitte has designatedNigeria a “Priority Market.”“As a Priority Market, AWDwill receive substantialfinancial investments aimedat enhancing the quality andbreadth of services providedto its local and cross borderclients. This will leverage offthe great depth of expertise
already on the continent andacross the globe” he aded.
As part of these expansionplans, AWD also announcedthe formation of a newgovernance Board and theappointment of OlufemiAbegunde as the Chairman.Olufemi Abegunde currentlyleads the firm‘s Oil & Gaspractice. Tawanda Gumbowho previously was the CEOof Deloitte Zimbabwe/Malawiand has most recently beenthe leader of the ConsumerBusiness practice in Nigeria
will serve as the TransitionalLeader. The current CEO ofAWD, Adeniyi Obe, will beretiring at the end of themonth.
According to TawandaGumbo, Transitional Leaderof the firm, “Mr. AkintolaWilliams, Nigeria’s firstchartered accountant,founded the firm more than 50years ago,” Abegunde said.“He had the wisdom to bringus into the Deloitte network,and we are now one of theleading professional servicesprovider in Nigeria. We haveevolved from our proud rootsof being an indigenous firmto a world-class practice. Mr.Williams is very proud of thisnext stage in our evolution.”
It should be noted thatDeloitte has a presence in 34countries in Africa and thesefirms have been clustered intoEnglish, French andP o r t u g u e s e - s p e a k i n gareas,and also the MiddleEast aligned firms in Africa,to better facilitate the servicedelivery to our clients.Deloitte is very fortunate toalready have very wellestablished practices acrossthe African continent, withmost of them being theleading firms in their markets.The legal integration of thesefirms will move Deloitte intoa completely different league,further cementing its marketleading position in Africa.Deloitte in Africa isrepresented by over 350partners, over 6 000professional staff andrevenues in excess of US$ 664million.
CIBN partners FITC to enhancecompetence in banking industry
BY PROVIDENCE OBUH
In a bid to bridge thegaps in the banking andfinance industry, the
Chartered Institute ofBankers of Nigeria, CIBN hasconcluded arrangements tocollaborate with FITC toimprove the competency levelin the sector.
This is coming on the heelsof the stakeholders’engagement with thecompany at its Corporateheadquarters in Lagos, led byPresident/Chairman ofCouncil, Mr. Segun Aina.
Aina said that theengagement was part offamiliarization and bridge-building efforts to dialogue
with major stakeholders in theBanking and Financeindustry.
He observed that theindustry was so large andreplete with many valueadding opportunities suchthat there was room for eachof the two organizations tomake its own impact withoutany hindrance. He called forcollaboration and cooperationbetween CIBN and FITC inareas of common goals andinterest.
He said that the CIBN newCentre for Financial Studies(CFS) was a strategicinitiative of the current regimewhich was established toprovide thought leadershiparound emerging issues inthe industry.
He stressed that the CFSwill not engage in traditionalmass market training but willfocus on organizingknowledge based events suchas roundtables, guest speakerseries, breakfast sessions,public lectures etc in order togenerate new ideas that wouldbe distributed to practitionersin the Banking & FinanceIndustry adding that CFSwould be involved in researchactivities as well as collaboratewith reputable Institutionsboth locally andinternationally.
Managing Director, Dr. LucyNewman expressed delightwith the visit, even as shewelcomed the institute’sproposal on research saying,“it required huge amount ofresources and time.”
Ernst & Youngcreatesawareness onFATCA
*Mr. Ladi Balogun, HCIB, Managing Director/CEO, FCMB Plc presenting a souvenir to Otunba (Mrs) Debola Osibogun, 1st
Vice-President & Chairman, Planning and Organising Committee of CIBN 50th
Anniversary during the visit by the members ofthe Consultative Committee on 7
th Annual Banking and Finance Conference & Anniversary committee to the bank last week.
24 — Vanguard, MONDAY, JUNE 17, 2013
CMYK
Corporate Finance
BRIEF
SHAREHOLDERS under
the aegis of IbadanZone ShareholdersAssociation, IZSA, have calledfor a review of tenure ofmembers of audit committee ofquoted companies to a periodof three years.
They also said that there isneed for the Securities andExchange Commission, SEC,to review the cost of registeringproxies and stamp duty cost.
The association’s chairman,Chief Sola Abodunrin, madethe call while presenting apaper ‘Election into AuditCommittee: NigerianExperience’ at a one-dayseminar put together by theassociation to upgrade theknowledge of its members onthe roles and responsibilitiesof audit committee members.
He stated that the tenureelongation from one yearperiod initially allowed wouldstabilise the committee andmake for continuity in theperformance of their duty.
Abodunrin, however,regretted the fact that thoseseeking election into auditcommittee are not financiallyliterate to successfully performthe role, saying thatqualification for election intoaudit committee in Nigeria isbased on nothing other thannomination within 21days ofannual general meetings andvoting.
According to him, “There isneed therefore to formulateconditions precedent asqualification for whoever isseeking election as auditcommittee member.Companies must not bepartisan on who is elected asaudit committee member andall necessary facilities must beprovided to back up the auditcommittee.”
Also speaking at the event,Mr. Soji Arimoro, a charteredaccountant with Baker TillyNigeria Ltd, said that there isneed for companies to investon training of audit membersto empower them withnecessary skills to carry out theduty effectively.
He insisted that it takescommitment, high sense ofresponsibility and high levelof integrity for members tosucceed in their duty ofassisting the board ofcompanies in financial controland reporting, internal control,corporate governance, as wellas ethics and whistle blowing.
AS equities listed onthe NigerianStock Exchange,
NSE, continue to recordupward movement, stockmarket analysts are afraidthat the current rally may notbe sustained as most of thestocks that have recordedhigh returns this year maynot be supported by adequatefundamentals.
Over the past one year, thestock market has been on aroller coaster, beating theexpectations of those that hadprojected that the 2008meltdown would take a littlelonger to ebb. Just in themonth of May, the NSE AllShare, ASI, Index has risenby nothing less than 7.64percent. From rock bottom ofN8 trillion in 2011, the NSE’smarket capitalisation hasrisen to over N12 trillionmarks, reaching almost theheight it was before themarket crashed. The AllShare Index has also crossedthe 39,000 basis points.
Analytst believe that therecent surge in the market,which comes after a slightpullback in April, has beendominated by bellwethers(the top 10 most capitalisedstocks have increased by anaverage of 8.8 percent in themonth). They noted that thedevelopment makes thecurrent rally a defensive onerather than a risk-on risk-offrally as was witnessed at thebeginning of the year.
Analysis of movement onthe share prices of
various companies acrossdifferent sectors showed thatthey have recordedunprecedented growth withinthe year. For instance, the topfive gainers in the market inthe last few weeks each roseby over 100 percent.Livestock Feeds for instancehas so far returned 773.52percent to investors as therally continues; Chemicaland Allied Products has risenby 334.62 percent; Eterna Plchas gone up by 202.27percent, May & Baker hasreturned 127.64 percent,while Neimeth has gone upby 140.38 percent. EvansMedical has recorded agrowth of 256 percent.McNichols recorded 179percent, while Wema BankPlc, Cement Company ofNorthern Nigeria Plcappreciated by 128 percentand 103 percent respectively.
Other stocks among the top10 that fetched investorshandsome capitalappreciation in five monthsinclude: Cadbury Nigeria Plc.(91 percent); United Bank forAfrica Plc. (86 percent); ABC
Transport Plc. (84 percent);PZ Cussons Nigeria Plc. (82percent); Forte Oil Plc. (81percent); Presco Plc (76percent); Lafarge CementWAPCO Nigeria Plc (67percent); Julius BergerNigeria Plc and InternationalBreweries Plc (62 percentapiece).
According to Mr. JohnsonChukwu, ManagingDirector/CEO, Cowry AssetsManagement Ltd, the stocksthat have appreciated inprices since the beginning ofthis year could be categorisedinto two – those supported bystrong fundamentals andthose that are appreciating asa result of relative pricing orripple effect.
“While it may be difficult atthe moment to say thatbubbles have built up in themarket, it is obvious thatthose stocks that appreciatedas a result of relative pricingare overvalued. “This meansthat at some point the markethas to go through a correctionso as to reflect the actualvaluations of such stocks.When the correction occurs,it will likely affect even thosestocks that are supported bygood fundamentals,”Chukwu posited.
He noted that it wasimperative for the
regulators of the Nigeriancapital market to lookout fortriggers of market crash suchas massive inflow of foreigncapital targeting a particularasset class; stock prices notsupported by earnings,scramble for equities by alland sundry, as well asavailability of cheap creditsand aggressive tightening of
monetary policy.Speaking in the same
vein, David Adonri,Managing Director/CEO,Lambert Investment &Securities Ltd, said thatseveral stocks have risenmeteorically during theyear.
He noted that eventhough a lot of the quotedcompanies are recordingimprovement in theirfundamentals andexpanding theiroperations, however, theirextraordinary growth isbeyond the strength oftheir fundamentals,adding that marketcorrection was a certainty.
He said, “A lot of hotmoney has flowed into theequities market givingcause for caution. Thestocks affected are those
so low over the years, sayingthat the rise in share prices ofcompanies that have recordedunprecedented growth isordinarily expected to be verysteep. He explained thatannouncement of results forcompanies with December yearends (most companies fall intothis category), a good numberof the results have also beenvery exciting, has added to theupward movement experiencedso far in the market.
“Yields on bonds have beendropping hence someinstitutional and internationalinvestors have beenrestructuring their portfolio infavour of equities, whilekeeping their excess cash intreasury bills pending recoveryof the bond market. We havehad inflow of funds from foreigninvestors (‘hot money’) findingtheir way into the capitalmarket,” he said.
For Mr. Bismark Rewane,
the Managing Director,Financial Derivatives Company,“Earnings are underway andthat could instill more volatility.All the while, the market islooking for a pullback. There arequestion marks as to whetherthe earnings will matchinvestors’ expectations.
There are already signs thatthe consumer goods companiesmight not meet expectations asthe brewery companies areshowing slowdown in sales anddecline in profit due to the highfinance charges.
There has also been weaknessin the earnings of agriculturalcompanies stocks due to a sharpdecline in commodity prices(mainly crude palm oil). Maybewe might see a slight pullbackin the second half of the yearbefore stocks mover higheragain.”
•Oscar Onyema
Shareholderscanvass 3yrstenure for auditcommitteemembers
Analysts, Stockbrokers doubtsustainability of equities rally
By NKIRUKANNOROM
that foreigninvestors arefamiliar with andinvest heavily in.They are mainlymu l t i na t i ona lmanufacturingcompanies.”
“The stockmarket moves incycles. We are atthe high pointnow; Marketcorrection is acertainty,” Adonriadded.
Also speaking,Mr. Wale Oluwo,an Economist andan independentanalyst, explainedthat the marketprices have been
,
,
While it may bedifficult at themoment to saythat bubbles
have built up inthe market, it is
obvious thatthose stocks thatappreciated as aresult of relative
pricing areovervalued
CMYK
Vanguard, MONDAY, JUNE 17 , 2013 — 25
Corporate Finance
The Chartered Instituteof Stockbrokers (CIS)
has admonished companiesin the power and housingsectors to seek listing on theNigerian Stock Exchange(NSE) and use the capitalmarket platform to raise fundsthat will assist them in theiroperations.
The President of CIS, Mr.Ariyo Olushekun, said thatthe Nigerian capital market isdeep enough to finance anyproject and called on
POOR PERFORMANCE:
Investors punish Evans Medicals,
ignore Premier Paints, Abbey Building
By BABAJIDEKOMOLAFE
Investors punishedEvans Medical Plc butignored Premier Paints
and Abbey Building SocietyPlc for the poor operatingresults announced last week.
The three companiesannounced the poorestresults out of the sixcompanies that announcedoperating results in the lastsix trading days, from FridayJune 7
th to Thursday June
13th
. While the share pricesof the Premier Paints andAbbey Building remained thesame, Evans Medicals lost 52kobo. Premier Paintsremained N10.93 kobo pershare despite 20,000 unitstraded on Tuesday, while
Abbey Building remainedN1.50 per share despite 100units traded on Thursday.
Evans Medicals recordedmixed performance in theresults of its 2012 operatingyear announced on Tuesday.The results show that revenuewent up by 6.3 per cent toN4.86 billion from N4.57billion. Gross profit also roseby 19.8 per cent to N2.6billion from N2.17 billion.But its profit before tax fell by19.2 per cent to N197.8million from N245.1 million.This was occasioned by 56.7per cent increase inadministrative cost, and 27.98per cent increase in financecost. While administrativecost rose to N986 million fromN629 million, finance costjumped to N503.4 millionfrom N393 million.
In spite of this, thecompany recorded profit aftertax of N284 million, up by63.2 per cent from N173.5million, courtesy tax writeback of N86.6 million. Inresponse its share price lost52 kobo between Wednesdayand Thursday. From Openingprice of N3.68 on Tuesday, itfell to N3.16 at the close oftrading on Thursday.
Premier Paints announcedits full year results for 2012which indicated N30 millionlosses after tax. This howeverrepresented 50.7 per centimprovement compared to theN61.3 million losses after taxrecorded in the previous year.The losses was despite 41 percent increase in grossearnings which rose toN257.88 million from N182.7million in 2011. In fact the
company recorded 75 percent increase in gross profitfrom N39.6 million to N70.3million. This was howeverwiped off by selling/distribution cost,administrative expense andfinance cost totaling N113.6million. The major threat tothe company’s profitabilitywas its selling/distributioncost which rose by 40 per centto N38.1 million from N27.1million, and itsadministrative cost of N64.8million, which accounts for 57per cent of total operatingcost.
Abbey Building Society Plcon its part suffered decline inall its performance indices inits operations in the firstquarter of 2013. Its Q1 2013results submitted to theNigeria Stock Exchangeshowed that gross earningsfell by 11.7 per cent to N447million from N506 million inthe previous quarter. Its profitafter tax fell sharply by 80 percent to N19 million from N95million. The sharp fall in themortgage company ’sprofitability was prompted by20.3 per cent decline in its netinterest income, which fell toN283 million from N354.7million in the previousquarter. This was occasioned14.3 per cent decline ininterest income and 4.2 percent increase in interestexpense. Interest income fellto N400 million from N466.8million, while interestexpense rose to N117.3million from N112 million.The company’s performancewas also worsened by loanwrite-off of N95.4 million, upby 31.9 per cent from N72.2million in the previousquarter. Other companies thatannounced operating resultswithin this period were UnionBank of Nigeria, CourvilleBusiness Solutions Plc, SkyeShelter Fund, and TranscorpPlc.
CIS seeks listing of power, housing sectors on NSE… Holds 2nd annual workshop
By PETER EGWUATU
companies in the power andhousing sectors to list on theexchange to be able to takeadvantage of the capitalmarket to boost theiroperations.
He further disclosed thatthe CIS would be organizingits second annual workshopon July 2
nd , 2013 in Abuja ,
which will attract bothgovernment and privatefunctionaries to brainstorm onissues that affect the powerand housing sectors and howthe capital market can helpprovide the needed fund toboost the sector and theeconomy in general.
He disclosed that aboutN3.4 trillion is lying idle withthe Pension FundsAdministrators (PFAs).According to him, “ThePension Commission(Pencom) told the CIS thatN3.4 trillion is lying idle withthe PFAs and challenged thestockbrokers to come out withgood products where suchfunds could be invested. Soour market has the capacityto finance any project.Transcorp is already in themarket and raising moneyfrom the market, so is someother companies raisingfunds through the private
placement because they donot want to expand theirshareholdings.
The Chairman of the CIS2
ND National Workshop
Committee, Mr. AlbertOkumagba, who wasrepresented by Mr. Bisi Oni,a technical committeemember of the workshop at apress briefing held weekendin Lagos, said “the workshopwill help in addressing issueson power and housing andalso unlock the economy.
According to him, “TheMinister of power has agreedto preside over the breakfastmeeting, while chairmen ofthe sessions on the theme.
BRIEFCadbury Niginvests $100min facility,capacityupgrade
Cadbury Nigeria Plc hasdisclosed that it has
spent a total of $100 millionin upgrading its facility inpursuit of the desire toincrease output inaccordance with growingdemand for its product.
The Managing Director/CEO, Mr. Emil Moskofian,made the disclosure duringa facility tour of theconfectionery manufacturingcompany and launch ofCadbury
Bournvita 500g pack and500g refill pack, Friday, inLagos.
Emil said that anadditional $300 millionwould also be spent in thesecond phase of theupgrade, adding that themanagement aimed toincrease its capacityutilisation and also satisfyincreasing demand forCadbury with the additionalinvestment of $300 million.
He further disclosedCadbury Bournvita recentlyreceived endorsement fromNutritional Society ofNigeria, NSN, the secondendorsement so far from thesociety in five years, sayingthat it was a confirmation ofthe ‘the care we take in ourproduction and processesand nutrition credentials ofthe product.
According to him, CadburyBournvita is the only fooddrink endorsed by NSN inNigeria.
“The process ofendorsement of CadburyBournvita by NSN took over12 months; they were with usthroughout 2012. Theychecked everything,including our processes,quality standard, inspectionof the raw materials andfacilities, including theproduction process and atthe end, they were able toconfirm that our productmeets internationalstandard.
“Cadbury is known withquality and we are not goingto jeopardise that; atCadbury Nigeria, safety,quality and hygiene are topon our priority,” he said.
Speaking on the newupsized Cadbury Bournvita500g jar and 500g refill pack,Moskofian said, “Thisupsizing to 500g pack isaimed at adding more vitalityto our consumers, givingmore value with everypurchase of CadburyBournvita.”
By NKIRUKA NNOROM
26 —Vanguard, MONDAY, JUNE 17, 2013
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Vanguard, MONDAY, JUNE 17, 2013 — 27
CMYK
Homes & Housing Finance
BRIEFS
ACTIS has announced
plans to mobilisefunds valued at about $1.5billion (N240 billion) to beinvested in the Nigerianproperty and real estatesector.
According to KevinTeeroovengadum, Director ofActis, the company plans toinvest in projects includingshopping centers, officetowers, and industrial parksthat will come to fruition overthe next five years. He saidthe fund will consist ofproceeds from its secondAfrican real estate fund thatraised $280 million inOctober, with the rest of theinvestment coming fromcommercial partners andloans.
Teeroovengadum said thecompany has alreadyinvested the proceeds of aninitial $1.55 million real estatefund in malls and officebuildings in Nigeria, Ghana,Kenya, Botswana andMauritius.
FEDERAL MortgageBank of Nigeria(FMBN) is targeting
an inflow of up to $2.5 billiondiaspora money into theNigerian housing sector, byintroducing products that willencourage Nigerians livingabroad own houses in thecountry. This is even as thefederal government istargeting the development of200,000 housing units in the
next five years with theproposed MortgageRefinance Company (MRC).
Managing Director, FMBN,Mr. Gimba Ya’u Kumo,disclosed this at the 4
th
Nigeria DevelopmentFinance Forum held recentlyin Washington DC. He saidin a statement, “The target ofthe inflow of diaspora moneyto Nigeria is about $10 billion.If the housing sector takesabout 25 per cent of thatinflow, we are expecting thatabout $2.5 billion is coming to
us in the form of inflow fromNigerians in the diapora thatwould need houses andinvestments in the housingsector. That would translate toabout N400 billion and withthat we can fund mortgagesand build about 30,000housing units. That would bean opportunity for those whowould want to have houses inNigeria. This is within theenvelope that we are allowedto operate which is N15million or $90, 000.”
According to the statement,
Ya’u Kumo further said thebank was working onmodalities to launch adiaspora product to assistNigerians living abroad whodesire to own houses in thecountry adding that the movewill also go a long way inreducing the nation’s housingdeficit.
“We realised that about17million Nigerians are livingoutside the country and mostof them have plans to havehouses and they have notbeen able to do so. Weunderstand that over theyears, people who have beenremitting money for buildingor buying of a house have notbeen getting good results.Stories have followed thismoney. What we are trying todo is that by the time wedevelop the Diasporamortgage model, it will be amodel whereby Nigeriansliving abroad who want to buyhouses can resort to FMBNand at the end of the day ifthey do not take themortgage, they can get refundof their money with interest,”he stated.
The FMBN boss said thebank chose the US as the focalpoint because 58 percent ofthe 17 million Nigerians allover the world are living inAmerica. “We are going to doour case study here and in theUK. If it works well, we willtry to replicate it in Asia andother parts of the world,” headded.
Meanwhile, the federalgovernment is targeting thedevelopment of over 200,000low-cost housing units withinthe next five years under anew mortgage financescheme aimed at addressingthe housing deficit challengein the country.
Minister of Finance andCoordinator of the Economy,Dr. Ngozi Okonjo-Iweala,speaking in Abuja, last week,at the presentation of the mid-term report of the Jonathanadministration, saidgovernment plans to achievethis with $300 million facilityobtained from the World Bankat zero interest, with 40 yearsrepayment period and tenyears grace period.
According to the minister,government is concerned thatit has become increasinglydifficult for young Nigeriansto own houses due to the highcost of mortgage financing,adding that the FederalMinistry of Housing has beendirected to work with amortgage finance institution todevelop ways that wouldmake it easier for Nigeriansto get mortgages at affordablerates.
in order to get a house. We want to eliminatethat”. Giving an insight into some of thepreparations for the commencement ofallocation, the governor stated: “We haveprepared forms, we have set up a LagosMortgage Board, we are recapitalising LagosBuilding and Investment Company (LBIC) togive mortgages, we have set up arbitrationrules, and we have gone through the mortgagedocument and so on and so forth. We haveprepared the draw rules, it is going to happenby draws to be made public. We have setguidelines for those who would be eligible,those who pay their taxes, so it will not do torush to go and pay the tax overnight becausewe built it with taxpayers’ money. We expectthat it is only fair that those who have beenpaying faithfully must get priority forsomething at this point.”
On affordability, Fashola stated: “We will notask you to pay cash once and for all. You willpay over a minimum of ten years, if you deposit30 percent as your equity of the value of thehouse that you choose”, the governor said,adding, “the sense of affordability is that, as Ihave always said, there is no low cost cementsold to government, there is no low cost ironrod. We borrow at the same interest rate ourcontractors charge us the import duties and allof the cost attendants to bringing in the rawmaterials to build the houses.
GOVERNOR Babatunde Fashola of Lagosstate has assured residents that at least
4,219 housing units, through Lagos HomeOwnership Mortgage Scheme, HOMS, built in12 locations across the state, would be ready forallocation before the end of this year.
Fashola disclosed this while rendering accountof his stewardship in the last six years through alive panel television interview, stating “definitely,before this year is over, we will start the processof allocating the houses, I assure you about that.”
He added that the housing units, some of whichhave been completed already, are located inSangotedo with 540 units, Ogba with 270 units,Shitta with36 units, Ilupeju with 60 units, Mushinwith 73 units and Agbowa, Phase 1 and 2 with660 units. Others which are currently on-goinginclude Ajara housing estate comprising 540 units,Ibeshe housing scheme comprising 720 units,Iponri comprising 144 units, Oyingbo, Phases 1and 2 comprising about 48 units and 120 unitsrespectively and Badia in Ijora comprising 1,008units.
According to Fashola, who said the allocationwould be by public draw, “We are almost done.What we are trying to avoid first is the need foranybody, any member of the public, to be arelation or friend of any member of government
FMBN targets $2.5bn diasporamoney for housing sector*FG targets 200,000 houses in 5 years with MRC
LAGOS MORTGAGE SCHEME:
Houses ready for allocation this year
•A typical site of mass housing development
By YINKA KOLAWOLE
By OLASUNKANMI AKONI
Actis to invest$1.5bn inNigeria’sproperty market
FEDERAL MortgageBank of Nigeria
(FMBN) is partnering withTrademore InternationalHoldings Limited to construct5,000 housing units for civilservants in Abia State.
Chairman of the firm, Engr.Emmanuel Mbaka, revealedthis at the foundation layingceremony of the estate, sittingon over 250 hectares of land,in Ngwu/Ubani Community,Uzoakoli Road, Umahia, AbiaState.
He said the idea of thehousing project wasconceived by the Abia Stategovernment in order to easethe housing problems of civilservants and self employedpeople of the state and alsoto bring housing andinfrastructure development tothe communities. He said theproject will be developed inphases with the pilot phasecontaining 1,000 housingunits to be completed withinthe first 24 months while thesecond and third phases willfollow subsequently.
Developer tobuild 5,000houses in Abia
By ADEBADE ADEJIMI,with Agency report
28 — Vanguard, MONDAY, JUNE 17, 2013
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Vanguard, MONDAY, JUNE 17, 2013 — 35
Business & Economy
W ith flood ravaging virtually every nation on earth
where there has been record rainfall, it is importantto issue a reminder to Governments and the people
of this country that the devastation this year is likely to beworse than what we suffered last year. Read last year’swarning first and wait for this year’s.
Floods and Famine – The Future
is here – 1
“400,000 farms; 36,000houses in Jigawa….inKduna..heavy rainfall sweptaway more than 300homes..”. PUNCH, September18, 2012.
For more than twenty years,climatologists andfuturologists have warned, anobviously deaf, world,especially the leaders of theadvanced economies –USA,China, Japan, all of Europe –that a major climate changewas inevitable and the conseences will be catastrophic forthe entire planet. They wereignored. Major internationalsummits aimed at findingsolutions to the problemsalready being created byclimate change, were oftenpoorly attended, or whenpresent, the powerfuleconomies routinely watereddown the resolutions, whichnecessitated revolutionarychanges in their life styles.US governments from Ronald
Reagan’s to George Bush, Snrand Jr, administrations, werenot only hostile to anysuggestions which wouldalter American patterns ofliving considerably, theyvehemently opposed theirimplementation. Suggestionsmeant to reduce high carbondioxide emission, which is adirect result of the continuoususe of fossil fuel (oil and gas),were ruled out. Even,President Bill Clinton madeonly the minimum effort toreduce global carbon dioxide– even though the US withless than three percent of theworld’s population accountsfor about twenty five percentof global carbon dioxide;China is second. Africa, aswhole, emits less carbondioxide than the US alone.But, poor and developingcountries will suffer all thesame because nature is not acourt of law which dispensesjustice as we know it. In other
words, life as we know it, isbeing threatened because theworld’s most powerful nation,America, is prepared to holdthe rest of us to ransom untilit is ready to change – whichmight be too late for themajority. At any rate, they
have already advanced plansto colonise the moon and,now, Mars.
Rising levels of waterresulting in flooding in areaspreviously not flood-prone,and drought in areas formerlyexperiencing good levels ofrainfall, as well as destructivetyphoon, hurricanes, cyclonesand tornados, were among thepredictions of scientists andfuturologists. Today, evenGeorge Bush, Snr and Jnr,must admit they were wrongand by delaying theimplementation of theprotocols aimed at avertingdisasters related to climatechange, they have imperiledmankind in general andAmericans in particular.Every single one of thesouthern coastal states, aswell as some inland states(e.g Texas) of America havebeen buffeted by tidal wavesand record rainfalls, resultingin heavy losses of lives and
properties and flooding.Simultaneously, the heatwave sweeping through theMiddle Belt states of the US,this year, is unprecedented inthe nation’s history in twohundred years. And, it mightnot be limited to this yearalone. Crops are either beingwashed away or they areshriveling on the farm. Nosoothsayer is needed topredict the worst harvest incenturies in God’s OwnCountry.
Nigeria’s story, this year, iseasily told. On September 14,several newspapers reportedfloods in Enugu, Anambra,Taraba and Kogi. OnSeptember 17, it wasCameroon dam waterdestroying 49 communities inCross River destroying farmsand homes. The same damfrom our neighbor hadinundated thousands of farmsin Adamawa State and sentunknown numbers of peopleinto early graves. Ogun, Oyo,Kano as well as twenty otherstates add to the list.
,
,
Poor anddevelopingcountries willsuffer all thesame becausenature is not acourt of lawwhichdispensesjustice as weknow it
Naira depreciatedagainst some major
international currencies at theofficial and parallel marketson Friday. At the officialmarket, the naira exchangedfor N241.19 to the poundagainst N241.18 that obtained
FG saves N254bn on cassavasubstitution for bread-baking
Minister ofAgriculture andR u r a l
Development, Dr AkinwumiAdesina, said Nigeria savedN254 billion through thesubstitution cassava flour inbread baking Adesina saidmade this known at the 2013Ministerial Platform, a mid-term report on the progressand achievements ofPresident GoodluckJonathan’s administration, inAbuja on Friday.
According to him, thecountry has also trainedmaster bakers on theapplication of the cassavaflour in bread baking. He saidthat government hadencouraged market growth byinstituting the 40 per centhigh quality cassava flourrequirements in wheat bread.He said investmentopportunity abound forinvestors to build newcassava processing plants tocapture share in the growingmarket.
“Processing is a highlylucrative segment of thecassava value chain. An initialinvestment of approximately30 million dollars is requiredto set up a plant with 75, 000 tonnes starch capacity or50,000 tonnes sweetenercapacity,” he said. Adesinasaid the Federal Governmentwas working to ensure thatsufficient cassava rawmaterials were available forintending processors. Hepointed out that governmentwould facilitate low interest
rates for processors and alsoimplement other financialincentives such as taxholidays and capitalallowances. The ministernoted that a number ofleading indigenous andglobal firms had indicatedinterest in the market forcassava starch in Nigeria.Adesina said that the FederalGovernment would establish‘Staple Crops ProcessingZones’ (SCPZ) across thecountry as incentive to theseinvestors.
“Government has decided toprovide the necessaryinfrastructure such asdedicated power lines androad networks and a one-
Naira depreciates against major currencies
on Monday. It lost N1.50kagainst the pound at theBureau de Change and theparallel market to sell atN246.5 to the pound fromN245 to the pound onMonday.
The naira also fell against
the euro at the official marketon Friday, trading at N206.74to the euro from N205.17which prevailed on Monday.The naira, however, remainedfirm against the dollar at theofficial market, selling atN155.25 since Monday. It
also firmed against the dollarat the Bureau de Change andblack market at N160 to thedollar. A currency trader, whopreferred anonymity, said thenaira’s depreciation was dueto the market forces ofdemand and supply.
stop-shop for business set upand registration. He said thatthe cassava subsector wasexpected to reach 8.5 billiondollars before the year 2020.
The Debts ManagementOffice ((DMO) says it
will sell Federal Governmentbonds worth N85 billion. TheDMO said in a statement titled“June 2013 FGN Bond OfferCircular ’’ posted on itswebsite that the bonds to besold include two five-yearand a 20-year paper.According to the statement,the first of the five-year bondsworth N25 billion will maturein April 2015 and the other
DMO offers N85bn bonds for sell
worth N35 billion will maturein April 2017.
It also said that the 20-yearbonds worth N25 billionwould mature in July 2030,adding that all the threebonds were reopened. TheDMO said the 2015, 2017and 2030 instrumentsattracted 4 per cent, 15 percent and 10 per cent interest,respectively at coupon rate.The sale is the sixth monthlydebt auction for 2013.
36 — Vanguard, MONDAY, JUNE 17, 2013
BRIEFS
Insurance
TO intensify insurance
penetration in thecountry, Standard Alliance LifeAssurance Limited, SA Life,said it is sponsoring atelevision programmeanchored by Almond Financeand Wealth Report which isgeared towards promotinginsurance awareness. Astatement by Mr. NelsonEgboboh, the company ’sHead of CorporateCommunication, said thesponsorship of the programmewhich is aired on MITV andSilverbird Television everySunday and Thursdayrespectively shall cover thenext thirteen weeks from thesecond week in June.
Egboboh said the desire ofthe company to ensure that noform of losses suffered stopNigerians from still living theirlives fully and the need toenlighten the public on thecrucial role insurance playsin the economic stability of anynation informed theorganisation’s decision tothrow its weight behind theinsurance awarenessdeepening televisionprogramme
on behalf of the association ata media parley in Lagos, saidthat the Association membercompanies have all compliedin line with the deadline setby the National PensionCommission (PenCom).
He said, “On InternationalFinancial Reporting Standard(IFRS), the compliancedeadline for all operators wasDecember 31, 2012. A numberof our members annualaccounts are already out,
THE accounts of Pension
Fund Administrators(PFAs) are now InternationalFinancial Reporting Standard(IFRS) compliant, the PensionFund Operators Association ofNigeria (PenOp), has said.Managing Director LegacyPension Managers Limited,Misbahu Yola, disclosing this
which are in compliance withthe IFRS. We have allcomplied”. IFRS areprinciples-based standards,interpretations and frameworkadopted by the InternationalAccounting Standards Board(IASB). Its overall objective isto create a sound foundationfor accounting standards thatare principle-based, internallyconsistent and internationallyconverged.
It will be recalled that
Professionalism is paying offin brokering business — OsijoP
RESIDENT, NigerianCouncil of RegisteredInsurance Brokers,
(NCRIB), Mrs Laide Osijo,has said that professionalismis paying off in brokeringbusiness as seen in theincrease in patronage ofbrokers by government andorganisations in recenttime.The NCRIB boss whodisclosed this in an interviewsaid the effort made by heradministration to see thatorganisations patronisegenuine brokers is yieldingresults as the number ofbrokers used by Governmentand organisations haveincreased.
She said that brokers are nowconscious of the fact that alleyes are on them and thatthere is a new dawn at theNCRIB. Osijo noted that heradministration has embarkedon a campaign on the need to
use brokers across all the areachapters, adding that she hasbeen taken members of thestate chapters to the stategovernment, canvassingpatronage. She said, “Today,they are patronising brokersat our meetings with theofficials of the states’governments, we do tell themthat if any of the brokers err,they should report to thecouncil, so far, none of thestates has reported any brokerto us. Brokers are nowconscious of the fact that alleyes are on them and thatthere is a new dawn at theNCRIB. Professionalism andethical behaviour is what wepractice now. And I am veryproud of all the brokers, fordoing things right,”
She noted that at a meetingwith executives of NigerianNational PetroleumCorporation (NNPC), thecouncil appealed for increasein the use of brokers and thatthe effort led to the increaseof the numbers of brokers bythe corporation from 14brokers last year to 42 thisyear. “In a meeting withNNPC I told them that wehave almost 500 members,and every one of us isstudying oil and gas, we areall attending courses toimprove our knowledge on oiland gas, and that manybrokers are attendingconferences because theywant to improve theirknowledge. I am very happyabout the increase which
moved from 14 last year to 42this year “she said
Osijo said, “last year at theHead of Service office, weappeal to them that thenumber of brokers used bygovernment should beincreased; they increased thenumber from about 60 to over200, the same with LagosState, we appealed to themthat they should make use ofour members and theyincreased the number ofbrokers. Today they aremaking use of registeredinsurance brokers, which ismy joy”. “I have told mypeople that once we practiceethically, professionally andgive qualitative services;definitely they would makeuse of us.” she said.
financial regulatoryauthorities had informedcompanies operating in theeconomy that IFRS will be thenew basis of financialreporting with effect fromJanuary 2012. The adoption ofIFRS will result in highquality, transparent andcomparable financialstatements based oninternationally acceptedmodern accounting principlesand concepts.
Accounts of PFAs now IFRS compliant — PenOp
BY RITA
OBODOECHINA
BY RITA
OBODOECHINA
SA Life beginsinsuranceawareness
MARSH survey says54% of firms have had
a cyber attack, most Europeanbusinesses’ cyber riskprevention tactics lag behindthe threat of an attack. Of therespondents to Marsh’s 2013cyber risk survey, 71% saidtheir worries about cyber riskhad increased over the past 12months, while 54% said theirorganisation had experienceda cyber attack. But 22% of thosesurveyed said theirorganisation had not carriedout any kind of cyber riskfinancial assessment, and 23%said that managing cyber riskwas not enough of a priorityfor their company.
Marsh EMEA cyber risk leadconsultant, Stephen Waressaid, “The spectra of a cyberattack evidently looms largeamong the risks that riskmanagers believe couldthreaten the continued successof their organisations. Despitethis, it would seem that in themajority of firms, cyber risk isstill largely misunderstood andmany struggle to implement aclear strategy to tackle iteffectively.”
Firms not facingup to cyberinsurance threat—Marsh research
*From right; Mr. Kamil Olufowobi, Director, Acceptance Development, Mastercard receiving Platinum Award; Mr MusaJimoh, Deputy Director, Central Bank of Nigeria and Miss Ann Agbokhan, Group Head, Marketing, Intermarc Consulting atthe 13th Card ATM & Mobile Expo E-Business Dinner and awards hled in Lagos. Photo by Lamidi Bamidele
Vanguard, MONDAY, JUNE 17, 2013 — 37
Homes & Housing Finance
By YINKA KOLAWOLE
BRIEFS
UK houseprices rise torecord high
House prices in the UKrose to a new record in
May as government measureshave increased mortgageavailability, according to aprivate survey.
The Royal Institution ofChartered Surveyors (RICS)reported that the UK houseprices rose in May to theirhighest levels in more thanthree years, with the numberof transactions surging on theback of improved economicprospects. The RICS monthlyhouse price balance rose to 5in May from 1 in April,compared to analysts’expectation of a reading of 4.
Acadametrics and LSLProperty Services said theaverage house prices inEngland and Wales rose 0.4percent from April to £233,061($365,000/• 274,000). On ayear-on-year basis, pricesincreased by 2.7 percent.Seven of the 10 regionssurveyed by Acadametricsshowed annual increase inhouse prices over the lastthree months. While Londonled the regions with a 10.1percent pickup, prices inWales declined the most at 1.3percent.
US mortgagerates rise asapplicationssurge
Mortgage applicationsincreased 5 percent
compared to the previousweek. However, mortgagerates have also continued toincrease, with all ratesincreasing this weekcompared to the previousweek except for 1-yearmortgage rates, which haveremained stable.
30-year fixed-ratemortgages increased from3.91 percent previous week to3.98 percent last week. Thisis the highest rate we’ve seenin 30-year mortgages sinceApril 2012.
According to Freddie Mac,15-year fixed-rate mortgagesalso increased to 3.1 percentlast week, compared to 3.03percent previous week, whichis the highest 15-year ratethis year.
5-year adjustable-ratemortgages also increased to2.79 percent compared to 2.74percent in the previous week,also the highest this year. 1-year adjustable-ratemortgages are the only onesthat have remainedunchanged, at 2.58 percent.
How informal sector operatorscan access NHF scheme
The Federal MortgageBank of Nigeria(FMBN) recently
introduced the InformalSector Cooperative HousingScheme, in a bid to integrateNigerians operating in theinformal sector of the economyinto the National HousingFund (NHF) scheme. Thisfollowed the formal launchingof the initiative in Lagos bythe Minister for Housing andUrban Development, Ms.Ama Pepple, in December2011.
The loan facility under thescheme could be accessed inone of two ways, namely:Cooperative HousingDevelopment Loan (CHDL)or Co-operative NationalHousing Fund Loan (CNL).
The Cooperative HousingDevelopment Loan (CHDL)enables a cooperative societythat has acquired a plot ofland to develop houses forallocation to its members. Theparcel of land will have titlein the name of the societywhich will act as the facilitatoron behalf of its members inthe loan transaction andwhich would facilitateconstruction of the housingunit. The root of title of theestate land would besubleased to thebeneficiaries.
To qualify for the CHDL:The Co-operative Societymust be registered with theRegistrar of Cooperatives incharge of the area withinwhich it is domiciled; Must beregistered with the NationalHousing Fund (NHF)Scheme; Must be responsible
for remitting the contributionsof its members; Must beaccredited by FederalMortgage Bank of Nigeria(FMBN) and; Must have beenin existence for a minimumperiod of twelve month duringwhich membership deals paidby members have beenconsistent.
In addition, the proposedestate must have good titlethat can be sub-leased toindividual allotters/purchasers of the housing unitthere in; The tenure of the loanshall be 24months withmoratorium period of12months; the loan shall bedisbursed to a cooperativesociety at an interest rate of 10percent; the Cooperative shall
identify a primary mortgagebank (PMB) with which itshall collaborate for thepurpose of processing aCooperative NHF Loan(CNL) for its members; thehousing units for theproposed project(s) must fallwithin a target selling pricenot exceeding N15millionand; the land upon which theestate is to be built shall havelegal title.
The security for disbursingeach tranche of the loan shallbe the title document of theestate land, and shall bedisbursed in three tranches tocomplete the substructure,super-structure, andfinishing, while FMBN shallfinance 100 percent of
housing development and 90percent infrastructuralfacilities.
The co-operative society isto develop the housing estatein any of the following ways:Engage registered buildingprofessionals with a view tomanaging the projects andcompleting the housing unitsto standard; Useprofessionals from within itsranks, on submission of proofof technical expertise ofmembers by the society;Engage an EstateDevelopment company,provided the company is ableto deliver the houses at aprice affordable to thecooperators and; all housingunits in the estate must besold to the co-operativesociety members who arecontributors to NHF Scheme.
On the other hand, the Co-operative National HousingFund Loan (CNL) offersindividual co-operativemember mortgage loan to buya housing unit developedthrough the Cooperativehousing Development Loanor renovate an existing one.Under this method, anindividual cooperator shallenjoy the housing loan at 6percent interest rate perannum; Cooperators shallmake a down payment of 15percent of the approvedselling price/value ofimprovement as theirpersonal stake in the loan;Evidence of minimum NHFmonthly contributions ofN450.00 for a minimumperiod of six months will berequired at the applicationstage and; any monthlycontribution in excess ofN450.00 shall be accountedfor in favour as part of his/herpersonal stake contribution atthe time of loan application.The tenure of the loan shallbe 25years.
Foreclosure crisis keeps millions inhousing limbo
Five years after themortgage meltdown
sparked a wave of homeforeclosures, millions ofAmericans are still in housing“limbo,” battling to save theirhomes despite governmentprograms meant to help them.
In January, the governmentabruptly canceled the review,agreeing to settle a two-year-old enforcement action with 14lenders over widespreadmortgage processingviolations. In return, thelenders agreed to make $3.6billion in payments toborrowers who were harmed,averaging about $1,000 each.Many of the more than fourmillion homeowners originallytargeted by the review are still
living “in limbo” and nocloser to an affordablemortgage.
More than two years afterregulators confirmedwidespread reports of abusivemortgage practices, thegovernment is making onlyhalting progress in fixing theproblem, according tohomeowners, their attorneys,housing counselors andpublic officials. It’s not only adilemma for the peoplecaught in the foreclosurenoose; it’s also holding backa broader housing recoveryand slowing the nation’seconomic recovery. The scopeof the systemic failure hasbeen widely known for muchlonger, following widespread
reports of lax procedures;flawed, inaccurate or missingdocumentation; and poorcommunication withborrowers.
In April, 2011, the nation’stop bank regulator, the Officeof the Comptroller of theCurrency, issued a sweepingenforcement action to address“failures and deficiencies”and ordered 14 lenders to fixthem “swiftly andcomprehensively.” A yearlater, targeting many of thesame practices, theDepartment of Justice and 49state attorneys general signeda detailed agreement with fiveof the nation’s largestmortgage lenders to adhere tocomprehensive new
Prefabricated buildings suitable for housing
Economy
can engage the politicians.If we have to havedevelopment, let us havesustainable greenerdevelopment.”
Explaining the rationalebehind the FW, Griese
said; "Future Workshop isabout bringing togetherpeople f rom di f ferentareas, ages, professionsetc. The basic idea is thatno one is moreexperienced than theother. The unique thingabout FW is that i t istechnology- free (nolaptops, tablets, phones,iPads etc). We need you,
your exper iences,knowledge; we need yourbrain fully,” he said.
The workshop involvedthree phases viz: Problem,Vision and Realisationphases.
At the problem phase,participants identified the
major resources in Nigeriawhich include Agriculture/Land, Biodiversity, Water,Air, Forests/Forestry andNon-renewable resourcesand then came up with 230problems related to theseresources. This, Griesenoted, was the highestamong all the FWs he hadconducted. He also notedthat this was the first time
air was selected in a FW asa resource.
The issue of land/landlaws, population growth,clashes between herdsmenand farmers, c l imatechange and its consequencesetc, featured strongly.
At the Vision phase,participants came up withtheir short and long-termvisions for Nigeria and howto actualise them.
They looked at somepossible limitations andconflicts of interest that couldarise and possible ways ofovercoming them.
For example, “If we decideto go the way of solar energy,that means solar panels willbe manufactured and the rawmaterial needed to be minedwith the consequences ofmining on the environment,”said Griese.
Participants stressed on
the need for peopleto connect and speak upand this will happen onlyif they are given the righteducation so as to keepabreast of issues ofresource governance. Theytalked extensively about oilpollution, gas flaring andthe need for action, notingthat “in al l we do, weshould think about thefuture of the forests, thecarbon sink, food securityand concrete policies thatwill deliver benefits to thepeople.”
At the end of the fourdays, participants were ableto come up with theirvisions for Nigeria whichinclude; a Nigeria whereresources are bettermanaged for the benefit ofall, where the environmentis not sacrificed on the altarof development, wheregreener/renewable energyis the order of the day,saying that all these will bepossible with the enablinglaws especially the land useact/land ownership.
They also called for thespeedy passage of thePetroleum Industry Bill andestablishment of ranches forherdsmen to deal withincessant clashes betweenfarmers and herdsmen.They said the subsidy ofconsumption should beconverted to subsidy ofp r o d u c t i o n w h e r e b ygovernment encouragesfarmers to farm and notw o r r y a b o u t s e l l i n gbecause government willb u y w h a t e v e r t h e yproduce.
The ideas from the Fu-ture Workshops will betaken into considerationat the Resource Summitwhich comes up in Sep-tember 2013 and will fea-ture about 200 part ic i -pants drawn from differ-ent continents.
sector." She maintained that"there is no need for progressif it is not democratic, fair andincludes everybody.”
She said HBS is currently
looking at how “ wecan move Nigeria forwardthrough the Green DealNigeria initiative. There areso many resources but youstill don’t have the kind ofgovernance that can makeuse of these resources for thebenefit of the people. We aregoing round the countryengaging the people at thegrassroots, politicians,universities, market womenetc so that they can haveconcrete practical demands.
"We will like to see peoplego to their local governmentauthorities and say; ‘Excuseme; we need an energy mapfor this local governmentbecause we don’t haveelectricity. We now know thatwe have renewable energy –solar, wind, small hydro,biogas etc and we can haveelectricity in our communitywithin a year if only we putour mind to it. So HBS istrying to connect the citizenswith the knowledge so they
THE need for people to be involved in making decisionson how they are governed, especially in the area ofresources, was the main point of a four-day workshop
tagged Future Workshop (FW) organised by Heinrich BoellStiftung (HBS), a German Green foundation in Abuja. Theworkshop brought together 12 young Nigerians fromdifferent walks of life to brainstorm on resource governanceissues, proffer solutions and come up with what theywould want Nigeria to look like in future.
This came at the right time as it is believed that therehas been so much corruption in the land because peopledo not hold their leaders accountable and until they aresensitized enough to be able to place a demand on electedofficials, they will continue to be shortchanged.
With so many natural resources in Nigeria, majority ofthe people have no business living in poverty if theresources are distributed equitably. The workshop whichexplored creative and innovative ways to manageNigeria's natural resources, was facilitated by Mr. RalphGriese, Managing Director of Germany-based Forumfor International Development and Planning.
According to Griese, HBS had conducted nine
Future Workshops in different continentswith participants from about 40 nations; Nigeriabeing the 10th and the last.
In her opening remarks, the Director, Nigeria& West Afr ica Off ice of Heinrich Boel lFoundation, Christine K, noted that HBS is agreen political foundation set up as a responseto the traditional politics of socialism,liberalism and conservatism. “Our main tenetsare ecology and sustainability, democracyand human rights, self-determination andjustice. We promote non-violence andproactive peace policies, with 30 officesaround the world, including Kenya, SouthAfrica and Nigeria.”
She said HBS seeks to create morediscussions between ci t izens andpoliticians and hence, their slogan; “Youneed to meddle as a citizen; it is only ifyou meddle that you can stay relevant. Ifyou don’t shout, no one will hear you,” shesaid, adding; “if we are discussing resources,there is a lot to shout about in Nigeria. Thereare lots of resources but a lot of unfairness,non-transparency and undemocratic practices in the resource Christine K …We are trying to connect citizens with the
knowledge so they can engage the politicians.
Resource managementmust be democratic andinclusive— Christine K
By EBELE ORAKPO,
,
38 — Vanguard, MONDAY, JUNE 17, 2013
We will like to see people go totheir local governmentauthorities and say; ‘Excuse me;we need an energy map for thislocal government because wedon’t have electricity
Airlines which breach these rulescan have their operation licenceswithdrawn. If the breach isminor, fine can be imposed onthe airline or the personsinvolved.
Also at the seminar, an officialof National Drug LawEnforcement Agency, NDLEA,Mr Nasril Kotangora, warnedthe agents to be wary of thoseshippers who insist on quickpassage of their luggage withoutproper screening as they mighthave prohibited items on them.He further warned the agentsthat the agency will arrestwhoever is found withprohibited items not necessarilythe owner of the item. And so,they should not sacrificethemselves for unscrupulousbusinessmen.
said agents should be able toknow and identify dangerousgoods. Eboigbe further saidthere are hidden dangerousgoods that the agents must beable to identify. These includebreathing apparatus for sickpersons, lighters, perfumes,body sprays, magnets, etc.Items like magnets aredangerous to flight operationas they distort signals fromcontrol towers.
Eboigbe disclosed that thereare sanctions for violators of theextant safety regulations.
can lead to tragedy. As a shipper,you have the right to know whatthe shipper is shipping . You mustknow what is inside the item.“
He, however, said inflammablegoods are transported by air butspecial care is taken in packingand loading of the goods onboard the plane.
Speaking also at the seminar,Mr Austine Eboigbe, a SafetyInspector with Nigeria CivilAviation Authority, NCAA, saidairlines are mandated to givetheir cargo handling agentstraining on cargo handling. He
AVIATION cargo
handling agents havebeen told to insist on 100 percent examination of cargoesthey handle for their clients inorder to avoid being tricked intoshipping dangerous goods thatcould lead to explosion onboard a flight.
This advice was given by MrAghogban Bright, GroupHead, Regional Biz/CargoShed Manager of GreaterWashington Logistics duringan enlightenment seminarorganised for cargo agents inconjunction with AeroContractor Airline at theairline's head office. He saidagents have been known toaccept goods which turn out tobe dangerous and inflammablegoods, that have led to aircrashes.
Bright further saidinflammable goods are amongitems prohibited from boardingas they could easily ignite fireon board a flight. Most Nigeriadomestic airlines do not acceptinflammable goods on board.However, cargo agents have tobeen aware of the implicationsof having such inflammablegoods on board. According tohim; “your action or inaction
Aviation cargo handling agentsurged to be vigilant
THE management of
Chanchangi Airlinesaid the 53 workers ofChanchangi Airline who havebeen on compulsory leavewere not sacked. The stationmanager of the airline, Mr.Babadiya Ahmed said theairline is already looking intothe matter.
The workers protested lastweek at the Nigerian Civil
Aviation Authority, NCAA's
headquarters, MurtalaMuhammed Airport, Lagosover unpaid salaries alleged tohave accrued since 2010 whenthe airline sent them oncompulsory leave. The workerswho decried the airline’s delayin paying their salariesregistered their grievances atthe ticket counters of thecompany at the airport beforeproceeding to the NCAAheadquarters to drive hometheir demands.
They alleged that they havenot been paid their salaries for36 months, a situation which
they said cannot be toleratedany more.The workers furthersaid they were asked to stay offwork since 2010, when theairline started havingoperational challenges, andhave not been paid since.
According to them, allattempts to draw the attentionof the management of theairline to their plight fell on deafears, even as the officialcommunication to the NCAA onthe matter has not yieldedpositive result.
Receiving the workers at
NCAA, the Director of HumanResources, Mr. Austin AmadiIfeanyi and the Director ofConsumer Protection, AlhajiAdamu Abdulahi assured themthat the regulatory agencywould look into their plight andprovide possible solutions byensuring that the airline doeswhat is right.
The directors furthercommended the aggrievedworkers for towing the path ofpeace by reporting the matterat the appropriate quarter as itis the duty of NCAA to ensure
that all goes well in the aviationsector.
According to them, theregulatory authority willinvestigate their claims and callChanchangi Airline to order toensure that the grievances ofthe workers are addressed andtheir demands met.
They, however, gave a weektimeline for the aggrievedworkers to get back, assuringthem that the matter would becritically looked into for thehealth of the industry.
Meanwhile, the stationmanager of ChanchangiAirline, Mr Babadiya Ahmedsaid the airline is alreadylooking into the matter, buthowever affirmed that theworkers were not sacked.
undergoing remodeling.According to the spokesman
of the Aviation parastal,Yakubu Dati , ‘’ the remodelledterminal has a full complementof modern facilities whichinclude; offices, shops,conveyor belts, screeningmachines, check-in counters,restaurants and ultra modernVIP lounge. The ambience ofthe departure and arrivallounges have also been
THE Federal AirportsAuthority of Nigeria
,FAAN, has revealed that theremodeled Sultan SaddikAbubakar III InternationalAirport, Sokoto will soon beready for commissioning as thecontractor handling the projecthas commenced puttingfinishing touches to theongoing remodeling work at theairport . The 30-year-oldairport, is one of the 22 airports
improved considerably toprovide sufficient comfort for allpassengers and crew."
He further said; "SultanAbubakar III InternationalAirport, which serves as a majorlink between the NorthWestern part of the countryand the rest of the world, willexperience new businessopportunities with the newcommercial offerings that theremodeled terminal will now
offer airport users there. Theairport offers flightconnections to Lagos, Abujaand Kano, thereby serving asa major catalyst forinvestment in the North Westzone of the country.’’
It is expected that theremodeled Sultan AbubakarIII International Airport willbe commissioned before theend of the fourth quarter of theyear.
Protesting Chanchangi workers werenot sacked — Management
Aviation
Sokoto Airport ready for commissioning soon —FAAN
By LAWANI MIKAIRU
A human rights group,
Youth and ConflictResolution Initiatives, YCRI,has commended the NigerianAirspace Management Agency,NAMA, for its challengingdrive to instil discipline in theaviation sector.
The group in a statementsigned by the Director,International Relations,Comrade Efemena Agadamadecried disrespect of theNigerian aviation laws bypowerful Nigerians andforeigners and urgedNigerians to support NAMA inbringing sanity to the sector.
“This is not the time to playpolitics with everything, if wewant NAMA to work, we haveto support them. The frequencyof air disasters in Nigeriashould be confronted andcorrected. It should no longerbe business as usual if thecountry must move forwardfrom the errors of previousyears.
“The Nigerian airspace withover 50 recorded disasterssince 1969 remains one of themost dangerous in the worlddue to the long years of grossdisrespect of aviation laws byboth Nigerians and foreigners.These gross breaches have tobe confronted and corrected atleast in 2013.
“In the West and otherdeveloped countries, pilots donot breach aviation laws, whythen should these erring pilotsin Nigeria try to drag politicsinto their illegal acts? Is itbecause the country is yet toimplement a strict rule of lawin all its activities?
“The aviation sector needsdiscipline and whoever mustpursue that demanding taskwill surely step on toes and thisis what NAMA seems to facefrom the Amaechi andOshiomhole cases. NAMAneeds support to sanitise theaviation sector. Anyone whofeels aggrieved should go tocourt and stop disgracing thecountry."
Rights groupcommends NAMAover grounding ofAmaechi,Oshiomholeaircraft
By LAWANI MIKAIRU& DANIEL ETEGHE
*From left: Vice-President, Information Systems Audit Controll Association (ISACA), Lagoschapter, Mr. Tope Aladenusi; Founding President, ISACA Lagos, Mr. Chris Ekeigwe; Presi-dent, Mr. Peter Ineh and Iformation Branding Director, Mr. Uzo Odunukwe, during a courtesyvisit of the executive members to the founding president, in Lagos on Thursday.
BRIEF
Vanguard, MONDAY, JUNE 17, 2013 — 39
FOR Bank of Industry to give out loans to small and
medium sized enterprises,prospective borrowers need to presentand convince the bank on the viabilityof their proposals with assurance topay back their loans as at when duedespite the bank’s insistence on 10 percent of the total amount to be loanedfrom the bank especially fromcooperative society as commitment fee.
In as much as BOI’s ManagingDirector, Ms Evelyn Oputu regrettedthe challenges majority of the SMEsface in their quest to secure loans fortheir businesses, she observed thatmany entrepreneurs approach thebank not equipped with the necessaryinformation required of them to secureloans whilst some others do not evenknow about the mandate andobjectives of the BoI.
Ms Oputu at a three-day workshoporganised for Business editors andIndustry Correspondents in Lagosrecently themed: Enhancing the roleof the media in the transformation ofNigerian industrial sector, enjoinedoperators of SMEs to always find outproperly about the procedures andprocesses of securing loans in orderto help package bankable proposalsbefore seeking funding support fromdevelopment finance institutions asthe BoI.
She assured that the bank willcontinue to support the SMEs sector,
Economy
which she described as the engineroom of growth of any economybecause of the potentials of the realsector to generate mass employment.
The Bank of Industry (BOI) hasapproved more than N16 billion loansto various cooperative groups acrossthe country in a renewed bid tostimulate the development and growthof Small and Medium Enterprises(SMEs) towards contributing to theexpansion of the nation’s GrossDomestic Product (GDP). In addition,BOI has trained almost 10,000 smalland medium entrepreneurs inentrepreneurial skills on how toestablish and run bankable smallbusinesses within the last three years.
Small and Medium Enterprises(SMEs) in Nigeria, as defined bySmall and Medium Industries EquityInvestment Scheme (SMIEIS), areenterprises with a total capitalemployed not less than N1.5 million,but not exceeding N200 million,including working capital, butexcluding cost of land and/or with a
staff strength of not less than 10 andnot more than 300.
BoI, Oputu said, requests forcollateral as an additionalrequirement, apart from requiringpersonal guarantees for SME loans,because the financial and operationaltransparencies of SMEs are relativelylow and their accounting standardspoor.
“The enterprises are also perceivedas risky due to the fact that, in mostcases, the death of the owner leads tothe death of the business, diversionof funds, high cost of monitoring loansand the fact that most of the loans maynot be collateralised”.
She gave a breakdown of the fundsbeing managed by the bank as “CBNN235 billion re-financing fund; N100billion Cotton, Textile and GarmentFund; N10 billion Rice Sector Fund;and N16.91 billion NationalAutomotive Council Fund. Others are$4 million UNIDO renewable Energyprogramme fund; $ 500 million AfDBfund; N500 billion Power/Aviation
Fund; N5 billion Dangote Fund, N9.5billion cement fund as well as N90million Women Affairs Fund.
According to her; “You do not
need insider connection toaccess BOI managed funds, rather, theentrepreneur should have a well-packaged bankable proposal beforeseeking funding support from thebank.
“The bank insists on collateral for bigloans because the money is not mine,it belongs to Nigerians and if youdon’t pay back the loan, I’ll sell yourhouse and recover the loan,” shewarned.
Regarding loan disbursements andrecovery, Ms. Oputu said the bank hadwitnessed unprecedented expansionin its credit operations withoutcompromising the quality of itsinvestments and posted impressivefinancial results.
“The cumulative value of fresh loansand investments rose by 1.91 per centfrom N9.8 billion to N202.3 billionbetween 2005 and mid-2012.
Risk asset also grew by 691 per centto N105.27 billion by September lastyear from N13.3 billion in 2008.
Also, the portfolio of risks assetsdeclined from 65 per cent in 2005 to15 per cent in 2012,” she said.
Testifying to the goodwill of thedevelopment bank at the workshopwere the Chairman/ManagingDirector, Kam Industries (Nigeria)Limited, Alhaji Kamoru Yusuf; Hon.
...Insists on 10% commitment fee
BY FAVOURNNABUGWU
BoI allowszero collateral
to micro,cooperative
borrowers
,
,The bank insists on collateral for
big loans because the money is notmine, it belongs to Nigerians and ifyou don’t pay back the loan, I’ll sellyour house and recover the loan
40 — Vanguard, MONDAY, JUNE 17, 2013
Continues on page 41
Economy
Salisu Buhari (former Speaker ofHouse of Representatives and now abusinessman; Mr Felix Egbamuno,Chairman, Femro 3 Nigeria Limited;Hamza Sule, Commissioner for Trade& Industry in Gombe State; OtunbaBimbola Ashiru, Commissioner forCommerce and Industry, Ogun Stateamong others.
Not left out in the drive to help smalland medium scale businesses, some18 states have partnered with BoIthrough counterpart funding to grantloans to small businessmen andwomen in their states. The statesinclude: Anambra, Delta, Kwara,Niger, Kogi, Osun, Edo, Ondo, Ekiti,Ogun, Oyo, Gombe, Benue, Akwa-Ibom and Cross River states, at 5%interest rate for the development of theMSME sector in each of theparticipating states mainly throughthe bank's cooperative lendingscheme.
Giving insight into the
partnership between BoI andGombe State Government, HamzaSule, the state Commissioner for Tradeand Industry said BOI disbursed N3billion to Small and Medium-scaleEnterprises (SMEs) under the secondphase of trade intervention aimed atproviding more funds forentrepreneurs in the state.
He said that Governor IbrahimHassan Dankwambo had directed thatthe fund is to be disbursed as soft andaffordable loans to SMEs in the state,to invest in value addition activitiesin the agro-allied and mineral sectorsof the state's economy.
He recalled that the stategovernment had two years ago signeda Memorandum of Understanding(MoU) with BOI in order to repositionthe economic fortunes of the state.This, according to him, led to thecreation of a “Matching Fund” of N1billion through a joint contribution ofN500 million each by the stategovernment and BOI to SMEsengaged in value addition activitiesin fertilizer blending, groundnut oilprocessing rice processing, poultryfeeds processing, fish feedsprocessing and tomato processing.
The governor said the scheme hasgenerated hundreds of jobs throughcooperative societies and the SMEs,adding that 1,380 jobs have beencreated by 39 cooperative societieswhile it is envisaged that by the timeall the 133 cooperative societies arevisited, more than 3,000 new jobswould have been created.
Beneficiaries of the Bank of Industry(BoI) and Dangote Group's N5 billionrevolving loan for Small and Medium-scale Enterprises have expresseddelight at the initiative, whichaccording to them, has grown inoutput and created more jobs.
Also BoI and Dangote Group’s N5billion revolving loan for SMEs hasboosted beneficiaries' businesses andcreated more jobs. The DangoteFoundation and BoI, in March lastyear, signed a Memorandum ofUnderstanding to set up a micro, smalland medium enterprises (MSMEs),with N5 billion initial fund to createabout one million direct jobs.
President of the cooperative, Mr.
Abimbola Olanrewaju, and chiefexecutive of Ojak Technologies, asecurity installations and cyber cafeoperator, are now itching to join the10-member group. The groupcomprises members who are intophotography, boutiques, cyber cafesand bridals. Olanrewaju said theloan of five per cent interest rate,has grown the business of OjakTechnologies raising sales by about30 per cent since October last yearwhen the facility was obtained,besides increasing staff strengthfrom two to five.
“The loan has made me very busy,”he said, lamenting the negativeimpact of poor power supply on thebusiness.
For Mrs. Bukola Opara, her BuchiKreations has expanded with the useof the Dangote/BoI facility, buyingmore varieties for her outfit.
Ms. Tracy Uzoma of Tracy Bridalsand Makeovers had told WeeklyTrust that the loan “really helpedto grow my bridals business, becausewe were formerly into makeovers
only.”
On repayment of the loan,Olanrewaju explained that:
“Everyone pays into an account fromwhich we issue a single cheque to BoIto cover interest and principal on amonthly basis since last year.”
Mrs. Opara said the group “hopesto repay the loan on schedule to beable to apply for another one. Verymany people want to join ourcooperative now, because theymissed the opportunity to join atinception, since they never believedat the time that the loan scheme isfeasible.”
Stallion Multipurpose CooperativeSociety, after repaying the currentloan, Mrs Opara noted, hope toreceive as much as five times of theamount they got under the currentarrangement, helped by the fact thatthey now have a good credit history.
The Bank of Industry and the OndoState Government have so fardisbursed about N602m as loans tosmall and medium entrepreneurs for
their N2bn joint scheme.In his presentation, General
Manager, BOI, Mr. MohammedAbdul-Ganiyu, informed thegathering that the bank which hasmanaged series of intervention fundsaimed at repositioning the industrialsector, has so far saved about 8,070jobs in the textile sector.
According to him, this has led to theturnaround of 38 textile firms fromimminent collapse. He advised thatentrepreneurs who are into similarline of production could formthemselves into a kind of cooperativegroup to access funding from the bank,saying it is easier for them to havecheap access to infrastructure throughthe industrial cluster initiative.
Abdul-Ganiyu said as a way of
increasing funding to theSME sector, the bank in 2006 throughits paradigm shift initiative, dedicated85 per cent of its resources to thefunding of the BOI tasked SMEs onbankable proposals. Mr. JosephBabatunde, BoI’s General Manager(Operations) in a paper he presentedat the worshop titled Overview of BankOf Industry Limited’s Activities andOperations, said the core mandate ofBank of Industry is to providefinancial assistance for theestablishment of large, medium andsmall projects; as well as expansion,diversification and modernisation ofexisting enterprises; andrehabilitation of ailing industries.
Babatunde noted that the bankplaces emphasis on prudent projectselection and management, as suchresources are directed to supportcommercially viable and economicallydesirable projects with highdevelopmental impact such as valueaddition to local raw materials, jobcreation and poverty alleviation toenhance the social economic well-being of Nigerians.
On his part, Mr. Lawal Gada,Renewable Energy Manager/Ag.Project Manager, BOI/UNDP AtREProject acknowledged that SMEs areconfronted with several challengeswhich hamper their growth andconsequently, the nation’s economicdevelopment.
The major challenges that need
to be addressed immediatelyhave been identified as, but notlimited to: high cost of doing businessoccasioned by poor infrastructure(power, roads, water, etc), multipletaxation, high cost of legaldocumentation of credit facilities atboth the states' Lands Registries andthe Corporate Affairs Commission(CAC); Bureaucracy in obtainingtitle to land and State Governors’consent to mortgage property;inadequate capacity-building on thepart of the SMEs in the areas ofentrepreneurship, skills acquisition,etc and on the part of the financialinstitutions in understanding thedynamics of the SME sectorresulting in their perception of thesector as high risk; poor attitude toloan repayment by the borrowersand limited access to creditoccasioned by the above factorsamong other reasons.
,
,
•Managing Director, BOI, Ms Evelyn Oputu
The Bank of Industry and theOndo State Government have sofar disbursed about N602m asloans to small and mediumentrepreneurs for their N2bn jointscheme
Vanguard, MONDAY, JUNE 17, 2013 — 41
Continued from page 40
Appointments & Promotions [email protected] 08033348923
42 — Vanguard, MONDAY, JUNE 17, 2013
UNIFIED PaymentS e r v i c e s ,UPS, Limited has
appointed two directors. Theyare Babatunde Okeniyi,Director, Marketing and Salesand Sina Joseph, Director ofInformation Technology andOperations.
A statement by the company,said Okeniyi would bring to hisnew position, institutionalknowledge of UnifiedPayments, wealth of experienceof about two decades andvaluable industry contacts.
Until his new appointment,he was Director, IT/Operationsin Unified Payments.
Hitherto, he was GroupHead, Operations.
Prior to joining UnifiedPayments, Okeniyi worked indifferent institutions includingCitibank Nigeria and UBA Plcwhere he was GeneralManager and Group ChiefInformation Officer (CIO).
He is a fellow, InternationalAcademy of Cards & Payments,alumnus of Lagos BusinessSchool where he completed hisAdvance ManagementProgramme (AMP), Obafemi
Awolowo University (B.Sc.) andUniversity of Lagos (MBA).
On his part, Joseph brings toUnified Payments, a wealth ofexperience spanning over 2decades.
After a fulfilling career in CitiBank Nigeria, Joseph joinedAccess Bank where he workedand rose to the position of ChiefInformation Officer.
2013, before returning toNigeria to join the services ofUnified Payments effectiveJune, 2013.
In addition to being analumnus of Harvard BusinessSchool, he is an alumnus ofUniversity of Benin where heobtained a First Class Degree(B. Sc. Hons.) in IndustrialMathematics.
He is an industry player andvaluable asset and has beeninvolved in different industryprojects including (i) Member,CBN Technical Committee forimplementation of RTGS (ii)NIBSS’ Board TechnicalCommittee for selection ofNational Central Switch; and(iii) Chairman, NIBSS’Committee for setting the Rulesand Standards for the NationalCentral Switch.
BRIEF
•Joseph
Merit award
committee
solicits for
more funds
NATIONAL Productivity
Order of Merit AwardCommittee, NPOMAC, hascalled for more allocation offunds from the FederalGovernment to enable theCommittee to carry out itsassignments of combining thenooks and crannies of thecountry to get the mostqualified awardees forNPOMA Award.
Chairman of the committee,Dr. Abbas Aidi, made the callin Abuja during a visit to thePermanent Secretary FederalMinistry of Labour andProductivity, Dr. Clement Illoh.
Dr. Abbas Aidi, pleaded withthe Minister of Labour andProductivity, Chief EmekaWogu and the PermanentSecretary, to, on behalf of thecommittee, solicit for adequatefund from the presidency tocarry the commout theirnational assignments.
According to him, “Ourassignment is based on meritit is not just a question of sittingdown in a place to pick fiveorganisations out of thenumerous organisations in thecountry for the award, alsogoing round the country to pickten individuals out of160million Nigerians forproductivity award is not a jokeand there is need to increasethe number of awardees toencourage them.”
He commended PresidentGoodluck Jonathan for theapproval of the first everNational Productivity Policywith the award ceremoniesslated for the month of Augustannually.
*From left: President, Nigerian-British Chamber of Commerce, Mr. Chukwuemeka Awagu, Hon.Minister of Labour a nd Productivity, Chief Emeka Wogu and Director, UK Trade Investment, MikePurves, during the Nigerian-British Chamber of Commerce meeting in Lagos
Unified Payment Services appointsOkeniyi, Joseph directors
He subsequently worked inKeystone Bank (formerly BankPHB) as General Manager andHead of InformationTechnology.
Upon disengagement fromKeystone Bank, Josephenrolled for his GeneralManagement Programme,GMP, at the Harvard BusinessSchool and completed in May,
graduation. In his address, theActing Provost, Prof. SundayOkeniyi, said only 387 cadetswere admitted into theAcademy out of the over 25,000 who applied.
“142 cadets were admittedinto the Engineering Faculty,118 into Sciences Faculty, while127 were admitted into Artsand Social Sciences Faculty,”the provost added. He warnedthem to be of good behaviour,saying, “this academy haszero tolerance for indiscipline”.
Also speaking, theCommandant of the NDA, Maj.-Gen ChuwuemekaOnwuamaegbu said theadmission of the cadets wasstrictly based on merit.
He said NDA’s conformitywith the commission’sacademic standard hadcontributed to the accreditationof all its courses.
The executive secretary urgedthe authorities of theinstitution to continue to takethe lead by coming up with innovations that would help Nigerians, saying “I am proudof the NDA; this is anenvironment for properlearning, i would advise otherNigerian Universities toemulate the Academy.’’
Okojie also advised the cadetsto focus on their studies,especially as they needed notto worry about the prospects ofsecuring employment after
NIGERIAN DefenceAcademy, NDA ,
Kaduna, has matriculated nofewer than 387 cadets.
This came as the NationalUniversities Commission,NUC, donated 50 computers tothe academy for complyingwith the commission’sacademic standards.
The NUC ExecutiveSecretary Prof. Julius Okojieannounced the donationduring the maidenmatriculation of the institutionin Kaduna.
387 cadets, including 14foreign students from theRepublic of Benin, CentralAfrican Republic and Togomatriculated.
AHEAD of next week 9th
Triennial Delegates’Conference of our LabourCentre, the Trade UnionCongress of Nigeria, TUC , toelect officers to lead thesecond labour centre in thecountry, 11 of the strongestaffiliates of TUC, have throwntheir weight behind thecandidature of the Presidentof Petroleum and Natural GasSenior Staff Association ofNigeria, PENGASSAN,Babatunde Ogun, to becomethe President-General of TUC.
Consequently, two of theleading aspirants, have stepdown for Ogun.
They are Sunday Salako,President of Association ofSenior Staff of Banks,Insurance and FinancialInstitutions, ASSBIFI andBabatunde Abdulrahman,President of Food, Beverageand Tobacco Senior StaffAssociation of Nigeria,FOBTOB.
Under the umbrella of theHarmony group, Salako isnow seeking to become firstDeputy President-General,while Abdulrahman iscontesting to become TUCTreasurer.
At a briefing to president the13 candidates under theHarmony Group, Ogun, saidif elected the priority of thegroup would be to “DeliverTUC Secretariat Structurewith Facilities & KPIsresponsive Personnel EquipTUC with the right skills,expertise and Technologicalresources. Make TUCproactive &responsive onnational/global issues ofconcerns and interest tolabour/affective public. MakeTUC consciously focussedwith data, research & analysisfor contending with national/global dynamics & reforms.
PENGASSANPresident getsendorsement forTUC President-General
•Babatunde Ogun
NDA matriculates 387 cadets,receives 50 computers from NUC
•Okeniyi
Global phonemanufacturer, Nokia
Nigeria, has announced thatusers of the Nokia Asha 311,310, 309 and 308 can nowsend and receive office e-mails from the comfort of theirmobile phones, giving themthe opportunity to connectwith work in and out of theoffice.
The announcement followsthe introduction of the Mailfor Exchange app in theNokia Store. The new app,which is compatible with theNokia Asha 311, 310, 309 and308, allows users to sync theiremail, calendar and contactsdata with Microsoft Exchange2003, 2007, 2010 Servers andMicrosoft Office 365 MobilityOnline Service.
Marketing Manager forNokia West Africa, KesienaOgbemi explained that theintroduction of the new appmakes the Nokia Asha 311,310, 309 & 308 ready forbusiness. “It will enable usersto take their office whereverthey go, enhancing their
Micro-Finance Commodity Index
NDIC seeks prompt rendition ofpremium from MfBs
STORIES BYPROVIDENCE OBUH
The Nigerian DepositI n s u r a n c eCorporation (NDIC)
has tasked operators ofmicrofinance banks in thecountry to improve onpremium rendition to it.
Managing Director of thecorporation, Alhaji UmaruIbrahim made the call duringthe MfB operators’ workshopin Abuja, the first in six seriesto hold in other statesincluding Lagos. Ibrahimpointed out that sinceinception, the corporation hascollected a paltry sum of N1.6billion from MfBs, saying,“Most of you would rather putyour money on Treasury Bills
and go to sleep because of risks associatedwith lending, but that is not the essence ofmicrofinance banking. The level of premiumcollected by NDIC which is N1.6 billion byway of premium since 2005 is a paltry sum,if one considers the insured deposit liabilityof microfinance banks.”
He said that the development is worrisometo regulatory authorities, stating that part ofthe reason for the stakeholders’ meeting wasto enable the forum address some of thedifficulties associated with the practice ofmicrofinance banking in Nigeria.
He advised MfB operators to approach thecorporation whenever the need arises forassistance, pointing out that reliable andhonest information about businesses areprerequisite.
Meanwhile, the Corporation put totalinsured deposit liability of MFBs at N4.5billion while close to N2.5 billion had beenpaid as insured deposit to depositors ofclosed MFBs.
NYF: Africa 2013 business summit
focuses on SMEs
With a special focus onSmall and Medium
Enterprises (SMEs) andentrepreneurs, the New YorkForum (NYF) AFRICA 2013has come together to discussissues on national andeconomic security,infrastructure and foreigndirect investment
The New York ForumAFRICA is the pan-Africanbusiness summit, whosemembers are Cameroon, the
Central AfricanRepublic, Chad,Equatorial Guinea,Gabon and the Republicof the Congo.
In a statement,Founder, NYF, Mr.Richard Attias said thatit will host economicleaders, businessexecutives, younge n t r e p r e n e u r s ,investment funds,policy makers, and
in te rnat iona lmedia fori n t e n s ediscussions andw o r k i n gsessions. “Theywill discuss howto acceleratee c o n o m i cd e v e l o p m e n tacross theA f r i c a nc o n t i n e n tt h r o u g hincreased tradetransparency,g o v e r n a n c e ,s a f e t y ,entrepreneurship,and support forSmall andM e d i u mE n t e r p r i s e s(SMEs), whichaccounts for 90per cent of theprivate sector onthe continent.
“Sustainable,l o n g - t e r mgrowth in Africawill not bepossible withouttwo things: thepartnership ofA f r i c a ng o v e r n m e n t sand themobilization ofAfrica’s youngworkforce. Wewill have a verystrong level ofattendees fromboth of thesecommunities atthis year’s NewYork ForumAFRICA,” Attiassaid.
Nokia extends mail for exchangeto its Asha smartphones
overall mobileexperience for work.”
To give users a fulloffice experience, Nokiahas also introducedfurther apps, Editori textand sheet, which allowusers to view and editMicrosoft Word andExcel documents on thego. This is expected toadd huge flexibility formobile phones to modify,save and sharedocuments orspreadsheets for quickreview right from yourNokia Asha phone.
The Editori text andsheet also comes withother great featuresincluding rich textformatting; bold, italic,colors and underline tokeep track of thechanges made. The apprecognizes hyperlinks,can enable users to viewpictures, tables and savethe document to memorycard immediately.
Jun 07-13 2013
Vanguard, MONDAY, JUNE 17, 2013 — 43
44 — Vanguard, MONDAY, JUNE 17, 2013
ICT
*From left: Mrs. Jane Anyaehie, Company Secretary, Mr. Felix Ohiwerei, Chairman, eTranzact International Plc and Mr.Valentine Obi, MD/CEO of eTranzact International Plc at the eTranzact AGM recently.
British Council donates 40 digital hubsto schools
Stories byPRINCE OSUAGWU
British Council, theUnited Kingdom’si n t e r n a t i o n a l
organisation for culturalrelations and educationalopportunities, in collaborationwith Microsoft Nigeria, a
global Information Technologyfirm, has demonstrated itssupport to e-learning inNigeria with the donation of40 digital hubs to two publicschools in Lagos.
The digital hubs, located atOjota Senior SecondarySchool, Ojota and OregunSenior High School, Oregun,Ikeja, were part of the
Corporate SocialResponsibility of BritishCouncil in Nigeria.
Each of the digital hubsconsists of complete computerfacilities such as a monitor,Central Processing Unit,Uninterruptible Power Supplyfacilities, a table, a chair withinternet connection. Twenty
digital hubs each wereprovided for the two schools.
Speaking at the jointcommissioning ceremony ofthe projects held at OregunSenior High School, CountryManager, British Council, Mr.David Higgs, said hisorgainsations decided topartner Microsoft, which
supplied the computerfacilities, because of thelatter ’s penchant to driveeducation, using modern ICTtools.
“We like the approach ofcollaboration between BritishCouncil and Microsoft.Future will be more ofcollaborations betweenorgainsations in buildinginstitutions for common goodsand to build education, ourcollaboration has become areality today,” he said.
He noted that in total, BritishCouncil had deployed 90digital bubs in six countriesacross the sub-Sahara Africa,stressing that as one of thelargest economies in Africa,Nigeria cannot afford to delayin infusing ICT in itseducational development.
”There is a very largepopulation of young people inNigeria and this means thereis a great potential. We needto give the youths ICT toolsto compete economically inthe 21st century. Today, life isincreasingly depending onICT to drive qualityeducation,” he said.
Higgs said with thecommissioning of thefacilities, which will later bemaintained by the Lagos StateGovernment through theministry of education,students would have theopportunity to accessacademic materials fromanywhere in the world as wellas collaborate with their peersin other countries.
He urged the students andteachers to take advantage ofthe hubs to explore thebenefits inherent in ICT.
Online shop, Buycommonthings rebrands to Gloo.ng
BuyCommonThings.com,one of Nigeria’s Online
supermarkets has rebrandedto Gloo.ng, unveiling aredesigned identity as well asa new website. The onlineshop debuted since October2012, when it wascommercially launched andsince then has been helpingpeople save time andvaluable money off theirregular shopping forgroceries and livingessentials.
With this rebranding,BuyCommonThings.com saidit was realigning the coremessage to the community-at-large not yet familiar withtheir services.
The online shop said that forthe six or seven months it hasbeen in existence, it hasenriched lives by virtue of thetime, stress, energy andmoney customers save fromthe rigorous chore of grocery
and living essentialsshopping. These savings cannow be applied on more life-fulfilling activities such asspending quality time withfamily and laying a solidfoundation for the success ofthe next generation ofNigerians among otherthings. CEO of the company,Mr Olumide Olusanya, saidthat “e-commerce is graduallybecoming the most effectiveform of direct marketing and
products and service deliveryin Nigeria andBuyCommonThings.com, nowGloo.ng, is tailored towardsthat.
No wonder in so short a timewe have become the preferreddestination when it comes toliving essentials shopping,”
Olusanya said that the newwww.gloo.ng website willhighlight the company’s corebenefit of simplifying hercustomers’ lives by further
simplifying its layout into anuncluttered canvass, makingit even easier and moreefficient for her customers toget with the business theycame to do on the site.
The redesigned logo andwebsite will showcase a freshlook for the service and utilizea responsive and easy-to-navigate design, he added.
He said that the reasonswhy Gloo.ng, onlineSupermarket, has become
known for dependable andlegendary service; includedefficiency in the shortestaverage order-to-doorsteptime in the entire industry;everyday low prices; 100%-free same day delivery; andwidest selection ofsupermarket goods online inNigeria. We don’t sellgroceries. We sell happiness.”
Outsourcing brings Task systems, Dhanush together
Frontline IT solutionsproviders, Task Systems
Limited, and DhanushInfoTech Ltd, have pulled theircompetencies together toprovide outsourcing servicesfor their customers.
Dhanush InfoTech, hasmore than 800 IT consultantsspecialised in a multitude oftechnology and business
domains and Task Systems,has over 1,000 Engineersdeployed on site forcustomers.
Both companies are comingtogether at a time whencorporate organisations arelooking for solutionscompanies that will take someservice loads off to enablethem concentrate on their core
competencies.The partners said that their
coming together would givetheir customers that one-stop-shop that provides answersthat would directly increaseproductivity and profit.
Expressing the prospectsthat brought about thepartnership, ManagingDirector, Task Systems, Mr.
Stanley Okpalaeke, arguedthat as global economicdownturn continues to putcompanies under pressure,only smart, flexible andinnovative solutions canensure defiant growth ,adding that the partnershipwas a good bonding of likeminds.
Vanguard, MONDAY, JUNE 17, 2013 — 45
International
Tanzania ’s FinanceMinistry said it plans to
raise as much as $700 millionthrough selling debt toselected investors andcommercial bank loans to helptackle unreliable electricitysupplies and poorinfrastructure. Even thoughthe interest rates will behigher than fromdevelopment institutions, theprivate funding will be morepredictable for the country,Deputy Finance MinisterSaada Salum said. “Whilenon-concessional loans havehigher interest rates andshorter grace periods thanconcessional loans, non-concessional loans have beena reliable tool for us inborrowing,” Salum said in an
IMF urges repeal of ‘ill-designed’ USfiscal cuts
The Chartered Instituteof Bankers of Nigeria,
CIBN has inaugurated itsLafia branch in NasarawaState.
President/Chairman ofCouncil of the Institute Mr.Segun Aina said that it wasthe policy of the Institute forState Branches to be situatedin the State Capitals for veryobvious reasons whileSatellite Branches can beestablished outside the StateCapitals.
But based onrepresentations from theinterested members of theInstitute and otherStakeholders in the state’sBanking Community, wherethe branch will operate fromNasarawa town for amaximum period of twoyears, till May 2015 when themain State Branch willoperate from Lafia, the StateCapital.
The Branch was officiallylaunched by the Presidenttogether with thecommissioning of the CIBNLearning Centre establishedat the Federal Polytechnic,Nasarawa.
The International MonetaryFund urged the United Stateson Friday to repeal sweepinggovernment spending cutsand recommended that theFederal Reserve continue abond-buying programthrough at least the end of theyear. In its annual check of thehealth of the U.S. economy,the IMF forecast economicgrowth would be a sluggish1.9 percent this year. The IMFestimates growth would be asmuch as 1.75 percentagepoints higher if not for a rushto cut the government’sbudget deficit.
The IMF cut its outlook foreconomic growth in 2014 to 2.7percent, below its 3 percentforecast published in April.The Fund said in April it stillassumed the deepgovernment spending cutswould be repealed, but it hadnow dropped thatassumption. Washingtonslashed the federal budget inMarch, adding to the drag onthe economy created by taxincreases enacted in January.The IMF said the UnitedStates should reverse thespending cuts and insteadadopt a plan to slow thegrowth in spending ongovernment-funded healthcare and pensions, known as“entitlements.” The Fundwould also like the UnitedStates to collect more in taxes.“The deficit reduction in 2013has been excessively rapidand ill-designed,” the IMFsaid. “These cuts should bereplaced with a back-loadedmix of entitlement savingsand new revenues.” The IMFwarned cuts to education,science and infrastructurespending could reducepotential growth.
While the Fund said totaldebt across all levels ofgovernment would likelydecline after 2015, publicfinances are nevertheless onan unsustainable path due toan aging population andhigher spending on healthcare. “Now our advice is notjust to slow down (budgetcuts),” IMF ManagingDirector Christine Lagardesaid at a news conference.“Our advice is also to hurryup: hurry up with putting inplace a medium-term roadmap to restore long-run fiscalsustainability.” She saideffects of higher spending onhealth care and otherprograms build up over time,so it was important to actquickly to address them.
The Fund recommendedthat the U.S. Federal Reserve
keep up its massive assetpurchases at least through theend of the year to support theU.S. recovery, but should alsoprepare for a pull-back in thefuture. The Fed is currentlybuying $85 billion per monthof Treasuries and mortgage-backed securities in an effortto lower borrowing costs andspur employment growth.Lagarde said the IMF hasassumed that the Fed wouldbegin trimming bondpurchases next year.Speculation over when theFed might start to pare backits bond buying has roiledfinancial markets recently.
Kenya Airways sees peace,
cheaper oil restoring profit (Reuters) - Peaceful
elections, lower oil prices andthe easing of tensions inneighbouring Somalia shouldhelp Kenya Airways recoverfrom a tough two years thatsaw it swing to a pretax lossin the year ended March, itsaid on Friday. The airline,which is 26.73 percent ownedby Air France KLM , reporteda pretax loss of 10.83 billionshillings ($126.8 million) forthe period. That followed a 57percent drop in pretax profitthe previous year.Management blamed thefestering euro zone debtcrisis, fears of unrest during
Kenya’s March presidentialelection, and a string of gunand grenade attacks onKenyan soil following its forayinto Somalia in pursuit of alShabaab militants.
“Somalia is finally settlingdown and we had a peacefulelection so on the combinationof those two things, we expectthe travel advisories that wesuffered last year will not beevident this year,” saidfinance director AlexMbugua, referring to someforeign countries that hadadvised their citizens againsttravelling to Kenya due tosecurity concerns.
BRIEFS
CIBN inauguratesNasarawa branch,commissionslearning centre
MTN stops SIMswap by proxy
By PRINCE OSUAGWU
MTN Nigeria, last weeksaid it has decided to
discontinue SIM swaps byproxy saying that customerswho wish to ‘swap’ or replacetheir SIM cards as a result oftheir phones being stolen,destroyed or mislaid must doso in person. The decision,according to MTN, was takenin order to protect customers’data and preserve the overallintegrity of the SIM swapprocess.
MTN Corporate ServicesExecutive, Mr. AkinwaleGoodluck, at a pressconference in Lagos,explained that in recentmonths, unscrupulouselements have started toexploit the proxy SIM swapprocess and that there havebeen incidents ofunauthorized peoplefraudulently obtaining SIMcards belonging to others.
“The implication of thisdecision is that customers willnow have to appear in personat the service outlets nearestto them to request and obtainnew SIM cards.
Tanzania will seek $700m in privateplacement, bank loans
interview yesterday in thecapital, Dodoma. “As Tanzaniaexpects continued economicgrowth, it is important that weinvest in infrastructure tomake sure that the countrycan sustain this growth.”
Tanzania, East Africa’ssecond-largest holder ofnatural gas reserves, plans tospend 5.7 trillion shillings($3.5 billion) on developmentprojects in 2013-14, includingmoving forward with plans tobuild a pipeline from thesouthern Mtwara region tothe commercial hub of Dar esSalaam. The country is alsogoing to spend money onstrengthening the electricitytransmission network andbringing power to ruralcommunities. Finance
Minister William Mgimwasaid in his annual budgetspeech yesterday that hisspending plan factors in 1.2trillion shillings in external,non-concessional borrowingfor the year through June2014. The governmentestimates the economicgrowth rate will be almostunchanged at 7 percent thisyear from 6.9 percent in 2012,and rise to 7.5 per cent nextyear and 8 per cent in 2015.
Tanzania had periodicpower outages earlier thisyear after drought cut waterlevels in hydroelectric dams,forcing the country to rely onemergency thermalgeneration to cover anelectricity deficit of as muchas 365 megawatts.
*Second from right- Alhaji Abubakar Kau Baraje, Chairman, Board of Directors, NigeriaRailway Corporation and other members of the board, inspecting the local workshop of thecorporation in Lagos.
Advertising, Media& Marketing
winning mindshare war haselevated television commercialsin present day advertising. Thetelecommunications marketsegment in Nigeria has seenmany TVCs lately, the latestbeing the Etisalat Easyflex 60"commercial featuring Nigerianborn Hollywood actor, HakeemKae-Kazim.
The creative ingenuity of theTVC has earned thumps-upfrom ad practitioners. AnExecutive Director with a Lagosbased advertising agency, Ms.Benedicta Okoduwa observedsaying, “this new TVC has
ONE of the ways
businesses engagewith the public is through anaspect of marketingcommunications calledadvertising. Advertising as animportant tool of marketingoffers businesses the chanceand channel to present andexplain offerings to the publicin a manner approved by lawso that customers andprospects would be informedon what is or are being offered,with a chance of deciding onwhat to buy.
Likewise, visuals incommunications, particularly in
elevated the discourse inprofessional circles. The timingis good as it tends to drawattention to serious matters asagainst comics, which hasalready begun to bore seriousminds.”
She is of the opinion thatEtisalat has done well for itsEasyflex offering by featuringan internationally acclaimedactor in the TVC because itcomes with many advantages.“Apart from that fact that manypeople will be eager to connectwith the actor, the TVC becomeseasily memorable.”
Okoduwa further says. “I cansay that the idea of using oneactor is unique as only UBA hastried it before now. What no onecan ignore is Kae-Kazim’sacting that differentiates theTVC from everything done inthe past and etches it on theminds of viewers with ease,”she submits.
A Creative Director withAnother ad agency, MaxwellUdofia, noted that bringingKae-Kazim to star in the ad islike spicing the local scene withinternational standard.Nigerians will definitely love it.I love it, myself. One can tellby the level of discourse it isalready generating inprofessionals circles within thisshort space of time.”
These two professionalscommend their colleagues thatproduced the TVC on theexcellent delivery of thestrategic idea, originality andKae-Kazim’s skilful acting thatdelivers that message in aclearly understandablemanner.
Speaking on the deploymentof the Easyflex televisioncommercial, Director, Brandsand Communications, EtisalatNigeria, Mr. Enitan Denloyeexplained that the idea behindbringing Hollywood on to thelocal scene was informed by thecompany’s drive to deliver tothe Nigerian market uniqueproducts and services thatmatch global standards. “Weconsider ourselves asinnovators in thetelecommunications industry, adescription that has reflected inmany of our top valuepropositions and world classcommunication materials sinceinception in 2008,” he says.
Revealing that the TVC is aproduct of a research of theNigerian market by thecompany, Denloye adds:“Having Kae-Kazim as theheadliner for the Easyflexcommercial just goes to showthat we are a brand that iscurrent, vibrant and in touchwith our customers’ tastes andpreferences.”
stakeholders,” commentedCharles Anudu, ManagingDirector of SWIFT Networks.“The ultimate beneficiarieswill be our current, future andDOPC’s erstwhile customerswho will now be served by anetwork with a largercoverage and exceptionalfocus on customerrelationships. We willcontinue to invest in newtechnologies and processesthat deliver values that makesense to them.”
Etisalat’s new commercial easilyflexes minds on TV
SWIFT Networks wireless
and fibre-basedbroadband services tobusiness and residentialusers, has announced thecomplete acquisition of the 4Gbusiness of Direct On PC.
With this transaction, SWIFTwill acquire all the wireless/4G infrastructure and co-related customers of DirectOn PC in Lagos, Abuja andPort Harcourt. The satelliteand enterprise business ofDOPC remain unaffected bythis transaction.
“This acquisition is asignificant milestone in ourjourney to advance ourcompetitive position in thehigh quality broadbandsegment and footprint in theNigerian market. It willimprove our customers’broadband experience andoverall operating results asthe cost efficiencies arisingfrom the economies of scale ofthe streamlined operation willaccrue to our various
“SWIFT and DOPC are aperfect fit as we share acommon passion forinnovation and customersatisfaction. I am happy thatwe found the SWIFT home forour 4G WiMAX customers asthey will join an operator thathas become the undisputedleader in both network qualityand customer service in itscategory”, enthused MaheshSadhwani, the Vice Chairmanof the Bhojraj Chanrai Groupand Owner of Direct On PC.
expand and transform theirbusinesses.
He said; “There is plenty ofgrowth in Africa, especiallyNigeria. We want to be partof the growth. For us, Nigeriais on the top of our businesschart. We are looking at thesize of the country with itshuge population. This is aplace we love to be as acompany and we are buildingour infrastructure here.
and indeed the economywould witness a flip.
A statement by the companyon Monday reported Orelli asgiving the indication duringhis visit to Lagos and stressedthat many established firmswere increasing focusing ontheir core business, leavingthe logistics to those speciallyset up to handle it.
He also said Nigeria’s largepopulation offered a greatattraction for investors to
DHL Global Forwarding,
a leading logistic firmhas said the future of freightforwarding in Nigeria lookspromising, especially forgenuine operators.
Vice-President, DHL GlobalForwarding, Mr. Dominiquevon Orelli, said the boom inthe telecoms industry and theexpected transformation in thepower sector gave anindication that the nation’sfreight forwarding business
BRIEFS Stories byPRINCEWILL EKWUJURU
Swift Networks acquires Direct On PCBy PRINCE OSUAGWU &PRINCEWILL EKWUJURU
Future of business in Nigeria promising–DHL boss
AS part of efforts to proffer
solution to cookingmeals on time, Vowels AALimited has launched Idee’sStew mix, a food breakthroughthat can also replace buying rawingredients in the market.
The Chief Executive Officer,Vowels AA, Dr. OmoniyiAkinleye, spoke on the product,“Idees is made with naturalingredients. It is simple toprepare, it is natural with nochemicals like monosodiumglutamate or preservatives,and it’s a mixture of freshtomatoes, peppers, seasoning,salt, spices and all ingredientsin a dry format to make mealpreparation effortless. You canuse the contents inside thesachet to cook meals like Jollofrice, Egusi soup, Efo riro,Stews, Moin moin, amongothers.”
She added that the idea todevelop a dry powder mix thatmakes cooking easier wasconceived from working longhours and the need to still cookfor the family no matter howtired one was or how late onegets home. Idee’s takes thestress off cooking and offers asolution to the current timechallenges.
GLOBAL archive storage
& shelving solutionsp r o v i d e r - B r u y n z e e l ,Netherland has entered theNigerian market, as it reiteratesimportance of record-keeping.
Speaking at a press briefingin Lagos, ahead of the NigeriaLibrary Association AnnualConference in Calabar,Business DevelopmentManager, Leon Crommentuijnappealed to government andother major stakeholders toreposition informationmanagement & record keepingin Nigeria through theadoption of modern solutionsand practices.
According to him, Nigeria asthe giant of Africa and bigplayer in the global marketcannot afford to leave the futureof her people to chance. Thishe said is because policies andplans depends so much on pastrecords and information, “it isright time government,institutions and corporateindividuals take the right stepsin ensuring that they preservevital records and data for thecoming generation, especially,by the National Museum andNational Library of Nigeria asa legacy and pass-on plantowards sustainable nationaldevelopment” he posited.
Vowels launchIdee’s stew mix
BruynzeelArchive storageenters Nigeria
*From left; Tom Madaki, Wilson Prince Osah, Folashade Omoleye, Sunny Odomoke, Okotie Oritsuwa,Ozioko Bethran Ikechukwu, Emuejevoke Oputu, winners in the Legend Real Deal National ConsumerPromotion, Emmanuel Agu, Marketing Manager, Gulder, Legend & Life, Nigerian Breweries Plc., JamesNweke, Aghedo Cyril Sadiq Ehinoria and Ishalaiye Ayodele, other lucky winners, waiting to shop for giftitems worth N1 million in the Legend Dubai Shopping Experience, at the Deira Shopping Mall, Dubai,United Arab Emirates recently.
46 — Vanguard, MONDAY, JUNE 17, 2013
Advertising, Media& Marketing
THE role ofS m a l l
M e d i u mEnterprises, SMEs,as a catalyst foreconomic growthand developmentcannot be over-looked in aneconomy, and hasbeen recognised assuch in mostcountries.
For example, inmost of newlyi n d u s t r i a l i s e dcountries, more than65 percent of alli n d u s t r i a lenterprises belong tothe SMEs, whichNigeria is notexceptional.
SMEs enjoy ac o m p e t i t i v eadvantage overlarge enterprises inservicing dispersedlocal markets, but inNigeria the case isdifferent.
Conversely, theprogram ofa s s i s t a n c e ,especially in theareas of finance,extension andadvisory services, aswell as provision ofinfrastructure havebeen designed bythe Nigeriagovernment for thedevelopment ofSMEs.
S p e c i f i c a l l y,s u c c e s s i v egovernments inNigeria have in thelast three decadesshown much interestin ensuringadequate financingfor SMEs, byestablishing variousschemes andspecialised financialinstitutions toprovide appropriatefinancing to the sub-sector.
The failure of mostof these schemesrevealed that theproblems of SMEs inNigeria are notlimited to lack oflong-term financingalone, but alsoi n a d e q u a t emanagerial skill andentrepreneurialcapacity.
Firstly, hindranceto obtaining loanswere seen by SMEs
EXP Nigeria, ane x p e r i e n t i a lmarketing agency
said it will be partnering withthe Brand Journalists”Association of Nigeria, BJANin the upcoming AfricanExperiential MarketingSummit (AEMS), billed to takeplace in July 2013 in Lagos forthe first time.
The summit, which isexpected to amplify reach,convert customers and drivesales according to theorganiser, AEMS is taking
SMEs brittled by govt
policies — Simply Gift CEO
EXP, BJAN partner on experiential marketing summitplace in Lagos for the first timesince the annual Africansummit was inaugurated in2000 after it had beenpreviously held in South Africaand Kenya.
According to the Mr. GoddieOfose, Chairman of BJAN, thepartnership is expected to helpthe organisers drive theneeded media coverage.
The summit will be hosted byExp Nigeria – thought leadersin the experiential marketingcategory across the continentto give marketers from the
West African region insightinto how to better theircampaign goals.
The one day summit, whichis themed ‘Re-invent yourExperiences’, will feature someof the world’s leading expertssuch as Dan Hanover, Editor& Founder of Event MarketerMagazine (USA) – the world’sleading provider ofexperiential marketing content– and Kim Skildum-Reid,Sponsorship Author andConsultant (Australia).
Along with other notable
marketing experts, Hanoverand Skildum-Reid willshowcase more than 100 casestudies, highlighting toptrends, the latest best practices,
video tours of events in actionas well as demonstrating howusing live experiencesamplifies reach, convertscustomers and drives sales.
as cumbersome and overbureaucratic, as collateraldemands were seen asexcessive. This is because banksclaim that most SMEs applyingfor loans do not presentconvincing feasibility studies orattractive business plans. SomeSMEs refuted this accusation,saying that banks aredisplaying high-handedness indisbursing loans to SMEs onhigh interest rate. Like theManaging Director of OrlickEnterprises said: “I have beenpursuing a loan to execute acontract for 18 months now, noleeway yet. What I noticed isthat banks regard SMEs inNigeria as high risk venture,they want an alreadyestablished companies.”
Continuing, he said, “asdevelopment banks cannotafford to to take any chances ofnon -repayment of loans, thesebanks insist on collateralrequirements being met.”
Manpower:Most SMEs lack adequate
manpower with the necessaryskills and expertise, thishampers a firm’s ability toproduce quality and timebound products to internationalstandards. Many of the firmstherefore found it difficult tocompete effectively in exportmarkets. Workforcedevelopment also was said tobe hindered by the absence ofskilled labour and trainingfacilities.
Infrastructure:Inadequate infrastructure also
affected large companies almostas much as SMEs. Most largecompanies had to bear heavycosts for the installation andmaintenance of infrastructuralfacilities. Costs which couldhave been borne by the federaland State governments in anefficient system of publicutilities were passed on in fullto these firms.
Like the Chief ExecutiveOffice, Simply Gifts Interior,Mrs. Ifeoma Nwuke noted in achat recently at the opening ofits new office complex whereshe barred her mind on thelimitations of SME growth inNigeria, “we have a lot oflimitations. We battle withcustoms, government policies,banning of fabrics. We reallydon’t know which angle theyare going to go tomorrow. Wecan not really say what is goingto happen in the next fiveyears. It is like planning forone, two, to three years.
Vanguard, MONDAY, JUNE 17, 2013 — 47
48 — Vanguard, MONDAY, JUNE 17, 2013
Business & Economy
Omoh Gabriel - Group Business EditorBabajide Komolafe - Finance EditorClara Nwachukwu - Energy EditorPeter Egwuatu - Head, Capital MarketYinka Kolawole - Snr Bus. CorrespondentFavour Nnabugwu - Insurance CorrespondentGodwin Oritse - Maritime CorrespondentGodfrey Bivbere - Maritime CorrespondentMichael Eboh - Capital Market ReporterOscarline Onwuemenyi - Energy ReporterFranklin Alli - Industry/Agric. ReporterAmaka Abayomi - Money market ReporterEbele Orakpo - Energy ReporterIfeyinwa Obi - Maritime Reporter
CONTRIBUTORSPrincewill Ekwujuru - Media/MarketingNaomi Uzor - IndustryProvidence Obuh - Micro FinanceLAYOUT - Graphics Department
O U R T E A M
THE free encyclopediadefines a ghost, intraditional belief and
fiction, as the soul or spirit of adeceased person or animal thatcan appear in visible form orother manifestation, to theliving, who conversely, hasflesh and blood, and canactually be touched. Thus, inthe absence of physical form,ghosts do not have the normalhuman burden of satisfying theneeds of hunger, thirst, shelter,etc, and therefore, have noreason to seek for jobs and earna living!
Curiously, however, theNigerian public service atvarious levels is reported to beheavily burdened with a ghostpopulation, who unexpectedlynot only write job applicationsand present themselves forinterviews, but who also openbank accounts and collectsalaries, despite their humanshortcomings. Thus, in thepast two decades or so, real (notvirtual) public servantsconsciously apportioned andpaid salaries into the bankaccounts of thousands ofghosts, who inexplicablydutifully collected their salariesevery month, before literallydisappearing into thin airthereafter.
Curiously, the CBN’s“know your
customers” directive to bankswas obviously no deterrent tothe establishment of bankaccounts for such ghosts. In astrategic move to forestalldetection, these ingeniousspirits discreetly also infiltratedthe Nigeria Police Force, wherea 2010 staff-audit revealed thatghost officers accounted for
over 100,000 members, out ofthe officially registered 330,000policemen. The audit reportsfurther revealed apparentcollusion amongst the Policepay officers, accountants as wellas bank officials to successfullyrob the Police Force of overN36bn annually. Thus, in theambience of a ‘bewitched’police community, ghost ratshave had a field day in severalstates and federal governmentestablishments such as PHCNand Defence Ministry.
Similarly, Alhaji MandeLofa, Chairman of Tureta(LGA), also confirmed that averification exercise carried outin July 2011 by the Tureta LocalGovernment Area of SokotoState led to the discovery ofover 500 ghost workers.Furthermore, in December2011, Garba Tagwai, the NigerState Commissioner for LocalGovernment Affairs also notedthat “No fewer than 2,0000ghost workers have beendetected on the pay roll of the25 Local Government Areas ofNiger State”.
While speaking at the EdoState Technology Day
in July 2011, GovernorOshiomhonle also revealedthat, prior to the advent of hisadministration, “the State hadto contend with thephenomena of ghost workersand ghost pensioners inaddition to other abuses of thepayroll system”.
Also, in July 2011, the RiversState Universal BasicEducation Board reportedlosses of N2.4bn annually to1477 ghost workers, while theNational Identity ManagementCommission, in the same
Excise also discovered thatabout 50% of the 20,000workforce in the NigeriaCustoms Service were ghostworkers. Certainly, federalgovernment is not immune tosimilar fraudulent revenueleakages; indeed, as far backas 2001, the incumbentAccountant General of theFederation, Chief JosephNaiyeju, reported the discoveryof 40,000 ghost workersfollowing a man-power
verification exercise conductedby the federal government. Similarly, when Mallam NasirEl Rufai was Minister, of theFederal Capital Territory in2006, 6000 ghost workers weredetected after the completion ofa staff audit, which alsorevealed that the FCTgovernment was losing about$8m annually, due to ghostworkers on its payroll.
The Bureau of Public
Service Reforms(BPSR) with El Rufai asChairman, consequentlysigned a World Bank sponsored$4.9m contract with theNigerian-based System SpecsConsortium in October 2006,for the provision of a morecoherent Integrated Personneland Payroll Information System(IPPIS). Former FinanceMinister, Mr. OlusegunAganga, in July 2011, reportedthat the federal government had removed a total of 43,000ghost workers from the oldpayroll of 112,000 employees inseveral MDAs, between 2010and 2011, through theimplementation of the IPPIS! The IPPIS system is a biometricsystem, where the data of everygovernment employee iscaptured so that salary paymentcan be made directly into thecorrect bank account.
Curiously, also, Chairman ofthe Nigeria Pension ReformTask team, Ahaji AbdulrasheedMaina disclosed in February2012, that on completion of asuccessful nationwidebiometric verification ofpensioners, his team detected71,133 fake pensioners. Furthermore, N151bn fraudwas also uncovered in Pension
offices across the country, withthe assistance of the Economicand Financial CrimesCommission. Regrettably,apparently less than N40bnhave so far been recovered,while about 66 illegal bankaccounts relating to the PensionFund scam have also beenidentified.
In June 2013, the Finance
Minister, Dr. NgoziOkonjo-Iweala, said “215MDAs (153,019 staff) are onthe IPPIS as of January 2013. Savings on payroll cost todate is N118.9bn and work isongoing to bring in other 321MDAs not yet on the IPPIS. About 46,821 ghost workershave also been identified.”Inexplicably, despite inevitabledocumentary evidenceavailable, especially with thebanks, none of the knownbeneficiaries of the ghostworker scam has ever beenprosecuted and convicted orindeed, constrained to returneither the stolen funds or forfeitassets or property derived therefrom.
Critics would therefore beblameless to insist that thislacuna speaks volumes on theseriousness of the currentadministration’s fight againstcorruption! Ultimately, in theabsence of severe sanctions forsuch crimes, even the IPPISwould not be adequatedeterrent to similar ghostbeneficiaries of ourcommonwealth; instructively,ghost contractors, ghostfarmers, ghost fuel subsidyscammers, etc, etc, willcontinue to flourish and ruleour world with activecollaboration of public servants,unless President Jonathanquickly and committedly stepup the war against theseenemies of our people.
month, also revealed that, afterconducting a biometric dataexercise, it had uncovered 4000ghost workers out of about10,300 employees on itspayroll. The Ekiti StateGovernor, Dr. Kayode Fayemi,has also lamented therealization that, prior to hisadministration, the Ekiti Stategovernment loses over N3bnannually to ghost workers outof a projected annual budgetof N80bn. In May 2009, theHouse of RepresentativeCommittees on Customs and
GHOST workers and indulgent exorcists
,
,
Email:[email protected], [email protected] page:www.lesleba.com/blog2Website: www.lesleba.com
Tel:0805 220 1997
Critics wouldtherefore beblameless toinsist that thislacuna speaksvolumes on theseriousness ofthe currentadministration’sfight againstcorruption!
BTG Pactual snaps up Petrobras Africa stake for $1.53bn
REUTERS - Brazil’sBanco BTG PactualSA agreed to buy 50
per cent of the Africanoperations of PetroleoBrasileiro SA, the state-run oilgiant said on Friday,expanding the high-flyinginvestment bank’s role as abacker of cash-squeezedBrazilian companies. BTGPactual agreed to pay $1.53billion for 50 percent ofPetrobras’ African unit,Petrobras Oil & Gas BV, whichhas offices in Angola, Benin,Gabon and Namibia andoperations in Nigeria andTanzania, the statement sai
Petrobras is trying to sell oilfields, exploration rights,refineries and other assets inthe United States, Japan,Argentina, Peru and othercountries to help finance a$237 billion, five-yearinvestment plan, the world’s
largest corporate spendingprogram. It tried to sell theNigerian assets alone for asmuch as $5 billion, Reutersreported on March 13. “Theoperations represent animportant step for Petrobras inits asset-sale program,allowing it to increase itsactivities in Africa and thesharing of investmentsneeded to expand anddevelop its resources,” astatement from Petrobras said.
BTG Pactual, founded andled by billionaire AndreEsteves, has taken advantageof sluggish world demand forcommodities, soaring projectdevelopment costs and risingcorporate debt to buy assetsor sell investment-bankingservices to cash-strapped andstart-up resource companies.In March BTG Pactual formeda partnership with Brazilianbillionaire Eike Batista’s
troubled EBX Group, offeringloans and helping its oil,mining, shipbuilding, portand electricity companiesrestructure. The purchase ofthe Petrobras assets byEsteves’ bank widens itsinvestments in Africa, whereit is seeking out mining andagricultural opportunitieswith B&A Mineração,founded by former Vale SAChief Executive RogerAgnelli. B&A is counting ona recent drop in world metalsand commodities prices tosnap up farming, fertilizer,iron ore and other investmentventures in Brazil and Africaat discount prices.Petrobrasfinds its revenue squeezed byfalling output, delays at newfields and government-ordered fuel subsidies. Theseproblems have made it hardto finance the five-yearinvestment plan aimed atdeveloping giant new
offshore resources near Rio deJaneiro. Instead, Petrobrashas been forced to increasedebt above its self-imposedlimits and try to sell assets.While Petrobras had hoped to
sell $14.8 billion of Brazilianand international assets overfive years, a lack of interestand low offers forced it to cutits estimate in March bynearly 40 per cent to $9 billion.