APRIL 4, 2016

CMYK

Continues on page 18

BY PRINCEWILL EKWUJUJRU

Tomato paste manufacturersacross the country have decriedthe $1billion (N12billion) spent

annually by Nigerians on tomato pasteimportation. Financial Vanguardinvestigation showed that there isenough local production capacity tomeet national demand. Howeverdespite local capacity to supply theNigerian market, importation of theproduct at dumping price issuppressing local production. As a

result of local producers’ inability tocope with the current level of dumpingof the commodity via import, over 3,000jobs have been lost across the industry.Tomato paste is not a prohibited item,but Nigeria manufacturers said, theyhave the capacity to meet demand.

Managing Director of Sonia FoodsIndustries Limited, Nnamdi Nnodebe,who spoke under the aegis ofManufacturers Association of Nigeria,MAN Tomato manufacturers, a keyoperator in the industry said, “Nigeriais the second highest producer of

tomato in Africa and 13th in the world.Still, it spends N12billion annually, onimportation of tomato paste.

“Sadly, about 750,000 tonnes oftomatoes harvested in Nigeria, gowaste, with over 3,000 workersdisengaged as a result of poor FoodSupply Chain, storage managementand price instability.

“Under the new foreign exchangepolicy regime, 41 items including tripleconcentrate used for producing tomatopaste were barred from access toforeign exchange needed as raw

materials for processing and productionof finished tomatoes paste. It isparamount on the mind of tomatoproducers, and it would only be idealto support us, actualise this ambitionfor the good of our economy.”

Nnodebebe said: “Once this isactualised, more jobs would be createdand more importantly exports wouldstart to happen because Nigeria hasthe potential to become leadingexporter of concentrates, if given theprerequisite support.

“One way, we could make thishappen, is partner the northern states,since tomato cultivation thrives in theNorth where it finds favourableclimate, Governors in the North shouldendeavour to work together withcredible manufacturers to speedilyachieve backward integration.”

He went further to say, “Thisdevelopment has become a challengeand has left manufacturers groaningunder the weight of the current policywhich has made it difficult for them toaccess raw materials. “I am veryconfident, if given this allowance, itwill work together for our good andfor the economy, because Sonia Foodscan complete a tomato factory farm,requisite for processing tomatoconcentrate, within two years.”

Manufacturers Association ofNigeria, MAN President, Dr. FrankJacobs, said, “in order to address thischallenges government shouldthrough its fiscal/monetary policymaintain duty of 20 percent andadditional levy of 30 percent onfinished tomato in retail packs.”

He went further to say thatimportation of tomato paste in sachetshould be prohibited to encourage localvalue addition and to protectconsumers against the health hazardsarising from short shelf life of sachetproducts.

“There should be strict measuresagainst imported substandard andsmuggled products, specific targetshould be given to appropriateresearch institutes to developseedlings and projects that will leadto replacement of imported tomatopaste and government should be readyto give necessary financial supports,”he pointed out.

Earlier, Former National Agency forFood and Drug Administration andControl, NAFDAC Director General,

LAUNCH - From left: Adeniji Kazeem; Prof Pat Utomi; Prof Ademola Abass and; Mr Tunji Bello at the launching ofOffice of Overseas Affairs and Investment Lagos Global in Lagos.

Manufacturers kick, call for banLocal tomato industry comatose

3,000 jobs lost to N12bnannual tomato imports

18 —18 —18 —18 —18 — Vanguard, MONDAY, APRIL 4, 2016

Cover

Turning great Ideas into great money

Have a great business idea is only the first step inthe journey to raising your business empire.Turning your business idea into a money- making

venture requires raising the capital necessary to get yourblessing running and that represents the next step ofthousands of other steps. In starting your own business, themost challenging task you have to face as an entrepreneuris raising money as capital.

The ability to raise money to start a business is one of thetests you must undergo as an entrepreneur. As daunting asit may seem, the challenge of raising money is not as toughas you think. It is no secret that in your quest to raise moneyto start your business you are bound to face a lot of obstacles.It would be very unfair of me to promise you otherwise.However, the good news is that it can be done as there aresome people, some institutions and some organisationswilling to look at investing in start – up businesses.

There are many tried and tested ways of raising money tostart your business which have been used by many famousentrepreneurs whose businesses have become householdnames, including Bill Gates (Microsoft), Michael Dell (Dellcomputers) and Richard Branson (Virgin), to name a few.For maximum success, you would do well to use a combinationof different tactics to employ when you want to raise capitalfor your great business idea.

Using feasibility business IdeasThe first and basic key to raising money is to have a business

idea that is feasible, that is practicable, and that is workable.You wonder why? The first question any investor youapproach will ask is this: How profitable is your businessidea? That is because no investor will want to put his moneyin a business that is impossible and not viable. They willalso want to know the expected return on their investmentand the time frame within which to recoup their initialinvestment. Before you embark on a quest to raise money,carry out a feasibility study to determine the profitability ofyour business idea.

Using a business planAnother prerequisite in the process of raising money for

your business idea is a good business plan. One of your firstmoves when you want to source for funds to start yourbusiness should be to put a comprehensive business plan.Your business plan will include details of your background,education, training experience and any other personalqualities you possess. Your personal qualities and experienceare often regarded as assets to your business. Your businessplan should also explain in detail the modalities of how youare going to use the money you need.

It should also explain in detail your proposed businessidea, associated expenditure, the market researchundertaken, and your financial projection and so on. Aboveall, your business plan should describe in detail what makesyour business differs from that of your competitors. Whatwill interest your investors the most about your business planshould state precisely what any investor should expect asreturns on their investments and also, when and how youare going to pay it.

Personality, Appearance and presentation styleNext thing to consider is your personality, your appearance

and your presentation style. When approaching an investor,remember you have only a chance to create an impressionin his or her mind.Therefore,you must be conscious of yourappearance, don’t appear rough and unkempt and, please,try to look professional. In the game of raising money foryour business, appearance matters a lot.

Now to your presentation style: your manner of presentationwill determine the success or failure of your quest to raisemoney for your business idea to your investors with a highlevel of confidence, because the better you are atcommunicating your strengths to them, the better yourchances of raising money. If you lack communication skills,read up books on the topic.

Continued from page 17

How to get funds for yourHow to get funds for yourHow to get funds for yourHow to get funds for yourHow to get funds for yourbusinessbusinessbusinessbusinessbusiness

Paul Orhii, had complainedthat 90 percent of packagedtomato paste from China aresub-standard and dangerous.

Re-echoing the dangerinherent in the consumption ofsubstandard tomato productsin Nigeria, Chief EricUmeofia, Chairman/CEO ofErisco Foods, said: "Most of theimported tomato products areonly here to “kill” Nigerianconsumers and not to satisfytheir domestic needs.

Umeofia said: “To establish atomato paste manufacturingcompany in Nigeria is not onlya burden, but very traumatic.I’m the first indigenousproducer of tomato paste in allthe sizes both in sachet andtins. And for many years, Ihave been doing thataccording to the standards ascertified by NAFDAC andStandard Organization ofNigeria (SON). I also have theapproval of Nutrition andPrivate Medical Practitionersof Nigeria (AGPMPN). It is myhumble sacrifice to themotherland, at least to help inturning Nigeria from import-dependent to export drivennation.”

Unfortunately, this aspirationis collapsing due to lack ofstringent measures by relevantregulatory authorities—federalministries, Nigerian CustomsService as well as other policymakers to checkmate unbridledimportation of tomato pastebrands into Nigeria.”

He lamented that all hisefforts to produce qualitytomato brands have beenrendered useless by thepresence of imported sub-standard products, blaming therot on some greedy Nigerianmerchants in collaborationwith some Chinese

manufacturers. FinancialVanguard investigation tounravel the process andprocedure of bringing inproducts through Seme landborder met with brick wall asthe the whare house ownersspoken to refused answers toquestions posed. Investigationrevealed that two cartoons of70gram tin tomato containing50 pieces without duty, costsN500 to smuggle into Nigeria.For those who pay dutycomplain of high tariff andbeaucratic bottle neck, but

bribes to over 25 road blocksmounted by Customs,Immigration and the Police.Along the road.

Most of the tomato brandsin the market do not haveindication of country of origin,expiring and manufacturingdates, those with expiringdates were reprinted. Insightinto Okeari market, IganIduganru and Alaba sururevealed most of the itemscome in the middle of the nightwhen nobody would notice.

3,000 jobs lost to N12b annual tomato imports

MEETING - From left: Manager, Corporate Marketing Sustainability,Honeywell Flour MillsPlc, Mrs. Ebele Oluwalana; Trade Marketing andSustainability Manager, Mr. Adedayo Adeniyi;Project From left: Chief Compliance Officer, Stanbic IBTC, Mr. Opeyemi Adojutelegan; ChiefCompliance Officer, Access Bank Plc/Chairman, Committee of Chief Compliance Officers ofBanks in Nigeria, Mr. Pattison Boleigha; Managing Director/CEO, Keystone Bank Limited Mr.Philip Ikeazor and Chief Compliance Officer, Keystone Bank Limited, Mrs. Joyce Obi, duringthe monthly meeting of the Committee of Chief Compliance Officers of Banks in Nigeria heldin Lagos.

The Area Comptroller,Kiri-kiri Lighter

Terminal Command of theNigeria Customs Service (NCS),Comptroller Benjamin Aber, hassaid that the Mile 2 Apapaexpress way gridlock occasionedby petroleum truck drivers isscaring investors away.

Aber said this at aStakeholders’ meeting held bythe command just as he gave atwo weeks ultimatum topetroleum tanker drivers to quitthe environment.

According to him, “ForeignDirect Investment can only comewhen we create an enablingenvironment that is secured,predictable and transparent. Mystrategy is to make this peopleaware that my governmentcannot accept this nuisance andif we must attract business, wemust first clear all the tankers orthey do things in a manner thatis disciplined and orderly thatwill not attract insecurity.

“What we are trying to do iscreate a very good enabling

Gridlock at Lagos portscaring investors

BY PROVIDENCEOBUH

environment for people whowould like to come and dobusiness.”

He explained that there wasneed to create a corridor alongthe tank farm and jettyoperational area to free the exitand entrance of the environmentof the terminal. “It is part ofCustoms mandate to ensure thesecurity of its environment andnot only to generate revenue.

“If the environment is notaccessible, investors will notimport into the country and thereis no way we can generaterevenue for governmentbecause it takes more than fivehours for anybody to come inand do business.

Meanwhile, the comptrollerassured that he would berestructuring the command,saying, “I am proposing toremodel the KLT command tohave a befitting presence as acommand. With the approvaland support of the ComptrollerGeneral of Customs (CGC), I amgoing to deliver a newcommand at all levels ofoperation, procedure,environment and security."

Vanguard, MONDAY, APRIL 4, 2016 — 19

The recently held two-dayNational Economic

Council (NEC) Retreat endedwith a number of resolutions.The expectation of mostNigerians is that the meetingwill come up with an economicagenda that reflects the changein approach to governance andeconomic management. Theretreat started with a fanfarethat looked like some seriouseconomic policy outline wasgoing to come out of it. At theend of the meeting, Nigerianswere disappointed with theoutcome.

The fact that the retreat was ameeting point for Governors,serving ministers and the Vice-President, to any serious-minded Nigerian who isconversant with the waygovernance is run in Nigeria,would not expect any seriousout-of-the-box thinking to havecome from the meeting. In thefirst instance, a number of thoseat the meeting do notunderstand the workings of thevarious sectors of the Nigerianeconomy and their linkages toproffer an all-embracing policydirection for the nationaleconomy. They are well awarethat the various arms ofgovernment are financiallyhandicapped and that theycannot on their own, provide theneeded funding to revive theailing economy. Many of theattendees are political officeholders who know next tonothing about the principle ofa functioning economy.

Given their limitations onsound economic matters, the

NEC retreat resolutions:Failed change mantraexpectation

expectation was that these publicsector officials would haveinvited key stakeholders,economic experts from withinand outside to dialogue on howto chart the way forward.Politicians that were madeministers would always playpolitics with the welfare of thepeople. If the aim of the retreatwas to generate medium andlong-term policies that willaddress challenges withindiscussed areas of the economyat both the federal and statelevels, then it was amiscalculation to have excludedthe organised private sector fromthe discussions. It was equallyself- seeking on the part of theorganisers of the retreat to haveleft out expert advice on thisissue.

There is basically no differencebetween what the groupdiscussed from what hashappened in the past. As agovernment of change, theexpectation is that the approachto governance and economicmanagement will be totallydifferent from that of the past.Nigerians need a break from thepast where governmentfunctionaries spend public fundsorganising talk shops that leadthe country nowhere.

Developing the Nigerianeconomy should be a knitpartnership between the privatesector and the public sectorwhich duty is mainly to set therules and provide a level-playing field for private sectoroperators. Nigeria’s public sectormanagers have to change theirmentality toward economic

management. In fact, publicsector hold on the economy hasbeen the bane of the nation’sprogress. Their attitude to theprivate sector is that ofsuspicion. They have neverseen the private sector aspartners and would not like tolose the power they hold onthe economy. They arepatriotic while others aresaboteurs.

Funny enough, the retreatsets up two implementationcommittees made up of mostlychief executives of states andspending ministries. Theimplementation committee isheaded by the Vice-Presidentand Chairman of NEC, Prof.Yemi Osinbajo.

The question is how are theygoing to implement thedecisions when they are not in

a position to invest either theirmoney or government fundsinto the sector for productiveactivities? At best, they are tobe seen as facilitating agents.At the close of the retreat, themembers resolved that therewas need for concerted andconsistent efforts to diversify thenation’s revenue sources andexpand compliance on VAT,adopting a gradual plan for rateincrease. Who is going to paythe increase in VAT? Is itgovernment or the privatesector and the Nigerian public?If the members of the NationalEconomic Council are not intouch with the public, theyshould know that there ispoverty in the land and mostcompanies are barely survivingthe hard time. Increase in VATwithout carrying the payeesalong will meet with resistanceand failure.

Besides, the Council has setthe target of national self-sufficiency in Tomato paste for2016, Rice for 2018 and Wheat2019. How realistic are thesetargets? What is the currentnational demand for theseproducts and what is the localproduction at the moment? It isgood to set targets but what arethe value chains process tofollow the self-sufficiency? It isnot just farm produce, butstorage, processing, packagingand access to markets. Are allthese processes in place forNigeria to achieve the setgoals? What is the standard setby the authority for companiesto meet before each of theproducts can be accepted in thelocal and international market?Has the government plannedmarket access for localproducers who may want to

export their products?The demand for tomato for

instance is currently estimatedat 2.3 million metric tons perannum, while the local outputis 1.8 million metric tons butdue to lack of good storagefacilities and poor developedmarketing channels, up to 50per cent of the tomato producedin Nigeria is lost. Recently, Dr.Richard Munang, the AfricanRegional Coordinator of TheUnited Nations EnvironmentalProgramme, UNEP, lamentedthat Nigeria spends $1bn toimport tomato paste.

Central Bank Governor, Mr.Godwin Emefiele said at astakeholders’ meeting withofficials of Paddy RiceProducing states and Rice Valuechain investors in Abuja that theFederal Government spent$2.41 billion on rice importationbetween January 2012 and May2015. He argued that the bank’sdecision to ban foreignexchange for importation ofrice; fish and other items wouldnot be reversed.

This scarce foreign exchangewould have been saved ifNigeria had achieved self-sufficiency in the chosenproducts. This is not the firsttime that the Nigeriangovernment is setting suchtargets. How much attention isthis government paying to thedetails in the productionprocess of what is beingproduced in the country? Whatis the quality assurance for theconsumer? Nigerians areobsessed with quality andbeauty. The packaging is asimportant as the content. Theseare details that NEC shouldcome out with if they are to betaken seriously.

Cover StoryBusiness risk in Nigeria up by 50% this year — KPMGBY EDIRI EJOH & ILOAZEBLESSED-ODIDI

There are indications thatNigeria may be

heading for difficult timesahead as survey carried out byKPMG professional servicesrevealed that businessenvironment across all sectorsof the economy are exposed to50 percent risk from unstablesocio-political environment andincreased pressure fromregulators in the country.

This was revealed at theKPMG Nigeria maiden editionof its Report on the top 10Business Risks for 2016, heldat its tower yesterday.

KPMG officials present at thelaunch included; AssociateDirector, Risk Consultant, Tolu

Odukale, Partner and Head, RiskConsulting, Olumide Olayinka,Partner, risk consulting, TomiAdepoju, Assistant manager, riskconsulting, Seun Olaniyan,Partner, Head, Financial riskmanagement, Umerry Mbuniand Head, Sales and Marketing,Nike Oyewolu,

Speaking at the pressconference and launch of theRisk Report, Partner, RiskConsulting Services, Mrs. TomiAdepoju, said the need fororganizations to strengthen theirrisk management practicescannot be overemphasized.

Her words: “The riskmanagement survey carried out,show that the businessenvironment in 2016 will bequite challenging for all sectorsof the economy. The report

identifies the key risks likelyto affect businesses in themanufacturing, energy andtelecommunications sectors in2016, including notabledifferences in viewpoints andkey next steps for businessesin the Nigerian economy.

“However, with the right riskmanagement strategies,organisations stand a chanceof transforming potentiallycrippling risks into acompetitive advantage andsustaining their performancein spite of the prevailingchanges in the operatingenvironment.”

According to the survey, keyfindings on the top tenbusiness risks for 2016 are:Macro-economic risk, crude oilprice, political risk, energy

risk, security, capital availability.Others areas are, regulatoryrisk competition, supply chainand business continuity anddisaster recovery.

The report further stated thatsurvey respondents believedthat their organizations havebeen exposed to increased risksover the last two (2) to three (3)years. Also, more than 50percent believed that anunstable socio-politicalenvironment and increasedpressure from regulators haveincreased their risks.

“Additionally, onerous andoften overlapping regulatorycompliance requirements havealso given rise to increased risksover the years. Moreso, 81percent are likely to devote moretime and resources to risk

management in 2016. Out of thispercentage, 53 percent arealmost certain that they would.”

On the way forward, thereport stated that “Based on thesurvey results, it is clear thatexecutive management todayface an unprecedented numberof new and emerging risks thatcan threaten corporate strategyif they are not proactivelyidentified and properlymanaged.

“They will need to keep a closewatch on these risks this year.It is imperative for eachorganisations to carefullyevaluate and put an effectiveenterprise-wide riskmanagement structure andprocess in place. If you havebegun the risk managementjourney,

It was amiscalculationto have excludedthe organisedprivate sectorfrom thediscussions. Itwas equally self-seeking on thepart of theorganisers of theretreat to haveleft out expertadvice on thisissue

20 — Vanguard, MONDAY, APRIL 4, 2016

CMYK

Business & Economy

As a response to the growing need for thedevelopment of non-oil sectors in the

country, over thirty-six Indonesian companies fromwithin and outside Nigeria will feature at themaiden edition of the Indonesia Solo Exhibitionbilled to take place in Lagos early next month.

The three-day event organized by theIndonesian Trade Promotion Centre, ITPC, Lagos,in collaboration with the Embassy of the Republicof Indonesia, Abuja, is being supported by theMinistry of Trade of the Republic of Indonesia.According to the Director, Embassy of the Republicof Indonesia, ITPC, Nino Wawan Setiawan, thepurpose of the exhibition is to draw Indonesianindustrialists to Nigeria by reshaping theirperception about the nation.

“We are bringing to Nigeria Indonesian leadingindustrialists in the areas of agriculturalequipment, food and beverages, jewelries and

Indonesia plans exhibition to draw investorsto Nigeria

handy crafts, textiles, fashions, drugs andmedical equipment, pharmaceutical andcosmetics.

“We want them to come and see for themselvesthat Nigeria is a very huge market with about170 million population, a conduciveenvironment, favourable seasons and weathervis-à-vis good government policy which favoursinvestors.

“We also want to correct the wrong impressionthat Nigeria is a jungle like they read about inmagazines and watch in documentaries aboutAfrica,” he said.

Part of the strategies of the exhibition,Setiawan disclosed, will include a specialcocktail business meeting with businessexecutives and the trade delegation fromIndonesia, where processes on investments inNigeria would be discussed with subsequentblueprints of business networks and supportideas that would harness untapped businesspotentials that richly exist in Indonesia.

Presidencydirects HOS,NAICOM toprotectgovt’sassets

The Presidency hasdirected the Head of

Service to work with theNational InsuranceCommission (NAICOM) toensure adequate protectionof government’s assets.

The News Agency ofNigeria (NAN) gathered thatthe directive was madethrough a letter signed by theChief of Staff to PresidentMuhammadu Buhari.

According to the source,the Head of Service has beendirected to coordinate allrelevant permanentsecretaries and Heads ofExtra MinisterialDepartments to ensurecompliance with theNAICOM Act 1997.

NAN reports that the apexinsurance regulator, in anotice, requested for detailsof all insurance policies inrespect of all governmentassets and liabilities as atFebruary.

According to the notice, theact mandates the commissionto ensure adequateprotection of governmentassets as well as advise thegovernment on all insurancerelated matters.

It stated that thecommission had put in placenecessary machinery toeffectively discharge thefunction, to ensure properprotection of public assetsand value addedtransactions for thegovernment.

“ Pursuant to the exerciseof the powers conferred onit by extant laws, NAICOMhereby requests allMinistries, Departments andAgencies (MDAs) ofgovernment to furnish it withdetails of their insurances.

“ The required informationwill enable the commissionto keep accurate data foreffective tracking ofinsurances of governmentproperty and assets andassist in ensuring theirconformity with appropriateinsurance principles.

“ The information to beprovided are as specified inthe template enclosed in theletter already circulated toall MDAs by thecommission,” it stated.

Lagos State GovernorAkinwunmi Ambode

has unveiled the Office ofOverseas Affairs andInvestment, otherwise knownas Lagos Global. The LagosGlobal, an initiative of theAmbode administration, is aone-stop shop designed toenhance ease of doingbusiness in Lagos State andalso actualize the state’s visionof becoming Africa’s modelmegacity and global economicand financial hub.

At the official presentation inLagos, Governor Ambode, whowas represented by theSecretary to the StateGovernment, Mr. Tunji Bello,said the initiative was in linewith the commitment of hisadministration to make Lagosan investment destination of

Ambode launches one-stop shopfor investors

choice by creating a favourableenvironment for local andForeign Direct Investment(FDI). He said, for instance,that Lagos State remained thedesired investment destination,having attracted massive FDIsuch as the $1.65 billion LekkiDeep Seaport and the $12billion Dangote Refinery andPetrochemical Plant amongother investments coming tothe State.

Ambode assured that theseaport would be completed in2019 and upon completion willbe the deepest seaport in Sub-Saharan Africa. He also said theBadagry Creek Industrial Park,a $1.3billion investment, wouldbe completed in 2018.

His words: “As the worldcontinues to acknowledgeLagos as a regional financial

hub, we as government havedemonstrated the commitmentto strengthen this positionthrough deliberate policiesaimed at improving thebusiness climate in our state.

“In this regard, we havesuccessfully placed Lagos oninvestors’ radar by putting inplace effective legal andregulatory frameworks such asthe Land Reform Act, DoubleTaxation treaties, LimitedLiability Reviews and thedevelopment of Free TradeZones. Likewise, the on-goingjudicial reform is aimed atstrengthening our laws for theprotection of enterprise.”

Ambode also said hisadministration’s consciousefforts at public infrastructuredevelopment and maintenanceas indicated by an efficient Bus

Rapid Transit (BRT),transporting over 200, 000passengers daily, functionalIntegrated Power Projects,enhanced security and accessroads to sea and airports,among others, underscored itsdetermination to make Lagos afunctional megacity.

Earlier in his welcomeaddress, Special Adviser to theGovernor on Overseas Affairsand Investment, Prof. AdemolaAbass, said Lagos Global wascreated by the currentadministration to act as one-stop shop with the mandate ofpromoting foreign investmentinto the state and managingexport out of the state.

He also said the office has themandate of managing foreigninvestment transaction andensure that would-be investorsenjoy seamless and hurdle-freeexperience by providing firstclass service delivery to themright from the point of initialenquiry down to the setting upand running of businesses inthe state. This, he said, wouldeliminate difficulties andbureaucracies often associatedwith multi-agencies handlingof investments. “Never againwill an investor give up thehope of setting up business inLagos State on the obstacles ofsuffocating an interminablebureaucracy. The job of LagosGlobal is principally to enhancethe ease of doing business andcreate an enabling environmentfor investors,” Prof. Abass said.

In his keynote address,renowned economist andFounder, Centre for Value andLeadership, Prof. Pat Utomisaid the creation of LagosGlobal is a major step towardstransforming the state to amodern city-state just like theadvanced ones in the world.

“Lagos can play the kind ofstimulating role Singaporeplayed in South east Asia,”Utomi said, adding that Lagoseconomy must therefore, be a24/7 economy, and that thegrowth of the state requiressignificant cooperation fromneighbouring states.

Utomi said Lagos offers hopefor rapid growth of the countryin the sense that it has thecapacity to serve as the yard-stick to measure and encouragedevelopment, but that therehas to be a concerted effort tomake the state a more attractiveidea of a developmental state.

Utomi also said there is needfor a change of mindset bythose driving the process, andthere must be a well drawn outplan to round up everythingthat Lagos represents in termsof possibilities through abranding process.

BY JOSEPHINE AGBONKHESE

CONFERENCE - rom left: The Head, Brand Management of First City Monument Bank(FCMB), Mrs. Adeyosola Atere; the Divisional Head, Private Banking of the Bank, Mrs. AleroAdollo; Co-Founder of The Life House, Mrs. Ugoma Adegoke and the Divisional Head, HumanResources and Strategy of FCMB, Felicia Obozuwa, during the Woman Rising Conferenceheld recently in Lagos to commemorate this year's International Women's Day.

Vanguard, MONDAY, APRIL 4, 2016 — 21

CMYK

Insurance

FG allocates N14.69bn for grouplife in 2016 budgetBY FAVOUR NNABUGWU

The Federal Governmenthas voted N14.69 billion

for group life for itsMinistries, Departments andAgencies (MDAs) in the 2016Appropriation Bill passed bythe National Assembly onMarch 23, 2016.

The insurance industry onits part would receive N14.69billion earmarked for Grouplife for Ministries,Departments and Agencies(MDAs) of the FederalGovernment, includingDepartment of State SecurityService (DSS), Insurance ofSensitive Assets and Corpers.

The N14.69 billion for grouplife Insurance policy was partof the total of N154.3 billionvoted for pension paymentsof Federal Governmentretirees, including monthlypensions and arrears ofgratuities.

Out of the N154.3 billion,the pension industry wouldreceive N139.73 billion onpension payments, includingmonthly pensions, arrearsand gratuities.

A breakdown of the budgetshowed that the militaryalone would receive N59.8billion for payment ofpensions and gratuities. It

also showed that N7.41 billionwas earmarked for PolicePension, while Customs,Immigration and PrisonsPension got N8.42 billion.Allocation to Department ofState Security Serviceincluding arrears, got (N7.64billion), Nigeria IntelligenceAgency Pensions anddependants’ benefits received(N3.7 billion).

Meanwhile, N26.75 billionwas budgeted for ParastatalsPension and Railway

Pensions, while pre-1996Nigeria Railway CorporationPension got N2.25 billion.

The budget showed thatN3.52 billion was earmarkedfor expected retirees in 2016,while N4.3 billion wasearmarked for death benefitsand N14.34 billion forUniversities’ Pensions,including Arrears.

Office of the Head of theCivil Service (CivilianPension), received N28.39billion for Pensions and N2.3

billion for Gratuities, whilebenefits of Retired Heads ofthe Civil Service of theFederation and FederalPermanent Secretaries standat N2.59 billion. Under theService-Wide votes, N3billion was earmarked forpayment of Arrears of PAYGPension DPR, N27.4 billionfor payment of Arrears of 33per cent increase in PensionRates and N500 million forpayment of outstandingDeath Benefit to Civil.

Lloyd’s Chief Executive,Inga Beale, has warned

that man-made risks such asterrorism, cyber attacks andclimate change are nowbigger threats than naturaldisasters.

Her comments were made inreference to the Lloyd’s cityrisk index, which found thatnearly half the economic risksfaced by 301 cities around theworld were linked tomanmade threats, includingmarket crashes, cyber-attacks,power outages and nuclearaccidents.

According to Beale, Lloyd’swas likely to face some claimsin relation to the Brusselsattacks and other recentterrorist incidents. But despitethe growing demand forterrorism cover from local citygovernments and businesses,claims are relatively few andunlikely to result in substantialinsurance losses.

She also said that climatechange is another majorthreat, which affects someareas of the world that “don’t

Man-made risks now bigger threats than naturaldisasters —Lloyd boss

really know about insurance”.Eight Lloyd’s syndicatesincluding Amlin, Beazley andHiscox launched a $400minitiative in November to workwith governments to tackleunder-insurance indeveloping economies.

Beale’s comments came asLloyd’s recently posted a 30%fall in 2015 profits, with pretaxprofits falling from £3bn in2014 to £2.1bn in 2015. Hit by

a sharp decline in investmentreturns in the wake of ultra-low interest rates, as well asprice declines amid risingcompetition, major lossesincluded the Tianjinwarehouse explosion inChina and a fire at a platformrun by Mexican oil companyPemex.

“In a market undeniablytougher than seen for manyyears, we have had todemonstrate our ability toadapt and take action,”Lloyd’s chairman Mr John

Nelson was quoted as saying.According to Beale, Britain

is better off staying in the EU,given that the EU had tradeagreements with 50 othermarkets and was in theprocess of agreeing a majordeal with the US, theTransatlantic Trade andInvestment Partnership.

She said that a vote to leavewould be a major blow to theinsurance industry, which ishighly regulated and wouldneed to deal with regulatorsin individual countries.

GuineaInsurancecomplieswith code ofgoodcorporategovernance

Guinea Insurance Plchas moved to ensure

sound business practicesand effective compliancewith all statutoryrequirements and the codeof good corporategovernance as stipulatedin section 5.04 (vii) of the2009 CorporateGovernance Code ofNAICOM.

To this end, the companyhas announced theretirement of its Chairmanand four Directors; havingserved over nine years onthe board of the company.

Consequently, Sir EmekaOffor (Chairman) and fournon-Executive Directorsnamely, Mr. FredUdechukwu; HRH EzeSmart Nze; Prof. E.L.CNnabuife and Engr. EmekaAgusiobo retired from theBoard of the companyeffective March 23, 2016.

In a statement, thecompany said it haspositioned itself to go withthe current tide ofstructural and operationalchanges in the insuranceindustry.

The Board also approvedthe appointments of Mr.Anthony Achebe; AlhajiHassan Dantata; SimonBolaji; Chief OsitaChidoka; Mr. EmekaUzoukwu; as well as Dr.Mohammed Tahir Attahiras non-Executive Directorswhile Alhaji A.O. Kadiriwas returned as theindependent Director ofthe company. BarristerGodson Ugochukwu wasalso appointed Chairmanof the Company to replaceSir Emeka Offor.

In the same vein, theBoard also approved theappointment of IsiomaOmoshie, the CompanySecretary/Legal Adviser asthe acting MD/CEO untilthe appointment of asubstantive MD/CEO isratified.

This is coming on theheels of the recentresignation of the erstwhileMD/CEO, Mr. PolycarpDidam, who has moved onto pursue other interests.

SYMPOSIUM - From Left; Ms Sola Salako,President/CEO,Consumer Advocacy Founda-tion of Nigeria;Alhaji Garba Bello Kankarofi;APCON Registrar and Mr Wole Ogundare,ClientService Director;Insight Communication Ltd.At the 4th Brand Journalist Association ofNigeria[BJAN]Consumer Right day Symposium 2016;THEME;Banking in NigeriaDevelopments and Customers Challenges held at White House Hotel GRA Ikeja Lagos.PHOTO:BY AKEEM SALAU.

CONFERENCE - From left:The Head, Brand Managementof First City Monument Bank(FCMB), Mrs. AdeyosolaAtere; the Divisional Head,Private Banking of the Bank,Mrs. Alero Adollo; Co-Founder of The Life House,Mrs. Ugoma Adegoke and theDivisional Head, HumanResources and Strategy ofFCMB, Felicia Obozuwa,during the Woman RisingConference held recently inLagos to commemorate thisyear’s International Women’sDay.

22 — Vanguard, MONDAY, APRIL 4, 2016

CMYK

Banking & Finance

BRIEFING - From left: Omolara Akinfolarin, Head, MSME Banking, Proposition & Products;Abubakar Suleiman, Executive Director, Finance & Strategy, both of Sterling Bank Plc andNdifreke Okwuegbunam , Programme Manager, LEAP Africa at the press briefing launchingthe 2016 edition of the nationwide MSME Academy organised by the bank.

electrical equipment. Theremaining four sub-sectorshowever reported expansionin the following order:petroleum & coal products;food, beverage & tobaccoproducts; cement andchemical & pharmaceuticalproducts.

“The composite PMI for thenon-manufacturing sectordeclined for the thirdconsecutive month. However,the index improved to 45.4 percent, compared to the 44.3points registered in thepreceding month. Of theeighteen non-manufacturingsub-sectors, sixteen subsectors reported declines inthe month of March in thefollowing order: managementof companies; construction;real estate, rental & leasing;finance & insurance;wholesale trade; utilities;accommodation & foodservices; professional,scientific, & technical services;public administration;transportation &warehousing; health care &social assistance; electricity,gas, steam & air conditioningsupply; arts, entertainment &recreation; water supply,sewage & waste management;information & communicationand repair, maintenance/washing of motor vehicles.The remaining two subsectorsreported growth in the reviewmonth in the order:educational services andagriculture.”

In an apparent bid toincrease market share of

the bourgeoning mobilebanking market, GuarantyTrust Bank has introducedBank 737 mobile bankingservices.

Bank 737 offers a very simplebanking alternative whichremarkably does away withvirtually all of the limitations ofnot just conventional banking(going to a bank branch forbanking services), but alsoonline banking. Whileconventional banking requiresthe physical presence of thecustomer at a bank branch, andonline banking demandsInternet access and a mobileapplication, banking via 737requires none of the above. Bank 737 is a true test ofsimplicity. GTBank customersno longer need to bother aboutdata or internet connection asthe service is built on a USSDinterface which enables it workon any type of mobile device.Users are required to simplydial the short USSD *737# fromany mobile phone to get started.

GTBank’s Bank 737 offersa wide range of bankingservices, from money transferto card less withdrawal, billpayments, airtime rechargeand even unique services liketoken pin generation, checkingthe status of cheque bookrequest, retrieving internetbanking details, amongstothers. It is not just about thewide range of servicesavailable on the 737, but howthe services are delivered; bysimply dialing *737# on anymobile phone.

If the simplicity of the Bank737 is amazing, its speed iseven more so. Transactionsusing the 737 take less than aminute to conclude, meaningit is even quicker than onlinemoney transfer. It gets evenfaster with the availability ofshort access codes. Amongthese are *737*0# for accountopening, *737*7# to generatetoken code,*737*37*Amount*Smart CardNo# to pay for Star TimesSubscription and so muchmore.

Backing up its simplicityand speed, is its security. Thecustomer is the only one whocan access the 737 service forhis or her GTBank Accountbecause it only makes use ofthe mobile number that islinked to the account. Bank 737also requires customers topersonally sign off all theirtransactions by providing thefour last digits of your GTBankNaira MasterCard.

GTBank intensifiesmobile bankingcompetition withBank 737

There are indications thatthe slowdown in

economic growth recordedlast year persisted in the firstquarter of this year.

Last year, the nation’s GrossDomestic Product (GDP),which reflects amount ofgoods and services producedin the economy, grew by2.79 per cent, less than halfof the 6.22 per cent recordedin 2014.

Indication that this trendpersisted in the first quarterof 2016 emerged from theCBN’s Purchasing ManagersIndex (PMI) for the month ofMarch, which revealeddecline in business activities,productivity level, new orderand employment generationin the manufacturing and nonmanufacturing sectors.

According to theManufacturing Sector PMI,“Production level,employment and raw materialinventories declining at aslower rate; new ordersdeclining at a faster rate;supplier delivery timeimproving at a slower rate”.

The non manufacturing PMIalso reveals, “Businessactivity and new ordersdeclining at a slower rate;employment level and rawmaterials Inventoriesdeclining at a faster rate.

The PMI is based on thesurvey of purchasing andsupply executives ofmanufacturing and non-manufacturing organizationsin 13 locations in Nigeria. Thesurvey result is used tocompute the monthlyPurchasing Managers’ Index

Slowdown in GDP persisted infirst quarter — CBN reportStories byBABAJIDE KOMOLAFE

(PMI).The PMI report for March

stated, “The ManufacturingPMI improved marginally to45.9 per cent in March 2016,compared to 45.5 per cent inthe preceding month. Thisimplies that themanufacturing sector declinedat a slower rate during thereview period. Of the sixteenmanufacturing sub-sectors,twelve reported decline in the

review month in the followingorder: transportationequipment; furniture &related products; plastics &rubber products; textile,apparel, leather & footwear;printing & related supportactivities; nonmetallic mineralproducts; paper products;fabricated metal products;primary metal; computer &electronic products;appliances & components and

Sterling Bank Plc has saidit will empower 1,250

Medium, Small and MicroEnterprises, MSMEs in thisyear’s edition of MSMEAcademy workshop.Speaking at a pressconference to unveil theinitiative in Lagos, Unit Head,MSME Banking, Propositionand Products, OmolaraAkinfolarin said the workshopis slated to hold at fivedifferent locations acrossNigeria.These include: Port Harcourt,in April, Kaduna in May andOnitsha by July.Other cities include: Ibadanand Lagos in September andOctober respectively.At least 250 participants areexpected to be trained at eachlocation.She disclosed that the capacitybuilding which will featuretrainings on taxation,customer service, digitalmarketing, and other businesssupport services, will alsofeature a mini trade exhibitionat the end of each workshopfor participating SMEs toshowcase their products and

Sterling bank to empower MSMEs toboost job creation

services.Also speaking at theconference, ExecutiveDirector, Sterling Bank,Abubakar Suleiman said thecapacity building initiative forMSMEs was inspired by theneed to tackle unemploymentby supporting SMEs to createmore jobs.He said: “SMEs is afoundation for employment.We have this impression thatgovernment can createemployment. Sometimes wealso have the wrongimpression that the bigcorporations can also highermore people. But in reality,even the biggest corporationsin Nigeria does not hire up to50,000 people. So it is verydifficult for a singleorganisation, especially largeones, to solve ourunemployment problems.And if you watch carefully, theunemployment problem isgetting worse. And thesolution is not going to comefrom government or any largeorganisation. The only waywe can solve thisunemployment problem iswhen millions of individualswho have small businessesacross the country who whenthe environment is positive

will begin to expand theirservices and hire morepeople; or those who will startnew businesses because theysee opportunities and seepositive environment.“Why are SMEs notgenerating as muchemployment as we like. Thechallenge is simply that thetask of an entrepreneur whenyou start up today, in mostcountries where things arefunctional, you can focus onyour core area. But in acountry where a lot of theinfrastructure, the regulatoryprocesses and even basicthings as administrativeprocesses are very complex,it becomes very difficult for anSME to succeed. Because notonly do you have to be goodat what you think you aredoing but also other things.For instance, if you are a shoemaker, you have to beexcellent at shoe making aswell as distribution,procurement, administrativeprocesses, taxation and somany other areas that yousuddenly have to be an expertin order to keep that businesstogether.”He added: “Our ambition isto create SMEs that find away round these problems.

BY JONAH NWOKPOKU

Vanguard, MONDAY, APRIL 4, 2016 — 23

24 — Vanguard, MONDAY, APRIL 4, 2016

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Corporate Finance

Shareholders in thenation’s capital

market have decried poorreturn-on-investment from

Shareholders seek better returns frominsurance sector ...task NAICOM on policy changes

insurance companies andcalled on the NationalInsurance Commission(NAICOM) to implementchanges that will guarantythem better returns.

They also decried low levelinsurance penetration in the

country and its contribution tothe Gross Domestic Product(GDP), which is reflected inthe prices of the shares ofinsurance stocks listed on theNigerian Stock Exchange(NSE).

The shareholders under the

aegis of ProgressiveShareholders Association ofNigeria (PSAN) called onNAICOM to desist from over-regulating the sector, butrather focus on implementingaggressive expansionarypolicies that would increasethe sector’s penetration.

In a document titled:“Shareholders Concerns onGrowth and InsurancePenetration and its Regulationby NAICOM” signed by theassociation’s president, Mr.Boniface Okezie, they pointedout that the amendedcompany income tax act 2007is punitive to insurancecompanies, saying thatprovision for unexpired risks(Section14(8)(9) ‘andprovision for other reserves,claims and outgoings, section14(8)(b) are restricted.

Okezie said: “While weagree that sanity is required,it shall not be at the expenseof growth. The reality isgrowth comes at a risk. Thekey objective in regulation isto understand these risks andmanage them. It also meansdeveloping policies to allowinsurers to meet the needs ofvarious customer groups.

“We believe in effectiveenforcement policies, policiesto stop rate-cutting, policies toallow various paymentfrequencies. For instance,monthly premium payment,stricter enforcement of the lawon no premium no cover forbrokers. NAICOM shouldstop the levying long termbusiness and look for otherways to generate healthyincome.” Declaring that theshareholders require return-on-investment andperformance, Okezie chargedthe new leadership ofNAICOM to change someridiculous rules that are notfriendly to the shareholders inthe industry.

Citing examples of some ofthe rules, he said: “Despite theinsignificance of profit beforetax (PBT) of insurancecompanies in comparison tothe banks, the minimum taxpayable by both is comparable.In reality, it shows lack ofunderstanding of insurancebusiness.

“The company income tax(CIT) limits unearnedpremium reserve. Claims paidare management expenses,all of which are reasonablyincurred in the insuranceordinary course of business.Therefore, insurancecompanies are penalizedwhen paying claims.Ordinarily, these expensesshould be considered as costof sales and treated asallowable expenses.”

Fidelity Bank to pay investorsN4.6bn dividends, earns N146.9bnFidelity Bank Plc has said

that its gross earnings forthe year ended December 31,2015 grew by 7.9 per cent toN146.9 billion from N136.1billion recorded in 2014financial year (FY).

Following this, the bank haspromised shareholders N4.6billion as dividend payout,amounting to16kobo per sharedividend thus maintaining atradition of consistentdividend pay-out for the pastsix years.

The audited financialstatements made available atthe Nigerian Stock Exchange(NSE), showed that te bankposted 0.8 per cent increase inprofit after tax from N13.8billion in 2014 to N13.9 billionduring the review perioddespite the nation’s harshoperating environmentcharacterised by regulatory andeconomic headwinds.

Whereas total equityincreased by 6.0 per cent toN183.5 billion from N173.1billion in 2014, net operatingincome stood at N83.9 billion,a moderate 12.5 percent risefrom N74.6 billion in 2014.

Commenting on the result,Chief Executive Officer,Fidelity Bank Plc, Nnamdi

Okonkwo, said the bank’s 2015full year performance reflectsthe disciplined execution of themanagement’s medium termstrategy and the resilience ofevolving business modelsdespite the extremelychallenging businessenvironment in 2015.

He explained that the bankimproved the earning capacity

of its balance sheet even in theface of decline in fee incomeprecipitated by a N10.0 billionreduction in its foreignexchange income.

“We continued to increaseyields on earning assets fasterthan the growth in fundingcosts which improved our NetInterest Margin (NIM) to 6.9per cent in 2015.”

Stories byNKIRUKA NNOROM

PRESS CONFERENCE - From left: Managing Director/CEO, Fidelity Bank Plc., Mr. NnamdiOkonkwo; Chief Executive Officer, Nigerian Export Promotion Council, NEPC, Segun Awolowoand Representative of the Dean, Lagos Business School, Dr. Frank Ojadi at a joint pressconference on Export Management Programme aimed primarily at enhancing export readinessof micro small and medium scale enterprises, MSMEs in Lagos.

First Bank of Nigeria Ltd,said it accounted for 45

percent of bills paymentservices on ATM in thenation’s banking industry asat December 2015.According to the bank as atDecember 2015, about 275,000bill payments were madethrough the bank’s AutomatedTeller Machines (ATMs)while the value of airtimepurchase on all its ATMs wasabout N3 billion. The billspayment option is one of thefeatures of FirstBank’s ATMs,which also have other uniquefunctional features whichinclude cash transfer, air-timetop-up, cash deposit amongothers.The bills payment option isthe non-cash transactionfeature on the ATM thatmakes it easier for customersto pay for bills such as CableTV subscription, post-paidphone bills, and pre- bookedairline tickets. Thesetransactions can be executedthrough the Quickteller optionon any of the bank’s ATMs.The Transfer feature enablescustomers to transfer moneyfrom their accounts to bothintra (within FirstBank) andinterbank (other banks)accounts, thereby reducingthe queues in the bankinghall, save time as well asprovide a more convenientoption for customers’ moneytransfer needs.To reach out to morecustomers and in line with itsstrategy to drive ease ofservice in banking, FirstBankis presently leading in theindustry as the bank with thehighest number of AutomatedTeller Machines (ATMs) withabout 2,700 ATMs deployedacross the country, making itthe nation’s financialinstitution with the widestretail footprint.The bank is also currentlyresponsible for over 40 percentof interbank transactions and27 percent of airtime vending.As active mobile networkusers in Nigeria are over 151million and the need torecharge is on the increase,the bank’s ATMs also providethe platform for easy top-up.To further enhanceconvenience, FirstBank’sATMs also operate the CashDeposit function which allowscustomers to deposit fundswithout customarily having toenter a banking hall for thistransaction.

Access Bank Plc hasannounced the appointment ofMr. Abba Mamman Tor Habibas non-executive director. Mr.Habib is a thorough bredbanking professional with 20years banking experience, 15 ofwhich were spent withGuaranty Trust Bank (GTB) Plcwhere he voluntarily retired in2008 as an executive director.His experience in GTB spannedacross Corporate Banking andRisk Management. Habib hassince 2008 been the ManagingDirector of Gremcoh ServicesLimited, his family ownedagriculture and real estateenterprise.

He holds a First ClassBachelor of Science degree in

Access Bank appoints TorHabib non-executive director

Agric Economics fromUniversity of Maiduguri (1986)and Master of Science inBanking and Finance fromBayero University Kano (1997).He has attended severalexecutive developmentprogrammes in leadinginstitutions including AfricanDevelopment Bank, Harvard,IMD, D.C Gardner London andInsead. His appointment issubject to the approval of theCentral Bank of Nigeria (CBN)and the bank’s shareholders.

Commenting on theappointment, Mrs. MosunBelo-Olusoga, chairman, AccessBank Plc said: “We are verydelighted to welcome Abba onthe Board of Access Bank.

FirstBankaccounts for45% ATMstransactions

Vanguard, MONDAY, APRIL 4, 2016 — 25

CMYK

Corporate Finance

Guaranty Trust Bank(GTB) Plc said it

is targeting profit beforetax of N125 billion for itsfull year ended December2016, and will also focuson the retail end of themarket to optimizereturns.

The bank also said ithopes to be the best-run-bank in the bankingindustry within the year,while maintaining a veryhigh standard ofcorporate governanceand compliance torelevant laws andpolicies.

Speaking at a forumwith business editors inLagos, the GroupManaging Director/CEO, Mr. Segun Agbaje,said the bank would focuson growing small andmedium enterprises(SME) business bylowering cost of fundsand maintaining margin.

He stated that GTB willalso focus on increasingthe contribution of itssubsidiaries to Group’sPBT and optimizingrevenue as well asminimizing cost of itssubsidiaries.

“We will grow risk assetsof our institutionalbanking business andnon-performing loans(NPL) below of below fivepercent,” he said, addingthat the bank wouldleverage technological

GTB targets N125bn PBT in 2016,to focus on retail customersStories byNKIRUKA NNOROM

advancement to keep costlow.

Reviewing 2015 fullyear financial result, theGTB boss said the bankachieved best in classshareholders return andasset deployment aspost-tax Return onaverage Equity (ROaE)and Return on averageAsset (ROaA) closed at25.6 per cent and 4.1 percent respectively, addingthat subsidiaries’contribution to the profitbefore tax (PBT) closed at6.9 per cent versus 7.2per cent in FY 2014.

Also, the bank recordedgross earnings of N301.9billion, representing 8.4per cent increase from

N278.5 billion recorded inthe previous year.

The bank’s profit beforetax (PBT) and profit aftertax (PAT) rose by 3.7 percent and 5.3 per centrespectively. While thePBT rose to N120.7 billionfrom N116.4 billion, PATmoved from N94.4 billionin full year 2014 to N99.4billion in the reviewperiod.

The balance sheet resultshowed that GTB grew itstotal assets by 7.2 per centfrom N2.36 trillion toN2.52 trillion. Loans andadvances to customersstood at N1.37 trillion asagainst N1.28 trillionposted in the previousperiod in 2014.

Nigerian AviationH a n d l i n g

Company Plc, (NAHCoAviance) has increased itsrevenue by five per centfor the 2015 financial yeargrossing N8.5 billion asagainst N8.1 billiondeclared for the 2014financial year.

The results released tothe Nigerian StockExchange, (NSE),showed that the companyweathered theunfavourable operatingenvironment to post aresult which analystsdescribed asencouraging. The resultsshowed that profit before

NAHCo grosses N8.5bn,proposes N324.8m dividends

tax rose to N796.8 millionas opposed to N769.5million recorded in 2014period.

The company, on thebasis of this result, isproposing a dividend ofN324.8million to itsshareholders, an increaseof N29.5 million over theN295.31million paid in2014.

The Chief FinancialOfficer (CFO), Mr.Bamidele Adelaja, saidthe 2015 politicaltransitional programme,the reduction in cargovolumes, the increasinginflationary trend,unfavourable dollarexchange rate forimporters, unsteadypower supply andsecurity challengescontributed in no smallway to the low margin.

He disclosed that thecompany also investedthe sum of N2 billion onre-fleeting of groundsupport equipment(GSEs) andcommissioned itswarehouse in Enugu,Enugu State during theperiod.

“Although thecombined effect of theseinvestment activities hasimpacted on profitabilityin the short term,forecasts for the future isprojected to show astrong positive inearnings and dividendpayout,” Adelaja said.

The company continuesto nurture its investmentin Nahco Free Trade Zonewhich is showingimproved signs ofbusiness activities even asit continually scout formore opportunities in adiversifying economy.

Oando Plc said it expectsa decline in earnings andprofitability in its auditedfinancial results for theyear ended December 31,2015.

This is even as thecompany explained thatits failure to file the 2015audited financial reportsand accounts latest byMarch 31, 2016 asstipulated by the NigerianStock Exchange (NSE)post listing rulesrequirement was due to itsinability to complete theaudit of the accounts ontime.

The company said in astatement that theexpected decline was as aresult of ‘industry;sdownturn, prevalenteconomic headwinds, aswell as fiscal andmonetary restrictionsdriven by a challengingmacro environment.

Oando expects lower earnings,profitability for 2015

On delayed release ofthe financial results.Oando said: “We haveworked diligently with ourexternal auditor, Ernst &Young (“EY”) to ensure aswift conclusion to theaudit process. However,after reviewing thefinancials, EY indicatedthat the Aacounts maylikely need to be referredto the Financial ReportingCouncil of Nigeria(“FRC”) pursuant to Rule5 of the recently publicisedFRC Rules.

“We expect the processto be concluded on orbefore 31 May, 2016,however this is dependenton the completion of theexternal review process asreferred to above.”

Oando, however,assured that it is activelyrestructuring its businessto adapt to the difficultperiod.

26 — Vanguard, MONDAY, APRIL 4, 2016

BY ETOP EKANEM

Organisers of the maiden edition of the fire safetyconference by the National Fire Protection Association

West Africa, NFPAWA, scheduled for April 18 to 21, 2016 inLagos, have reiterated its importance in view of fire disastersand building collapses currently being experienced acrossthe country.

Roland Ngong, vice president of the organising committeeand technical director with Safety Consultants and SolutionProviders, told Vanguard that the modules to be treated duringthe training and conference will greatly benefit safetyprofessionals and building engineers, as well as risk managersand insurers. “Risk insurers are the ones who bear the cost ofbuilding collapse and fire incidents. It is important for themto know what and what are needed in a building duringconstruction and after before they can accept to underwritesuch building. The reason is that in case of any eventuality,they carry the can,” he said.

Ngong said there were at least five modules to be taught atthe conference. These include Life Safety Code and Meansof Egress which he said would be taken by Tracey Bellamy,who has more than 25 years experience in the fire protectioncommunity, including all areas of the fire sprinkler industry.According to Ngong, Bellamy also has extensive experience

Eliminatingstresswhenbuyingproperty

In this economy, beingstressed out has become

a fixture in everyday life andselling or buying a propertymight add to the list ofthings that try to break us.While you have little or nocontrol over how the entireselling or buying processpans out, the good news isthat you have the power tocontrol how you react to it.

Be prepared to deal withissues head on when theyarise by following a fewsimple steps:

Choose your agentcarefully: An experiencedprofessional will beprepared for any sort ofoutcome in the selling orbuying process, putting theinterest of the buyer and theseller before personal gain,because they know it’s a win-win situation when theirclients are happy with thetransaction.

Be prepared: Keep thingsin perspective and be sureto map out a plan of best andworst case scenarios beforestarting the buying or sellingprocess. For home buyers,this could mean creating alist of your ‘wants’ and‘needs’ of property featuresbefore scheduling a viewing.This way, you know when tosettle and where to draw theline. For sellers, let youragent know the lowestpossible offer you are willingto accept at the start of theprocess, shield yourselffrom un-serious buyersfrom the get-go. Also, letyour agent know the idealvalue you expect and whatwould make the rest of theyear completely blissful foryou.

Be realistic: It isespecially important to berealistic about what youhope to achieve from yourreal estate goals, talk themover with your agent and besure they are achievablewithin the parameters ofyour budget, geographicallocation etc.

Home buyers, getmortgage preapproval:Having your finances readyeliminates the heart-clenching waiting periods orsurprises from lenders afteryou’ve found your dreamproperty.

Source: Lamudi Nigeria

Housing finance: AfDB injects $8.2minto Shelter Afrique

Shelter Afrique hasreceived $8.2 million

injection of equity from theAfrican Development Bank(AfDB). Shelter Afrique is apan-African financeinstitution which exclusivelysupports the development ofhousing and real estatesector in the continent.

In a statement, AfDB saidthe injection is meant tostrengthen its balance sheetand help achieve itsobjective of providingquality affordable housing inAfrica. It further highlightedthe confidence the bank hasin the future of the continentand the implications forhousing development in thecontinent.

“Africa’s economiclandscape remains positivewith promising scope for

growth; Gross DomesticProduct remains robustsupported by multiplefactors. The continent’sgrowing population, agrowing middle class and thefastest urbanisation rate inthe world are some of thefactors driving increaseddemand for affordablehouses and housing finance,”AfDB noted.

Managing Director of

Shelter Afrique, Mr. JamesMugerwa, noted that theequity increase is a reflectionof the confidence reposed byAfDB in his firm. “The AfricanDevelopment Bank has sentstrong signals about theseriousness of housing onthe continent, and byextension, the seriousness ofwhat we do here at ShelterAfrique. It is a welcomedevelopment but we see it as

The continent’s growingpopulation and a growingmiddle class are some of thefactors driving increaseddemand for affordable housesand housing finance

enge as well. This equityincrease means the AfDBwants to see more, they wantto see impact and scale andthat is what we will be aimingfor this year; impact,” hesaid.

AfDB stated that theinvestment is well aligned toits ten year strategy for theperiod 2013-2022, as well asone of the bank’s highstrategic priorities of“improving the lives of peoplein Africa”.

With the increase in equity,AfDB - a Class B shareholder- has become the largestshareholder in theorganisation, making thehousing financier anunofficial subsidiary of thebank. Shelter Afrique isowned by 44 AfricanSovereign shareholderscategorized as Class Ashareholders. The Class Bshareholders are the AfricanDevelopment Bank and theAfrica RE organisation.

Builders, stakeholders counselled on fire safety confabwith fire suppression system design, fire hazard analysisand fire protection system inspection and testing, and he islicensed as a Professional Engineer in 49 states in the US,District of Columbia and Guam, and a Certified FireProtection Specialist (CFPS).

“This course provides an overview of the latesttechnologies, design approaches, and challenges as itrelates to the means of egress and life safety requirementsfor facilities in conformity with the NFPA 101(2015 Edition),Life Safety Code. It will provide the tools needed toconfidently apply or enforce requirements of the Life SafetyCode. Topics that will be covered will include classificationof construction and occupancy type, determining occupant load and egress capacity, requirements for protection ofvertical openings and hazardous areas, and determiningrequirements for building services and fire protectionfeatures.” Ngong stated. Other modules, according toNgong, include: National Fire Alarm & Signalling Code,which is based on the fire alarm, detection and emergencynotification system requirements contained in NFPA 72,2016 Edition, National Fire Alarm and Signalling Code and;NFPA 13 which deals with Automatic Fire Sprinkler Systems,this will be based on the fire sprinkler system requirementscontained in NFPA 13 2016 Edition Standard for theInstallation of Sprinkler Systems.

•Estate development in Abuja

Homes &Housing Finance

STORIES BY YINKAKOLAWOLE

Vanguard, MONDAY, APRIL 4, 2016 — 27

CMYK

MMA2 seeking NCAA approval to begin regionaloperations, says Bi-Courtney

By LAWANI MIKAIRU

Bi-Courtney AviationServices Limited(BASL), operator of the

Murtala Muhammed AirportTwo (MMA2),weekend said itis still awaiting regulatoryapproval from the NigerianCivil Aviation Authority (NCAA)before commencing operations,despite obtaining authorisationfrom the Federal AirportsAuthority of Nigeria (FAAN) tocommence regional operationsat MMA2 as set out in theconcession agreement betweenthe two.

This is contrary to claims insome quarters that insufficientspace for parking aircrafts wasdelaying the commencement ofinternational operations at itsterminal. BASL in a statementsaid the delay in obtainingNCAA’s approval has nothingto do with the size of its apronor any other operational issue.

It further explained thatvarious teams of inspectorsfrom NCAA and other statutoryagencies, including theDepartment of State Security(DSS), Nigerian ImmigrationService (NIS), National DrugLaw Enforcement Agency(NDLEA), Nigerian CustomsService (NCS) and the PortHealth Service supervised itspreparation for the internationaloperations to ensure that itcomplied with all therequirements.

Adding that all theseagencies have also deployedtheir personnel at the terminalin readiness for thecommencement of international

operations, while the interiorministry had already accordedMMA2 the status of an entrypoint into the country.

The statement reads: “Wedon’t have any issue withparking space for aircrafts. Thatis a false allegation. TheFederal Airports Authority ofNigeria (FAAN) has given usthe authorisation to commenceregional operations, but we stillneed other approvals from theNigerian Civil AviationAuthority (NCAA). And wehave complied with all therequirements set by NCAA.

These areas cover safety,security and operations audit.We have invested huge sum forthe commencement of theregional operations for the pastsix months. We have signed theagreement with FAAN since lastyear.”

Also reacting to the reportedplans by an airline to move itsoperations from the terminal tothe General Aviation Terminal,which is being run by FAAN,due to purported high chargesat MMA2, the company deniedthat any airline was planningto relocate from its terminal.

The company also explainedthat its current passengerprocessing fee was approvedby the Federal Governmentand that it does not have theauthority to increase its chargesarbitrarily.

It further stated: “It should benoted that we only charge forpassengers processing. Andthere has not been anyincrement in the charges in thelast four years, despite theserious devaluation in thevalue of the naira and thepeculiar nature of our facilities,which requires paying theirmaintenance cost in foreigncurrency.”

By LAWANI MIKAIRU& DANIEL ETEGHE

The president ofInternationalCivil Aviation

Organisation, ICAO, DrBernard Aliu has stressed theneed for aviation agencies inthe country to imbibe theculture of development ofhuman capacity building.

Speaking while addressingunion members from AirTransport Services Senior StaffAssociation of Nigeria andNational Union of AirTransport Employees NUATEand heads of aviationparastatals in Abuja, Dr Aliusaid there was need forconstant training of personelas technology was evolving.

According to Dr Aliu, withall the facilities andnavigational aids in placewithout a trained workforce,there will be no development

ICAO President charges aviation agencies on capacity buildingstressing that human capacitydevelopment must be the keyword. “Training, training,training is the word in aviationand new technology must behandled by trained personnelin order to remain inbusiness”.

The ICAO Presidentexplained that with doubletraffic projection in Passengerand aircraft movements in2030 globally, there was needto strengthen security andsafety across the globe addingthat the industry must beready for the growth.

Dr Aliu warned that“doubling of traffic andpassengers movement shouldnot be doubling of accidents.”

The ICAO President assuredNigerians that the country’saviation will not be left behindadding that every open itemwill be closed for better results.

He commended the unionsfor the industrial harmony

existing between them andmanagement of parastatalssaying it will fosterdevelopment of the industry.

Earlier, the president of AirTransport Services Senior StaffAssociation of NigeriaATSSSAN, Comrade BenjaminOkewu said it was pride and

honour to have a Nigerian asthe president of ICAO. Heexplained that with Dr Aliu’sposition, Nigeria has beenrightly placed in the Worldmap adding that he has beencollaborating with them at theInternational TransportFederation ITF.

FAAN seeks partnership with investors

By LAWANI MIKAIRU & DANIEL ETGHE

The Federal Airports Authority of Nigeria, FAAN,weekend said it is willing to partner with genuineprivate investors towards a mutually beneficial

relationship.The Managing Director of the Authority, Engr Saleh Dunoma

made the disclosure at the ongoing Airport Business Summitin Abuja, where he made a presentation on the topic “TerminalExpansion: key to maintaining high standards of operationalefficiency and improved airport users experience”.

Engr Dunoma, who was represented by the Authority’s ActingDirector of Commercial and Business Development, Mr ToyinOkpaise said the sector is therefore strategic in the FederalGovernment’s quest to diversify the economy and create wealthand prosperity for the teeming populace.

SAHCOLpromises tosupportMedviewAirlines withground handlingequipment

Acting ManagingDirector of Skyway

Aviation Handling CompanyLimited (SAHCOL), Mr.Rizwan Kadri has said thatthe company will continue tosupport Medview Airlineswith the best ground handlingservices to support theAirline’s unique selling pointof on-time departures.

Disclosing this developmentwhile congratulatingMedview Airlines for its newroutes and expansions Mr.Kadri affirmed that there hasbeen a long lastingrelationship between bothcompanies as SAHCOL ismore of a business partner toMedview Airlines.

He stressed that SAHCOL isa major provider of AviationGround Handling Services inNigeria adding that offeringservices in PassengerHandling, Ramp Handling,Cargo Handling andWarehousing, Aviationsecurity, BaggageReconciliation, Crew Bus,Executive Lounge, and otherrelated Ground Handlingservices.

The Managing Director ofMedview Airlines, AlhajiMuneer Bankole whilewelcoming the Ag. ManagingDirector and his team,reminded them that theMedview Airlines’ uniqueselling point is ‘on-timedepartures’, which he believesSAHCOL is key in makingpossible.

Alh. Bankole recalled thatthe relationship betweenSAHCOL and MedviewAirlines started in November,2012. SAHCOL, according tohim has come a long way inthe making of the success storyof Medview, such that they nolonger see SAHCOL as partof its service providers but aspartners.

The visit which gave theActing Managing Director ofSAHCOL an opportunity tomeet with the ManagingDirector of Medview Airlinesfor the first time in an officialcapacity, also broughtManagement teams from bothsides together in a relaxedatmosphere, while issues ofmutual interest wereprogressively discussed.

PRESS CONFERENCE - From left Tolu Odukale, Associate Director, Risk Consulting; NikeOyewolu, , Head, Sales and Markets; Olumide Olayinka, Partner and Head, Risk Consultingand Tomi Adepoju, Partner, Risk Consulting, all of KPMG during the press conference andlaunch of KPMG survey report on “The Top Ten Business Risks for 2016” held in Lagos. PhotoLamidi Bamidele

Aviation

28 — Vanguard, MONDAY, APRIL 4, 2016

Microfinance

“Buhari says power crisis no laughing matter, targets 10,000MW.”PUNCH, March 22, 2016, p 2.

In the report by Olalekan Adedayo, President Buhari said, “Nigerians favouritetalking point and butt of jokes is the power situation in our country. But, ladiesand gentlemen, it is no (longer) laughing matter. We must, and by the grace of

God, we will put things right. In the three tears left to this administration, we have given ourselves the target of

Economic Summit: Elephant goesinto labour, delivers a mouse (1)

10,000MW distributablepower. In 2016 alone, weintend to add 2,000MW to thenational grid.”

Thus on Monday, March21, 2016, PresidentMuhammadu Buhari openedthe much awaited economicretreat which was widelybelieved to be be convenedto chart a new economiccourse for the country. Inmany respects, it was adisappointment. For anadministration which waselected on the CHANGEmantra, very little haschanged. In many respects,what the retreat finallydecided could be describedas “the same stale stew,warmed up, and served innew plates.” (apologies toBabangida). The place tostart is Buhari’s statement atthe opening of the retreat.

On the whole, what theretreat announced asdecisions, were at the sametime original and good but oflittle practical value. Whatwas original was not good;what was good was notoriginal. So let us examinethem one by one.

Perhaps because the AllProgressives Congress,APC, was not sure of winningthe 2015 elections, the partynever had a blue print foreconomic development. Eventhe village idiot now knowsthat. They are now justfloundering around trying tocobble together a set of

economic policies; but,without mutually agreedideological basis.

When Buhari announcedthe 10,000MW target for2019, he probably did notrealize that he would be thethird President since 1999 tomake the promise. Thatmakes the statement good,but not original.Furthermore, the 10,000MWtarget had been used twicebefore to defraud Nigeria byhis predecessors in office.Below is a brief summary ofour recent history withpresidential promise of10,000MW which was neverdelivered.

In 2003, PresidentObasanjo, who does notknow his left from right,appointed Engineer LyelImoke as Minister for Power,who promised to deliver10,000MW by 2007. It was onthe basis of that fraudulentclaim that $13-16 billion,according to late PresidentYar’Adua, was raided fromseveral accounts, invariablywithout the approval of theNational Assembly, NASS, forObasanjo’s phantom powerproject. History had alreadyrecorded that Obasanjo andImoke squandered ourresources and left the nation

with less than 3,000MW. In 2008, late President

Yar’Adua announced that hewas going to declare aPOWER EMERGENCY.Nothing happened more thanthree months after –prompting me to publish anarticle on these pages titledPOWER EMERGENCYALREADT DECLARED inJuly 2008. Shortly after that,Mrs Diezani Alison-Madueke, then Minister ofTransport, under Yar ’Aduaannounced that thegovernment had concludedplans to increase powersupply to, you guessed it,10,000MW soon. Yar ’Aduapassed on leaving us withabout 3,800MW – which wasnot even consistent.

For sheer authority lying,it would be difficult to beat theJonathan administrationwhich followed. In addition tothe President himself, he hadseveral high-poweredprofessional dissemblers toassist in making promisesabout power supply whichwere never delivered. Amongthe eminent people were:President Jonathan, the VicePresident (Sambo), twoMinisters of Power (ProfessorsNnaji and Nebo), Minister ofState for Finance (Yerima

Lawal Ngama), Minister ofInformation (Maku) and themedia owns Senior Adviser(Abati). The lies they toldNigerians about powersupply can fill a book. But,just for the record, let usrecall a few.

President Jonathanlaunched a ROAD MAP TOPOWER project in 2012promising to increase powersupply to 14,300MW byDecember 2013. Today we arestill battling with under-3000MW power supply. Vice-President Sambo weighed inthe following yearannouncing 20,000MW to bemade available soon.Professors Nnaji and Nebopromised twice each to takeus to the 10,000MW levelbetween 2011 and 2015.Nothing of sort happened.

Then it was the turn of thespin doctors to assure us thatall was well. Former Ministerof Information, LabaranMaku once told aninternational audience thatNigerians enjoyed 18 hourspower supply. Jonathanmade the same claim in aninterview with ChristianahAnnanpour of CNN wholooked at our formerpresident with disdain as hespoke. Finally, our own dear

Reuben Abati, in his rejoinderto the query by Dr Ezekweziliabout the $43 billion left inExcess Crude which hadvanished, started with a gem.According to Reuben,Jonathan met the powersupply at 2000MW (it wasuntrue) and brought it to4,500MW (only for one day)and he thought Nigeriansshould be grateful for thatachievement. In reality,Jonathan added less than1000MW to the regular powersupply in his five years inoffice. But, Abati was notabout to allow facts to get inthe way of propaganda.

We have dwelt at lengthover power because Buharihas bottomed the Economicagenda on power supply andto remind the President andFellow Nigerians that wehave heard those promisesbefore. And, as if todemonstrate that nothing haschanged, the Minister ofState for Power, underBuhari, Mustapha Shehuriannounced that the Federalgovernment had set a newtarget of 20,000MW by theyear 2020. Here we go again.The President said 10,000MWby 2019 and his Ministerannounced 20,000MW a yearafter. In any case 2019 is onlythree years away and 2020 amere four years. Do theyactually expect us to believethis? And, if not whatbecomes of the rest of theeconomic programme?

The Rotary Club of Isolohas empowered about

20 persons with tools andequipment to further enhancelocal output and encourageentrepreneurship amongpeople living within Isolocommunity, commissioning aone block of two classroomsat the Isolo ComprehensiveSenior High School, Alabe.

The empowerment project ispart of the club’s CorporateSocial Responsibility (CSR)initiative to give back to itsresident community. Some ofthe items given includes:Sewing Machine; GrindingMachine; Hair DressingEquipments, Gas Cooker,Baking instruments;Carpentry tools, amongothers.

Speaking at theCommissioning ceremony inLagos, Senator GaniyuSolomon, said that individualsand corporate Nigerians cantake cue from rotary, saying,“In fulfillment of service andeconomic development

Empowerment: Rotary donates to needy,commissions classroom

Stories ByPROVIDENCE OBUH

programme which is the visionin rotary, rotary club isdonating a block of twoclassrooms to the school andalso empowering theindigenous Isolo communityall in the name of givingselfless service to the people,

but there are various serviceareas, this is just one of them,community and economicdevelopment.

“Government cannot do italone, it is important to invitewell meaning Nigerians toparticipate, whether corporate

Nigerians or individual toassist, take a cue from rotary,anybody can do it, this is whywe commend Parent TeacherAssociation (PTA) for theireffort in assisting the children.There is no country that is selfsufficient that can do

everything all alone.In the same vein, President

Rotary Club of Isolo, Mrs.Lolade Ogungbe, added thatthe government should bemore focused on schools inNigeria by building modelschools that looks like privateschools with a view todiscouraging the influx ofmushroom schools.

According to Ogungbe, “Inrotary we believe in service toour community and one of theavenues of service to thecommunity is basic educationand literacy and in line withthat basic education andliteracy and communitydevelopment project, we got aletter from this school about ayear ago, asking us to providethem two additional blocks ofclassroom.

“This will enable the schoolto qualify for West AfricanExamination Council (WAEC)centre, they don’t have a hallso their school do not hostWAEC, so it will be of immensebenefit to the school,” she said.

Deputy Executive Secretaryof Isolo LCDA, Elder SamuelOgunlolu, commended thegesture describing it asloudable. “When you provideinfrastructure you areproviding and adding valuebecause you are bringing upthe leaders of tomorrow,Ogunlolu said.

Djibouti’s has announced plans to fosterstronger trade ties with partners across

the continent, including Nigeria with a viewto encouraging economic integration andenhanced connectivity between Eastern andWestern Africa.

This is contained in a report produced bythe global publishing, research andconsultancy firm, Oxford Business Group(OBG). The Report: “Djibouti 2016” looks atthe country’s strategy for growth, such ascarving a niche as a regional logistical platform,port expansion and developing an air cargobusiness that could serve Nigeria and otherAfrican countries are among the projectsconsidered.

The publication also explores Djibouti’s driveto leverage its strategically advantageousposition on one of the world’ busiest shippinglanes by boosting trading activity with bothlandlocked East-African countries and otherinternational players farther afield.

Djibouti plans to foster stronger trade ties with NigeriaThe Report charts the country’s impressive

growth story, which has been fuelled by risingFDI on the back of an improved investmentclimate, in particular, the young nation’s majorinfrastructure drive, which includes $14 billionworth of construction and development acrossthe transport sector.

CEO/Editor-in-Chief, OBG, Mr. AndrewJeffreys, said that a research undertaken bythe group’s team showed that rising levels offoreign investment were producing a positiveimpact across the economy.

“Djibouti’s macroeconomic stability andenhanced business environment have helpedto make it an attractive destination for investors,with positive ripple effects evident in keysectors, such as construction. Our first-timereport on Djibouti indicates an economy in themidst of countrywide infrastructural activitywhich is also making strides in developing tieswith neighbours and global economic powersfor future prosperity,” he said.

Vanguard, MONDAY, APRIL 4, 2016 — 29

CMYK

e-Commerce

PRESS CONFERENCE - From Left: Dr Oluwole Akinyeye,Head of Maritime Unit,Olisa Ag-bakoba Legal[OAL] Mrs Priscilla Ogwemoh,Managing Partner Arbitration & ADR;Mrs Ola-bisi Akodu,Head of Corporate/Commercial public sector group at the press conference onDriving the Maritime RoadMap in a Dwindling Economy Organized By Olisa AgbakobaLegal[OAL] in Ikoyi Lagos. PHOTO:AKEEM SALAU.

as Consulting which receivedthe second largest share.However by December thisfigure had fallen to 33.08 percent, due to a fall of 63,513 inthe number of applications. Thisrepresents a fall of 52.97percent, and accounts for 42.98 percent of the total fall. TheConsulting industry saw acomparatively modest drop of37.11per cent, however, giventhat this industry accounted for12.13per cent of the total numberof applications over the period,this still accounted for 8.50percent of the total decline inapplications.”

It however added that the thirdlargest industry over the period,ICT/Telecommunications, whichreceived 5.91% per cent ofapplications over the period sawapplications decline by 51.13 percent between October andNovember, slightly more thanaverage.

The survey further noted thatPower/Energy and Travel/Tourism were the industries toreceive the most applications pereach vacancy, receiving 461 and366 respectively, which makesthem the most competitiveindustries to apply for on theJobberman website.

It also found that activeapplicants were predominantlymale, 67.77 per cent and welleducated, with 77.61 per centbeing educated to degree levelor higher.

The survey also highlightedtrends in remuneration offeredby employers where it foundthat of vacancies by salaryadvertised over the six monthsto December, there were only 159active vacancies for which salaryinformation was available. Ofthese, the average salary was N127,264 per month. Howevergiven that this figure representsa small number of vacancies, itis heavily influenced by a fewoutliers.

This is demonstrated bycomparing the average to themedian, which is only N 60,000,less than half the average. Thehighest salary advertised was N2,400,000 for an Insurance jobin Lagos, but there were threeother jobs also above N1,000,000. These were for aConsulting and an Oil & Gas/Mining job in Lagos, eachadvertising N 1,500,000, and anICT/Telecommunications job inAbuja advertising N 1,000,000.Of the 159 vacancies with salaryinformation, 123 were located inLagos, and only 36 were locatedoutside. Those within Lagoscommanded a higher salary onaverage, N 132,764 compared toN 108,472. In addition, themedian was slightly higherwithin Lagos, indicating that thisisn’t necessarily just a result ofthe outliers mentioned above.

Apathy hits online jobs as patronagesuffers 46% decline

Stories byJONAH NWOKPOKU

The latest survey byNigeria Bureau of

Statistics in partnership withJobberman on employmenttrends in Nigeria, has shown asharp fall in the demand for jobsposted online within the lastquarter of 2015.

According to the survey, therewas a notable decline in thenumber of applications receivedon the Jobberman website, froma peak of 318,233 in October,which was slightly higher than

the 313,694 received inSeptember, to 69,886 inNovember, and then by a further77,894 in December, when thenumber of applications was170,453. This decline in thenumber of applicationsrepresents a 46.44 per cent droprelative to the peak number ofapplications in October.

The survey found that the fallin the number of applicationswas broad based affecting morethan 70 per cent of the industriescovered.

It noted that, “Out of the 27different industries, 23 receivedless applications during the

review period. Four industriesdid not experience any declinein the number of applications.These industries wereConstruction, Power/Energy,Food services and others, buttogether these industriesaccounted for only 4.66 per centof applications over the periodas a whole. The industry toreceive the most applications ineach month was Trade/Services,which accounted for 36.02 percent of applications over thethree month period. In October,the industry received 119,900, or37.68per cent of applications,more than three times as many

A new public opinion poll by NOIPollshas revealed that e-commerce continues

to grow significantly with more Nigerians,about 53 per cent, now aware of onlineshopping.

The polls revealed a relatively high level ofawareness on e-commerce in Nigeria, as about5 in 10 Nigerians showed awareness of onlineshopping, and of this proportion, 25 percentfurther indicated that they shop online or knowsomeone who does. These findings suggest thatwhile online shopping only started gainingpopularity in Nigeria in recent years due to thespringing up of indigenous online shoppingsites, its awareness and usage is relativelyencouraging.

More findings from the poll revealedNigeria’s premiere online retailer, Jumia.comas the top online shopping platform in Nigeriain terms of popularity, about 68 per cent, andusage, 58 per cent; this is followed by ‘Konga’ with 59 per cent popularity and 30 per centusage. Other marketplace sites withconsiderable popularity include ‘OLX’, 18 percent and ‘Kaymu’, 7 per cent, amongst otheronline retail shopping platforms. It is importantto note that the indigenous online shoppingsites such as Jumia, Konga etc. which have

New survey shows deepeninge-commerce penetration in Nigeria

sprung up in the last few years seemed to havegained more popularity and usage than foreignonline shopping sites such as Amazon, Aliexpress etc. This may be likely due to factorssuch as proximity, currency of dealing, deliverytime and terms of payment of the both categoriesof sites in view. For instance while theindigenous sites offer services like payment ondelivery (heightening the assurance ofcustomers), foreign sites do not offer this serviceas payments need to be made before delivery.In addition, Nigerians consider ‘convenience’ (46 percent) ‘quality’ (16 percent), ‘variety ofproducts’ (10 percent) ‘delivery time’ (6 percent)as the most important factors that influencetheir decision to shop online.

The poll’s assessment of the online shoppingexperiences of respondents revealed that mostNigerians, 61 per cent, who shop online aresatisfied with their online retail shoppingexperience, although a considerable proportionof respondents in this category respondednegatively. This is no surprise given the fact thatthe satisfaction level of consumers is bound todiffer due to the several online shoppingplatforms available in the country and thevarying expectations of individual consumersfrom these platforms.

8 MEA countries topMasterCard-CrescentRating Global MuslimTravel Index

Eight countries from theMiddle East & Africa

(MEA) region have rankedamong the top ten destinationsin the global Muslim travelmarket, according to the mostcomprehensive researchfocusing on this fast-growingsector.

The MasterCard-CrescentRating Global Muslim TravelIndex (GMTI) 2016, whichcovers 130 destinations, saw theUAE moving up one spot tosecond place on the list ofOrganisation of IslamicCooperation (OIC)destinations, with five out of theother six Gulf CooperationCouncil (GCC) states,including Qatar, Saudi Arabia,Oman and Bahrain, also beingplaced among the top tendestinations. Malaysia retainedits number one position on thelist. South Africa has taken thefourth spot while Singapore hasretained its pole position for thenon-OIC destinations, withThailand, United Kingdom andHong Kong making up the topfive.

Mobile device maker,Infinix Mobility will

today unveil its latestsmartphone ‘Infinix HOT 3’with the aim to give Nigeriansthe best mobile experience.Infinix mobility is Africa’strendy smartphone brand withover 5 smartphone seriessuccessfully launched indifferent markets in thecontinent.In a statement, the devicemaker said: “Technologycontinues to evolve andINFINIX is one of the brandsmaking history with mobiletechnology change in this partof the world. The brandcontinues to ensure customershave access to top-notchspecifications at affordableprices, adding that, “InfinixHOT 3 is the most anticipatedsmartphone yet to be releasedfirst quarter in Nigeria. Thesmartphone launches with thelatest technology standardsfor premium smartphones in asleek & light sizedsmartphone.” Speaking on thenew device, Nigeria Countrymanager of Infinix Mobility,Bruno Li said: “We are excitedto be part of the brandschanging the face of mobileusage in Nigeria with oursmartphone collections. WithInfinix HOT 3, we wantconsumers to see their phonesas more than just a gadget butas an essential part of theireveryday life with features thatrepresent this. Our aim is toupgrade our consumer’slifestyle with technology in theprocess of makingInfinix ahousehold name in Nigeriaand other parts of Africa.”

Infinix Mobilitylaunches ‘HOT 3’today

CMYK

30 — Vanguard, MONDAY, APRIL 4, 2016

Background:With a background in

microbiology, Dr BraimohBello has been practisingEpidemiology and PublicHealth in the past 10 years. “Istarted off with health andmedical research but I havebeen able to apply my skillsin other aspects of research,including education andpsychology,” he said.

Research can benefit society:Health is wealth says an old

adage. Bello believes that adisease-ravaged populationcannot grow the economy. Hesaid: "I am involved in aproject in Zambia beingexecuted by the PopulationCouncil of America (PCA) withfunds from the UKDepartment for Foreign andInternational Development(DFID) to find out if aparticular humandevelopment program canhelp teenage girls in terms oftheir reproductive and sexualhealth. PCA provides thisintervention with differentcomponents. One componentis a social skills training. Theygot mentors for about 10,000girls over a period of two tofour years. The mentors trainthe girls every Saturday onreproductive/sexual health lifeskills so the girls get to knowwhat menstruation, sex,pregnancy, and sexuallytransmitted infections are inareas in Zambia whereteenage pregnancy rates arevery high and there is alsohigh HIV infection rate as wellas Herpes Simplex Virus. Sothe PCA, through thisprogram, is trying to reduceall of these things. Such aprogram is very expensive somany donors like the WorldBank, UN, etc., do not justsponsor the program, theybuild a research component toit to see if the program works,what we call ImpactEvaluation or Value forMoney. They measure andestimate the size of thatimpact on society.

Research component:"They got a team of experts

from different parts of theworld as external evaluators.So Mott MacDonald, aninternational consultancy firmin London, was contracted.The firm put together fourpeople – two researchers fromLondon, myself and anotherperson from Zambia. We go toZambia and carry out scientificprocesses and document withthe PCA the impact of theprogram. If the program isimpactful, we then begin to

Knowledge fromresearch can turnbusinesses arounddiscuss sustainability planwith the PCA, to say this kindof program can solve yourHIV problem or your teenagepregnancy problem. It is nowtime for the government totake over. So the research isdone in discussion withgovernment. It is the duty ofresearchers to carrygovernment along so thatgovernment can translateresearch findings into policy."

Varsity/private sector gap:Lecturers should collaboratewith the private sector to bringmoney to their universitiesand close the gap so that theprivate organisations can alsolearn from them.

It is hard to be a fee-payingPhD student in South Africa.Your supervisor will almostalways have sponsorships foryou to pay the fees and evenpay you monthly stipendbecause they write proposalsto private organisations to getfunding. Example,researchers could check if aparticular microorganism canprovide a particular antibioticor check the antimicrobialproperties of bitter leaf inpartnership with a privatepharmaceutical company whowill take up the results of theresearch.

As you translate research topractice, you are closing the

gap as whatever you find goesstraight to the industry.

The government should besponsoring research. Weblacks can be very emotionaland illogical sometimes.When they tell you there is awhite man who has Ebola andhe is being given Ebola drug,you say it is racism. The Ebolamedication was testedoverseas, the antiserum wasextracted overseas, the moneywas American money. Theseorganisations are willing topay to train their people. Theyinvest millions and billions ofdollars into research butNigeria has not been able totell us what is happeningwith sickle cell anaemia. Along time ago, we heard aboutdifferent medicinal plants thathave anti-sickling properties.

If all you dedicate your lifeto is materials that have anti-sickling properties, it is okay.It is not difficult to tell thesickling rate or the sicklingfrequency of the cells andthen from in vitro, we can goin vivo. We can start talkingabout safety trials, efficacytrials and then we take it fromthere and see if we can havea drug that can be licensed.So government should besponsoring research, whetherit is health, environment,water, construction orwhatever, we need people tounderstand the value ofresearch and it will create alot of jobs. If I tell you howmuch jobs we can create inNigeria by bridging the gapbetween academic researchand practice, you will notbelieve.

Research funding:There are different aspects

of research - food, water,health, social issues,environmental issues etc.,and government has to comein. South Africa is a research-intensive country. I wascontracted by theirDepartment of EnvironmentalAffairs to provide training on

statistics to the staff. I askedthem what they do, one ofthem said asenvironmentalists, they areresponsible for removingalien plants. It was a newbody of knowledge for me.They said the amount of wateravailable to the countrydepends on the amount ofwater in the aquifers whichcan be depleted by alienplants that do not contributeanything to the vegetativequality of the country. Theymap out areas with alienplants and measure thevolume and quality of waterin that area before and after.So they are able to say this isthe amount of water we needfor the whole country, this isthe amount of water we have,this is the amount of water wecan add if we remove ouralien plants. These people arenot in private organisations,they are in a governmentministry! Governmentministries in Nigeria shouldbe doing this type of research,using science to better theirwork. They paid a lot for usto provide the three-daytraining. We have haddiscussions with agovernment ministry inNigeria to provide exactly thesame training and they saidthey could not afford it.

Invest in capacity-building:

Dr Braimoh Bello is a senior medicalscientist/research technical leaderat the Johannesburg-based Centre

for Statistical Analysis and Research (CESAR). Heis also an honorary lecturer at the University ofthe Witwatersrand and President of BeyondTomorrow. Braimoh who was in Nigeria recently,spoke to Financial Vanguard on various issues andthe need to pay more attention to research andinnovation. Excerpts:

BY EBELE ORAKPO

It is the duty ofresearchers tocarry governmentalong in the workthat they do sothat governmentcan translateresearch findingsinto policy

•Dr Braimoh Bello... You will not believe how much jobswe can create in Nigeria by bridging the gap betweenacademic research and practice.

People in Business

To build capacity, you haveto invest. We need people whohave insight, who can thinkand make technical decisionson behalf of theirdepartments, ministry andcountry. We need financialresources, we need to bewilling to spend if we want tocapacitate the employed andthose we are still going toemploy because training is anongoing process and anygovernment department thatwants to be relevant in the21

st Century has to make

training a top priority.Ministries should be

opened up to privateorganisations, consultantsand universities. Corruptionis a big problem. If I say it willcost $10,000 to train your staffand you inflate the budget by30 per cent, then the numberof people you can train in ayear is significantly reduced.So management of the smallresources we have is one ofthe biggest issues in thecountry.

It doesn’t matter how muchyou have in revenue, ifcorruption is the order of theday, you will not achieveanything. Even if you budgetto have a training coursemonthly, but at the end of theday, you may only have onein a year and all that moneygoes into somebody’s pocket.

It is common saying that“Give a man a fish and

you feed him for a day; teacha man to fish and you feedhim for a lifetime.” In thislight, Rullion CapacityBuilders, Vocational SkillsTrainers, has held her10th Send-Forth Ceremonyfor participants of its skillsacquisition programme.

The three-week intensiveprogramme, included cakebaking & decoration, eventsplanning/management &decoration, Spa training(nails, facials, body massageetc), slippers, sandals & bagmaking (with Ankara andother materials), Accessoriesmaking, as well asPhotography. Speaking at theevent, Mrs. OluwatoyinEgedi, Coordinator, RullionCapacity Builders, praisedthe participants for taking abold step in guaranteeingtheir future. She encouragedthem to take whatever theyhad learned further byenrolling for certificate anddiploma programmes or evenby doing more research &study online.

She spoke on the need forempowerment of theNigerian youths and women,emphasising the need toacquire skills and create jobsfor oneself rather than waitingfor the elusive white collarjobs as entrepreneurship isthe future of any developingeconomy such as ours.

Rullion graduatesstudents

Vanguard, MONDAY, APRIL 4, 2016 — 31

Economy

The latest report form a n u f a c t u r i n gPurchasing Managers’

Index, PMI, compiled byFBNQuest Research, an armof FBN Merchant BankLimited, has indicated arecovery from 50.6 in Februaryto 54.4 for the month of March2016.Manufacturing PMI tracksoperating environment offactories within a givenperiod, usually one month,with information based on theresponses of manufacturers toset questions on core variablesin their businesses.The five variables measuredinclude output, employment,new orders, suppliers’delivery times and stocks ofpurchasesAccording to the researchreport only employment, oneof the five sub-indices, wasnegative in March. Thestrongest reading was 61 foroutput, up from 53 recordedin February.

“We link the marked recoveryin the output sub-index from53 in February in part to asmaller improvement forstocks of purchases”.Even at that it appeared thatlarge sized manufacturers arestill in difficulties as thefavourable index was recordedamong small and mediumscale organisations.“It was limited to smalland medium-sizedcompanies. For the large andmore import dependent firms,there was actually a decreasein March”, the report stated.Moreover, the analysts atFBNQuest said that access toforeign exchange did notimprove in the month undersurvey, a situation which hadbeen prevalent in the past sixPMI reports.“In these circumstances, wewould expect companies toturn to local inputs, whereavailable. Small firms wouldnormally take the lead in thisprocess, given their greaterflexibility in production”, thereport stated.

According to FBNQuestanalysts “the fact that theemployment sub-index wasbelow water for the fourthsuccessive month tells us thatrespondents do not see abright near term.“They have pushed upproduction because other

Manufacturing Index may shownegative trend reversal

Stories By EmekaAnaeto, Economy Editor

factors allowed it but are notrushing to increase theirpayrolls”.

National accounts for fourthquarter 2015 showed thatmanufacturing expandedmarginally by 0.4 per centyear-on-year, compared withthe contraction of -1.8 percent year-on-year in thirdquarter.“We caution that the firstquarter tends to be theweakest for growth in theyear, not least because ofdelays in the release of fundsfrom the budget for capitalspending.“The agenda of the currentadministration is driven byits expansionary budget for2016, which the Senate lastweek approved”.FBNQuest PMI is the first ofsuch index in Nigeria, butthe National Bureau of

Statistics, NBS, has also takenup research on manufacturersPMI.The index is a familiar data

release at the start of thecalendar month in developedmarkets such as the UnitedStates of America with theInstitute of SupplyManagement, ISM, issuingits lead PMI, world’s oldestand most popular PMI.FBNQuest PMI is modelledafter the ISM. Therespondents are askedwhether output, employment,new orders, suppliers’delivery times and stocks ofpurchases have improved onthe previous month, areunchanged or have declined.They are asked to makeallowances for seasonalfactors. A reading of 50 isconsidered neutral.Since it was launched in April2013, FBNQuest PMI haveposted just three negativereadings, specifically in July2013, May 2015 and January2016).

The first quartertends to be theweakest forgrowth in theyear, not leastbecause of delaysin the release offunds from thebudget for capitalspending

Mixed developments in price movementsIf price movements in the international

commodities market is anything to go byinflation rate may have remained up-tick in themonth of March.More often price directions in the internationalmarkets influences Nigeria’s CompositeConsumer Price Index, CCPI, the headliner ofthe inflation rate.Cocoa prices went up 0.13 per cent toUSD2,974 per metric tonne on concerns thatdry weather will threaten to shrink crop yieldin top growing countries.Sugar futures was also up 0.06 per cent atUSD0.1587/pound, because major Asian cropgrowers expect production to falter this yearon El-Nino induced droughts.Brent crude was up 0.31 per cent at market’smonth average of USD39.26 per barrel, WestTexas Intermediary, WTI, futures went downsignificantly by 2.44 per cent to month’s marketaverage price of USD38.32 per barrel.The price dynamics was influenced by the lowerthan anticipated increase in U.S crudeinventories.On the heels of the mixed crude pricemovements LNG price went up by 4.74 per centdue to colder weather in the North East andMidwest of the United States.

But the U.S Dollar weakened on the dovishstance of the Federal Reserve Bank and theinverse relationship between the dollar andcommodity prices will continue.However, there were also significant pricedeclines in some of the key commodities,signalling a moderating impact.Wheat futures went down 2.67 per cent toUSD4.64/bushel as a robust worldinventories weigh on wheat prices, despiteweather concerns.Similarly corn prices went down by 1.61 percent to USD3.67/bushel as China set to endhuge corn stockpiling scheme, a decisionslowed imports.On the outlook of international commodityprices a negative sentiment for oil isanticipated until April 17 meeting ofmembers of the Organisation of PetroleumExporting Countries, OPEC.In the summer, lower demand for heatingoil but higher demand for gasoline areexpected while Middle East tension is lowand prices expected to stay tepid.Grain futures will be mainly US dollardependent in the next few days as traderswill focus attention to US data release ofspring planting for next cues.

In line with its resolve toensure and exceed

customer satisfaction, UnionBank Nigeria Plc hasunveiled two more improvedbranches in Lagos with new technology and superiorproduct offerings. The new branches, Itire Road, Lawanson branch and Western Avenue branch,both located in Surulere, Lagos, showcased improvedtechnology and superior product offerings aimed atmaking banking moreaccessible, simpler andsmarter to customers andprospects of the bank. Speaking at the event, theTransformation Director,Union Bank, Mr JoeMbulu, said the essence ofthe transformation was toshow how far the bank caresfor its customers, adding thatthe transformation of the bankbegan two years ago. “For us in Union Bank, ourtransformation is different, inthat, it has more depth andmore substance. What we’redoing today is just acelebration of what we commenced two years ago. “ “Basically, we have lookedat the technology; we have anew core banking application,our data centre is new, wehave a back-up that is live,and there are not many banksthat can tell you that, whenthey have failure, theircurrent data can switch over.We can do that seamlessly.“And we have transformedthe way our people engagethe customers. Our customerservice is different andtestimonials today attest tothat point. So, we have lookedat the culture of the bank also;we used to be known as anold people’s bank, but I canchallenge any customer outthere today to come to UnionBank, they will be awed bythe service,” the bank Directorassured.According to Mbulu, UnionBank now has products thataddress customers ‘needs.Furthermore, he said thebank’s governancestructure has improvedsignificantly, saying thatpresently at Union Bankthings are done faster andmore efficiently. “So, there is a new culture,a new bank, a new way ofdoing banking which issimple and smarter,” headded.

Union Bankunveilsbranches withimprovedtechnology

32 — Vanguard, MONDAY, APRIL 4, 2016

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

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

(0805 220 1997)

Business & Economy

CMYK

The African UnionCommission said that

blocking illicit financial outflowfrom Africa and repatriating thefunds were important infinancing the SustainableDevelopment Goals on thecontinent. The AUCommissioner for EconomicAffairs, Dr Anthony Maruping,said this at a news conferenceat the ninth joint AnnualMeeting of the AU SpecialisedTechnical Committee forMinisters of Finance andEconomic Planning.

The conference was organisedby the AU in collaboration with

Blocking illicit financial outflow, surestway to financing SDGs

the United Nations EconomicCommission for Africa(UNECA).

The theme of the conferenceis: “Towards an integrated andcoherent approach toimplementation, monitoringand evaluation of Agenda 20163and the SDGs.”

NAN also recalls that Agenda2063 is a 20-goal Action Planfor all segments of Africansociety to work together to builda prosperous and united Africabased on shared values anddestiny. The SDGs have 17goals that follow and expand onthe achievements of the

Millennium DevelopmentGoals (MDGs).

It is expected to be achievedby 2030.

Maruping said that thecommision had estimated thatabout 246 billion dollars wasrequired to half poverty andinequality in Africa, yet thecontinent loses an estimated 50billion dollars annually to illicitfinancial flows. He stressed thecommission’s stand to block thisand use it to finance criticaldevelopment projects thatfurthered the eradication ofpoverty and inequality inAfrica.

This column has consistentlymaintained that the root

cause of our economic paradoxof increasing income, withunbridled rate ofunemployment, and deepeningpoverty will be found in theconscious but incorrect adoptionof a faulty and distortionalprocess for the infusion of ourcrude export dollar revenue intothe economy.

Hereafter, we will discuss therelated ADVERSEconsequences of the CurrentPayments Model (CPM) againstthe positive attributes of theAdvocated Payments Model(APM) for the allocation, forexample, of $1bn export revenuein the following explanatorysteps.

Thus, in CPM: -1 The CBNunilaterally determines thenaira exchange rate andthereafter unconstitutionallycaptures the distributable $1bnrevenue and prints/creates inreplacement (read asmonetizes) N200bn as statutoryallocations, which are thendomiciled in the bank accountsof beneficiaries.

CPM:-2 If CBN’s mandatorycash reserve ratio for banks is,for example 10%, the N200bninflow can be leveraged ten-fold,to create additional creditand expand consumer spendingpower which will invariably fuelinflation! The recentestablishment of the TreasurySingle Account will, regrettably,only temporarily absorb anycash injection, as the N200bnallocation, for example, willultimately migrate into privatesector bank accounts toinvariably expand Nairaliquidity, credit availability andconsumer demand once MDAspay salaries and settleoutstanding contractors’ bills.

CPM:-3 In response toevolving inflationary threats, the

Sensible path to stronger Naira,economic prosperity

same CBN, ironically,‘altruistically’ sells treasury billsand borrows money it does notneed, often, at over 10 percent,just to reduce the challenges ofsystemic excess Naira andexcessive consumer demand!Inexplicably, however, despitethe crying need of the real sectorfor cheap funds, thsese CBNborrowings are simply kept assterile funds.

CPM:-4 Since such liberalaccess to subsisting excesscheap funds, fuel inflation withadverse economic and socialconsequences, the CBN wouldrespond by raising its MonetaryPolicy (Control) Rate (MPR) toforce banks to also significantlyincrease their own lending rates,so that higher cost of fundswould discourage borrowers,and inadvertently also reduceany prospect of industrial growthor the creation of increasing jobopportunities.

Thus, CBN is actuallyvicariously liable for the veryhigh cost of funds that cripplethe real sector.

CPM:-5 Meanwhile,Ministries and StateGovernments, who requireimports to improve theirinfrastructure, becomeconstrained to buy back theirdollars from banks, who havebecome the prime beneficiariesof CBN’s auctions at a higherregulated rate. Ultimately, nairaexchange rate would comeunder threat as increasinglysurplus naira is unleashed byCBN to chase the dollar rationsit regularly auctions.Consequently, the marketdynamics of demand and supplybecome unfavourably skewedagainst the naira.

CPM:-6 The less dollars soldby CBN, the larger would beCBN’s purported reserves, butthe weaker also will inexplicablybe the naira, as less and less

dollars compete against theexcess naira earlier unleashedby CBN. Ultimately, the gapbetween official and blackmarket naira rates willincreasingly widen.

CPM:-7 To reduce the gapbetween the parallel marketand official exchange rates, theCBN commits the unforced errorof allocating dollars to Bureaude change who in turn fund therequirements of treasury lootersand smugglers of contrabands,not minding the adverse impactof such misguided dollarallocation on the economy(thankfully the CBN terminatedthis obnoxious strategy of officialdollar sales to BDCs in January2016).

CPM:-8 The CBN, ironicallycontinues to maintain itsmonopoly of the forex marketand sits on bountiful naira anddollar reserves, while debtaccumulation persists and thebanks celebrate another bumperharvest.

Conversely the AdvocatedPayments Model would operateas follows.

APM:-1 $1bn distributablegovernment revenue is not

substituted with N200bnallocation; instead, constitutionalbeneficiaries receive dollarcertificates equal to theirrespective allocations, while theactual $1bn remains domiciledwith CBN, and the nairaexchange rate is converselydetermined by competitive freemarket forces of demand andsupply.

APM:-2 With strictly dollarallocations, the $1bn incomedoes not translate to additionalnaira injection into the system;consequently, naira supplyremains the same, and cannottherefore further instigate theusual disenabling systemicspectre of surplus cash to fuelinflation.

APM:-3 Without systemic nairasurplus, CBN has no need tomop up liquidity by borrowingmoney it does not need, oftenwith interest rates above 10%;consequently, our N12tn ($60bn)oppresive debt and servicecharges would become reduced;additionally, reducedgovernment borrowing, wouldalso force commercial banks tochase the real sector forbusiness!

APM:-4 Futhermore, In theabsence of the usual excessnaira supply, CBN would reduceits Monetary Policy (control)Rate to international bestpractice below 3%; commercialbanks will also correspondinglydrop lending rates to single digitto attract borrowers.

APM:-5 The MDA dollarbeneficiaries can exchange fornaira, all or portions of theirdollar allocations from time totime, directly throughCOMMERCIAL banks. Thus,in the absence of the usual nairasurge when CBN substitutesfresh naira supply for dollarrevenue, the market dynamicswill consequently change infavour of the naira, with

relatively more dollar supplychasing EXISTING NAIRABALANCES. A stronger Nairawill reduce production cost andalso bring down fuel prices andmake subsidy totallyunnecessary; furthermore, a10% sales tax on cheaper petroland kerosene could alsoconsolidate over N1000bnannually into the nationalTreasury.

APM:-6 CBN’s erstwhilemonopoly of dollar supply andthe usual regular dollar auctionswill cease, as the constitutionalbeneficiaries directly trade theirdollar certificates for existingnaira balances with banks beforespending, (as the dollar is notlegal tender in Nigeria).Nonetheless, the dollars, willhowever remain domiciled withCBN, irrespective of the ultimatebuyer, until the apex bankreceives appropriate instructionfrom respective banks to directlypay the overseas suppliers ofgoods/services to theircustomers, from the dollarbalances the banks earlierpurchased from MDAs.

APM:-7 With the relativecontinuous dollar surplus andabsence of excess Nairaliquidity; the naira wouldconsequently gradually becomeperceived as a safer store ofvalue. Furthermore, the blackmarket for the dollar will rapidlycontract with little motivation forround tripping, capital flight andspeculative dollar purchases.

APM:-8 Optimal Nairaliquidity will invariablyprecipitate lower CBN MPR,and therefore promote lowersingle digit interest rate as wellas inflation below 3%, withpositive knock-on impact onconsumer demand, industrialconsolidation as well asincreasing job opportunities,with bourgeoning economicprosperity. A stronger naira willsimilarly drive down fuel pricesand ultimately eliminateoppressive subsidies of aboutN2tn in favour of a petrol saletax revenue in excess of N1Tnannually.

Clearly our fate as a nation isnot in our stars, but obviouslyin the choices we make!

With strictlydollarallocations,the $1bnincome doesnot translateto additionalnairainjectioninto thesystem