BusinessDay 24 May 2017

Wednesday 24 May 2017
UBA to launch $500m...
Continued from page 4
UBA said it will obtain the approval
of the CBN to access the official
foreign exchange market, if for
any reason the bank does not have
sufficient foreign currency reserves
to meet the principal and interest
payments due on the notes.
Based on Fitch’s assessment on
expected recoveries in a liquidation
scenario, an expected Recovery
Rating (RR) of ‘RR4 (EXP)’ is
also assigned to the notes, implying
average recovery prospects.
The notes will constitute senior
unsecured obligations of UBA and
will be used for general corporate
purposes.
Fitch said the assignment of
the final rating is contingent on
the receipt of final documents
conforming to the information
received to date. The expected rating
is in line with UBA’s Long-Term
Foreign-Currency Issuer Default
Rating (IDR) of ‘B’. In Fitch’s view,
the likelihood of default on these
notes reflects the likelihood of
default of the bank.
According to Fitch’s criteria,
a bank’s IDR usually expresses
Fitch’s opinion on the risk of default
on senior obligations to thirdparty,
non-government creditors
as in Fitch’s view, these are typically
the obligations whose nonperformance
would best reflect the
uncured failure of the entity.
Where a bank has a Long-Term
IDR of ‘B+’ or below, Fitch usually
assigns an RR to the entity’s issues.
RRs provide greater transparency
on the recoveries component of
Fitch’s assessment of the credit
risk of low-rated issuer’s securities.
“A change in UBA’s IDR would
affect the rating of the notes and
may also affect recovery prospects
and the RR. UBA’s IDRs are driven
by the bank’s standalone financial
profile, as reflected in its Viability
Rating (VR) of ‘b’. UBA’s VR and
IDRs are primarily sensitive to
further asset-quality deterioration
and capital deterioration as well
as continued pressure on foreigncurrency
funding and liquidity,”
Fitch Ratings stated.
Importers to save N1trn annually on 24-hour...
Continued from page 1
two to seven days in Cotonou;
Durban port, South Africa and
Mombassa port.
“In Nigerian ports, an importer
of a 20-foot container is expected
to get five days demurrage free and
to pay daily charges of N2,850 for
6-10 days; N4,400 for 11-24 days
and N6,600 for 25 days and above.
Acting President Osinbajo on May
19 signed, a new ‘Executive Order
on Promotion of Transparency and
Efficiency in the Business Environment,’
directing the Nigeria Customs
Service (NCS), Nigerian Ports Authority
(NPA), terminal operators and
other government agencies involved
in cargo clearance at the nation’s
seaports to begin round-the-clock
operations at the port within 30 days.
“Currently, the marine and ship
side of port operations, carried out
by the terminal operators have
been taking place 24 hours, seven
days a week, without interruption
in most terminals in Lagos ports.
This means that ships bringing
cargoes are being attended to any
time and day, including public
holidays and weekends. However,
cargo clearance and examination
by Customs and other agencies do
FG says new executive orders will be...
Continued from page 4
C002D5556
L-R: Raji Afolagbe, national president of Government High School old students association; Raliat Abdul-Razaq, wife of the
founder and first School Administrator; Alimi Abdul-Razaq, eldest child of the founder, and Saka Isau, former Secretary to
the Government of Kwara State and old student, during the reception hosted by the family of Abdulganiyu Abdul-Razaq,
founder of Ilorin College, now Government High School, Ilorin, to mark the 50th anniversary of the school.
not take place at night, weekends
and public holidays,” said Lucky
Amiwero, a maritime analyst, in a
telephone interview.
According to Amiwero, only a
few terminals allow agents to take
delivery of already cleared consignments
but 24-hour port operation
can only have impact on cargo
clearance, ‘if all the government
agencies at the ports, including
commercial banks that would
collect import duties and clearing
agents, are encouraged to work
round-the-clock and every day.
“The situation where banks operate
from 8am to 4pm everyday,
would not allow the importers and
their agents to pay import duty and
obtain necessary clearance that
would enable Customs to release
the cargo. It is not enough to issue
an executive order on paper, the
Federal Government needs to put
structures on ground to ensure
round-the-clock power supply at
the ports, as well as illuminate the
ports and environs.
“As we speak now, the access
roads leading to the ports in Lagos
are in a sorry state and the question
is, how would our ports operate
24-hours in such a state?”.
servants who will be in charge of
the implementation. To ensure that
the orders
work, we want to change the
orientation of Nigerians,” Akande
said, adding that Nigerians need
to understand that it is the duty of
everyone to ensure the improvement
of the Nigerian business
environment.
The newly signed executive
order calls for transparency in Ministries,
Departments and Agencies
(MDAs) of the Federal Government
of Nigeria. It also deals with
government agencies budgeting
and expenditure procedures, a
new visa regime that reviews entry
experience of visitors and travellers,
as well as port operations that under
the order will now run for 24 hours.
Meanwhile, more than one
month after the sack of the Director-
General of the National Pension’s
Commission (PenCom), Chinelo
Anohu-Amazu and appointment of
a replacement, Dikko Aliyu Abdulrahman
and his subsequent rejection
by the Senate, the government
is yet to pick a replacement.
Presidential Spokesman, Femi
Adesina told newsmen at the
briefing that the matter is still being
looked into, describing it as a
developing story.
“It is a developing story and it is
being looked at. No name has been
transmitted to the Senate for now
and that tells you the matter is still
being looked at”.
On April 13, President Muhammadu
Buhari fired heads of 22
parastatals, including Pencom,
and announced Abdulrahman
as the new director-general of
Pencom, subject to the Senate’s
confirmation.
The President also appointed
Funso Doherty as chairman of
Pencom Board, as well as Akin Akinwale,
Abubakar Zaki Magawata,
Ben Oviosun and Nyerere Ayim as
executive commissioners.
The appointment of the new
PenCOm DG is a breach of the provisions
of the Pension Reform Act,
2014 that provides that the nominee
for the position of the chairman
or director-general of Pencom
cannot be a shareholder or staff of
any Pension Fund Administrator
(PFA), within three years before or
after his or her appointment.
Section 21 (2) of the Act also states
that in the event of a vacancy (for the
chairman, DG or other members of
board), the President shall appoint a
replacement from the geo-political
zone of the immediate past member
that vacated the office to complete
the remaining tenure.
According to the Pensions Act,
the Commission’s DG is entitled to
five years tenure of office, subject
to renewal for another term in office.
The sacked DG was appointed
in 2014 even though she was in
charge of the agency in acting capacity
from December 2012.
Abdulraham, the nominated
DG, is from the North-West geopolitical
zone, while the former
DG is from Anambra State, South
East Nigeria.
The sacked PenCom DG was
reputed to have increased pension
assets from N2.9 trillion in 2012 to
N6.7 trillion in 2017 and the Retirement
Savings Account from N5.39
million to N7.2 million.
Amiwero also observed that there
are too many agencies at the ports
and for “24-hour port operation to
achieve its aim, the government
needs to prune down the number of
agencies at the ports because many
of them duplicate functions.”
Tony Anakebe, managing director
of Gold-Link Investment Limited,
also agreed that round-theclock
port operations will reduce
demurrage charges importers pay
to shipping companies and storage
charges paid as rent to terminal operators
for delayed cargo clearance.
Anakebe however said that “If
24-hour operation must work, the
government must improve on the
security system within and around
the port by ensuring that port access
roads are well illuminated and
that security cameras are installed
to monitor movement of persons
and cargoes in and out of the ports.
Security officials such as men of
the Nigerian Police Force and others
must be on ground to monitor
activities around the ports,” he said.
Anakebe, who noted that the
efforts of the past administration of
Good-Luck Jonathan to introduce
24-hour port operations, as directed
by Ngozi Okonjo-Iweala, then minister
of finance failed due to poor
infrastructure around the port area.
He further observed that government
must ensure that port access
roads are in good shape to ensure
free flow of traffic day and night.
“The past administration did
not have the political will to implement
the 24-hour port operation
and the government also did not
put pressure on agencies and other
operators involved, so as to ensure
that the ports operate round-theclock,
in line with the international
best practices.”
Jonathan Nicole, President
Shippers’ Association of Lagos,
who commended the government
for the new order, said that if well
implemented, it would reduce the
time spent in clearing goods from
21 days to two days, and further
help in reducing the cost of doing
business at the ports.
“Customs officers and all other
operators that now work from 9am
to 5pm are expected to be on seat
regularly to attend to importers
and their agents, and they can
achieve this by running 12-hour
shifts on a daily basis.
“If the Federal Government succeeds
in implementing the 24-hour
port operations, Nigerian seaports
would become user-friendly and
more efficient, reducing the dwell
time of cargo and ensuring faster
turnaround time for ships calling
at the ports,” Nicole added.
BUSINESS DAY
33
NEWS
Briefs
Trump’s $4.1tr budget takes hatchet to safety net
The White House has unveiled
a $4.1tr (£3.1tr) budget
that would take the axe to the
social safety net for the poor.
The plan would sharply slash
food stamps, healthcare for
low-income patients, disability
benefits and eliminate student
loan subsidies.
The budget also features an
Ivanka Trump plan for paid parental
leave.
Government borrowing at three-year April high
Government borrowing was
at its highest April level for three
years, according to the latest figures
from the Office for National
Statistics (ONS).
Public sector net borrowing,
excluding public sector banks,
was £10.4bn last month, up by
£1.2bn from April 2016.
Public sector net debt was
£1.72tn, equivalent to 86% of
GDP, an increase of £114bn on
April 2016.
German police raid Daimler offices
German police have searched
11 offices of carmaker Daimler
as part of their investigation into
possible fraudulent emissions
data by employees.
A total of 23 prosecutors and
230 police officers took part in
the search in the states of Baden-
Wuerttemberg, Berlin, Lower
Saxony and Saxony,
Daimler, which owns Mercedes-Benz,
said it was cooperating
with authorities.
Housing recovery intact despite drop in new home sales
New U.S. single-family home
sales tumbled from near a 9-1/2-
year high in April, but the housing
recovery likely remains intact
amid a tightening labor market.
The Commerce Department
said on Tuesday new home
sales declined 11.4 percent to a
seasonally adjusted annual rate
of 569,00 units last month, with
sales in the West region plunging
to their lowest level in nearly
1-1/2 years.
U.S. plan to sell oil reserve shows declining import needs
President Donald Trump’s
proposal to sell half of the U.S.
strategic oil reserve highlights a
decline in the biggest oil user’s
reliance on imports - and a
weaning off OPEC crude - as its
domestic production soars.
The U.S. Strategic Petroleum
Reserve (SPR) SPR-STK-T-EIA,
the world’s largest, holds about
688 million barrels of crude in
heavily guarded underground
caverns in Louisiana and Texas.
Apple and Nokia see deeper partnership after ending patent dispute
Apple (AAPL.O) has settled
a patent dispute with Finnish
telecom equipment maker Nokia
and agreed to buy more of its
network products and services,
sending Nokia shares up 7 percent.
The deal means Nokia will get
bigger royalties from Apple for
using its mobile phone patents,
helping offset the impact of
waning demand for its mobile
network hardware.