BusinessDay 09 Apr 2018

usinessday market monitor 

Commodities 

Brent Oil 

$67.37 

Cocoa 

US $2,448.00 

NSE 

Biggest Gainer Biggest Loser 

Nestle 

Mobil 

N1385 0.36pc N170 -7.10pc 

40,841.14 

Bitcoin 

2,378,347.35 -1.10pc 

Powered by 

Everdon Bureau De Change 

$-N 

£-N 

€-N 

BUY SELL 

360.00 363.00 

496.00 505.00 

434.00 444.50 

FOREIGN EXCHANGE 

TREASURY BILLS 

Market Spot $/N 3M 6M 

I&E FX Window 360.01 0.00 -0.01 

CBN Official Rate 305.60 12.91 14.46 

FMDQ Close 

5 Years 

0.00% 

13.50% 

FGN BONDS 

10 Years 

0.00% 

13.64% 

20 Years 

0.00% 

13.56% 

NEWS YOU CAN TRUST I **MONDAY 09 APRIL 2018 I VOL. 15, NO 28 I N300 @ g 

Shebah Petroleum 

drags feet on $143m 

loan repayment 

... As London court 

throws out appeal 

LOLADE AKINMURELE 

Time is wearing thin for 

indigenous oil exploration 

and production company, 

Shebah, whose latest appeal of 

a $143 million lawsuit brought 

Continues on page 46 

BPE finalises plans 

to sell Yola , Afam 

Power firms 

... appoints FBN Quest Consortium 

as sole transaction adviser 

OSA VICTOR OBAYAGBONA 

The Bureau of Public Enterprises 

(BPE) has reiterated 

its resolve not to compromise 

on transparency and integ- 


Inside 

Stakeholders set for 

BusinessDay BUSINESS DAY 

Capital Market and 

Investors Forum P. 4 

BALA AUGIE 

An increase in selling 

prices across key 

products and the improving 

economic 

environment has 

helped bolster the margins of 

most listed consumer goods 

firms in the country. 

This means that these firms 

have been able to turn each Nai- 

L-R: Olayinka 

Oladiran (K’ola), 

presenter, MTV 

Base; Michille 

Andrade, COO, 

Workspace 

Nigeria; 

Omowunmi 

Martins, head, 

marketing and 

branding, 

Andersen Tax, 

Nigeria, and 

Mobola 

Akinkugbe, 

partner, 

Auctus Legal 

Firm, at the 

BusinessDay 

Millennial Hangout 

Women’s 

edition in Lagos. 

Pic by Olawale 

Amoo 

Consumer firms’ profit gains 

as price hike raises margins 

Nestle, Dangote Sugar see biggest margin expansion 

Stocks rally on improved profitability 

ra invested in sales in generating 

higher profit, which also signals 

improved efficiency as they 

turned more input into output. 

BusinessDay analysed data 

from the 2017 audited financial 

statements of 14 of the largest 

listed firms in the Nigerian 

Stock Exchange (NSE) consumer 

goods index. 

The index comprises the most 

capitalized and liquid companies 

in food, beverage and 

Continues on page 4

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BUSINESS DAY 

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Monday 09 April 2018

Monday 09 April 2018 C002D5556 BUSINESS DAY 

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4 BUSINESS DAY 

C002D5556 

Monday 09 April 2018 

NEWS 

Stakeholders set for BusinessDay 

Capital Market and Investors Forum 

IHEANYI NWACHUKWU 

Consumer firms’... 

Continued from page 1 

tobacco. 

The firms are Unilever Nigeria 

Plc, Cadbury Nigeria Plc, Vitafoam 

Nigeria Plc, Nestle Nigeria 

Plc, Flour Mills Nigeria Plc, Nigerian 

Breweries Plc, Guinness 

Nigeria Plc, International Breweries 

Plc, Honeywell Nigeria 

Plc, PZ Cussons Plc, Champion 

Breweries Plc, Dangote Sugar 

Nigeria Plc, Dangote Flour Plc, 

and Nascon Allied Nigeria Plc. 

Net profit margins (the 

percentage of revenue left 

after all expenses have been 

deducted from sales), for the 

firms on a cumulative basis 

increased to 7.65 percent in 

December 2017 from 4.57 percent 

the previous year. 

This compares with a 3.7 

basis point drop in margins 

year on year between 2015 and 

2016, periods during which they 

grappled with a severe dollar 

scarcity that hindered imports 

of raw materials to meet production 

while the devaluation of 

the currency resulted in foreign 

exchange losses. 

“It’s the combination of the 

two things; improved liquidity 

and increases in key product 

price. It’s more of increases in 

the price of product to make up 

for slow sales volume as most of 

their products are inelastic,” said 

Ayodeji Ebo, managing director 

and CEO of Afrinvest Securities 

Limited. 

“The stability in foreign exchange 

in 2017 prevented most 

of these firms from booking foreign 

exchange losses,” said Ebo. 

The gross domestic product 

of Africa’s largest oil producer 

expanded for three straight 

quarters last year after a 1.6 percent 

contraction in 2016, with 

year-on-year growth reaching 

1.9 percent in the final three 

months of 2017. 

ers. At the Forum, investment and 

capital market industry operators 

will also proffer insights regarding 

the theme of the conference. 

Oscar Onyema, chief executive 

officer, Nigerian Stock Exchange 

will be the keynote speaker at the 

conference which holds on April 

26, 2018 at the prestigious Intercontinental 

Hotel, Lagos. 

Other speakers include: Patience 

Oniha, Director General, 

Debt Management Office (DMO); 

Bola Onadele. Koko, Managing 

Director and Chief Executive 

Officer, FMDQ OTC Securities 

Exchange; and Bola Ajomale, 

Managing Director and Chief 

Executive Officer, NASD OTC Plc. 

Aside the apex and Self-Regulatory 

Organisations (SROs), the 

conference also brings together 

capital market operators from various 

trade groups with the nation’s 

capital market, fund managers, 

and Pension Fund Administrators 

(PFAs). The conference is themed 

“Catalyzing listings in a thriving 

The Manufacturing Purchasing 

Managers’ Index (PMI) 

closed March at 56.7 index 

points as business activities in 

the country continued to grow, 

according to the a recent report 

by Central Bank of Nigeria 

(CBN). 

Drilling down into the numbers 

for consumer goods firms 

shows that 11 out of 14 firms saw 

their margins expand in 2017, 

according to data compiled by 

BusinessDay. 

By comparison only Champion 

Breweries Plc recorded net 

profit margin expansion for the 

2016 financial year. 

Nestle Nigeria Plc’s saw margins 

grow at the fastest pace 

among companies tracked by 

BusinessDay, with net profit 

The 2018 edition of BusinessDay 

annual Capital 

Market and Investors 

Forum will be another 

important gathering of 

personalities in the nation’s capital 

market who will be discussing 

how to catalyse listings in the nation’s 

thriving market. 

The event is an annual gathering 

of government officials, apex 

and self-regulatory organisations, 

all capital market operators, investment 

bankers, policy makers, 

chief executive officers (CEOs), 

economists, researchers, analysts, 

academics, private equity firms, 

technology startups and firms in 

need of long term capital. 

Currently, the strategic partners 

for the capital market and 

investors forum are the Nigerian 

Stock Exchange (NSE), 

FMDQ OTC Securities Exchange 

(FMDQ), NASD Plc, Zenith Capital, 

Nestle Nigeria Plc, among othmarket”. 

Oil is the big elephant in Nigeria’s 

capital market as the prices 

at circa $70 had their highest averages 

since 2014. International 

Monetary Fund (IMF) forecasts 

that Nigeria’s economy will grow 

by 1.9percent in 2018, driven by a 

stronger global economy; higher 

global oil prices and output; FX 

market stability; and fiscal stimulus 

Ȧmid all these expected positives, 

the dearth of new listings in 

equities, debts, derivatives, and 

Exchange Traded Funds (ETFs) 

as well as other alternative asset 

classes is increasingly attracting 

questions from many schools of 

thought. 

Nigeria joined the league of 

Argentina, Turkey, and Hong 

Kong stock markets which outperformed 

global equities in 

terms of returns in 2017. Truly, 

2017 was a great year for equity 

investors globally. In Nigeria, over 

N4.5trillion was gained by stock 


APC set to reverse 

tenure elongation for 

Oyegun Committee 

JAMES KWEN, Abuja 

The National Executive Council, 

NEC meeting of the ruling 

All Progressives Congress, 

APC holding today is set to make 

a u-turn on its earlier decision 

which extended the tenure of the 

John Odigie-Oyegun-led National 

Working Committee Members of 

the party for one year. 

The Council NEC had fixed 

Monday to take final decision on 

the tenure extension for the party’s 

executives’ after it constituted a 

10-member technical committee 

headed by Gov. Simon Dalung of 

Plateau to advise its leadership on 

how to move forward on the matter. 

This followed President Muhammadu 

Buhari´s recent opposition 

to NEC’s approval of tenure 

extension for the NWC and all executive 

committees of the party at 

all levels across the country, a decision 

he said was unconstitutional. 

Abdullahi Ganduje, Governor 


L-R: Segun Ajibola, president, Chartered Institute of Bankers of Nigeria (CIBN); Taiwo Adeoluwa, secretary to the Ogun State government; Godwin 

Emefiele, governor, Central Bank of Nigeria (CBN); Nnamdi Okonkwo, managing director/chief executive officer, Fidelity Bank plc, and Victor Osadolor, 

deputy group managing director, UBA plc, at the formal launch of the Guardian Compendium on “Financing The Economy” and the conferment of the 

Economic Personality of the Year Award on Emefiele in Lagos, at the weekend. 

investors last year. 

While most major markets 

posted sizable gains last year, the 

rising tide did not lift all boats 

around new listings. The market 

is expecting MTN Nigeria listing 

this second half (H2) which will 

be a big one. 

Onyema will be leveraging this 

conference to tell stakeholders 

further prospects or possible risks 

to attracting new listings. 

Corporate institutions have 

continued to successfully tap the 

Nigerian debt capital markets 

(DCM) to access stable long-term 

finance to fund key activities that 

ultimately translate to the development 

of the economy at large. 

Onadele. Koko is expected to 

leverage the forum to further inform 

stakeholders on how FMDQ 

OTC Exchange has positioned to 

bring revolutionary changes in the 

Nigerian DCM. 

Investors growing interest in un- 

margins almost tripling to 13.81 

percent in December 2017 from 

4.35 percent as at December 

2016. 

This is followed by Dangote 

Sugar Plc, the largest producer 

of the sweetener, which saw net 

profit margin more than double 

to 19.45 percent in December 

2017 from 8.49 percent the previous 

year. 

“As companies begin to recover, 

we’re seeing an increase in 

what they buy from us. Confectioneries, 

bakeries and beverage 

companies have increased their 

demand,” said Abdullahi Sule 

managing director and CEO of 

Dangote Sugar Refinery. 

Nascon Allied Nigeria Plc 

was efficient in translating top 

line impressive sales into bottom 

line growth (profit) as net 

margin moved to 19.74 percent 

in December 2017 from 13.20 

percent the previous year. 

The stock prices of some of 

the firms have been rallying in 

tandem with margin expansion 

or improved profitability. 

Dangote Sugar’s shares have 

gained 237.79 percent in the 

last four years to touch down 

at N21.45 percent as at 2:00 pm 

close of trading on Friday. 

Nascon Allied Nigeria Plc 

shares are up 240 percent in the 

last four years to close at N21.20 

as at 2:00 pm close of trading on 

Friday. 

Nestle stock is up 36.4 percent 

since year end 2015 to close at 

N1400 on Friday, while Unilever 

has rallied by 84 percent since 

2015, as its net profit margins 

doubled to 8.2 percent from 4.4 

percent. 

Johnson Chukwu, managing 

director and CEO of Cowry Asset 

Management said that individual 

performances of firms are one 

out of four factors that determine 

an investor’s decision to invest in 

a company. 

He added that if the economic 

outlook is negative, then investors 

will not put their money 

in firms no matter the stellar 

performance. 

“All things being equal, 

if there is political stability, 

lower interest rates and low 

inflation, then firms with increased 

margins will see investors 

swoop on their shares,” 

summed Chukwu.


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COMMENT 

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Severe head injuries (trust, deception and good neighbours) 

BASHORUN J.K RANDLE 

Randle is Chairman/Chief 

ExecutiveJK Randle Professional 

Services Chartered Accountants 

Chief Matthew Tawo 

Mbu from Okundi, 

Boki LGA in Cross River 

State was only twentytwo 

years old when 

he was appointed as a Member 

representing Ogoja in the Eastern 

House of Assembly and House of 

Representatives in 1952. In 1953, 

at the age of twenty-three, he was 

appointed as Minister, Federal 

Ministry of Labour. He remains 

Nigeria’s youngest ever minister. 

Thereafter, he served as our First 

High Commissioner in London 

(the Court of St. James) from 1955 

to 1959 and Foreign Minister from 

January to November 1993 

While he was our High Commissioner 

in London, he attended 

University College, London and 

bagged a degree in law. 

It was an amazing feat of selfactualisation 

and upward mobility. 

Regardless of his superlative 

achievements, he endeared himself 

to all and sundry with his exceptional 

humility and good natured 

disposition. He was also blessed 

with a great sense of humour. He 

died in Hampstead, London, U.K. 

at the age of 82 on February 6, 2012. 

Whenever our paths crossed, 

mostly on planes or at social 

engagements, he simply overwhelmed 

me with his concern for 

the “Nigeria project” and the role 

which he felt I should play – in the 

footsteps of my father Chief J.K. 

Randle and my grandfather Dr. 

J.K. Randle. 

He never failed to remind me 

that my father, regardless of the 

difference in their age, treated him 

as a dear friend. Hence, he was 

duty-bound to sustain and nourish 

the goodwill which I had inherited. 

We have to rely on the amazing 

leap in technology which has made 

it possible for late John F. Kennedy, 

President of the United States 

of America to deliver in his own 

voice the speech he was about to 

read in Dallas, Texas. Tragically, 

he was assassinated while his 

motorcade was on its way to the 

venue– The Dallas Trade Mart; 

to address the Citizen’s Council. 

In the case of our beloved 

Ambassador M.T. Mbu, the audience 

at the launching of his book: 

“M.T. Mbu: Dignity In Service” at 

Yar’Adua Centre, CBD, Abuja on 

Tuesday 10th April, 2018 were 

stunned when he spoke “live”: 

“I was in Kaduna on January 5, 

1966, to represent the Prime Minister 

at the commissioning of the 

air force base when I overheard 

soldiers discussing a coup. 

I confronted the GOC and 

said, ‘You are discussing a coup!’ 

That was my good friend, Sam 

Ademulegun. He and two of his 

friends were of Brigadier rank: 

Brigadier-General Aguiyi Ironsi 

and Brigadier-General Maimalari. 

Sam, who was GOC, retorted, 

‘It’s not you we want, we know 

the people we want, those who are 

corrupt must be removed from the 

system,’ and I was alarmed. 

I said to my good friend Sam, 

‘The coup you propose to carry 

out, won’t you use guns with 

bullets? If you use guns with bullets, 

will the bullets distinguish 

between the corrupt and the 

non-corrupt? Once bullets are 

fired, they don’t discriminate. If 

the target is a human being and it 

hits you, you will die.’ 

He patted my back and said, 

‘We won’t hurt you MT, you are 

everybody’s friend. We know the 

people we want to remove.’ Unfortunately, 

my good friend, Sam 

Ademulegun himself perished in 

the coup with his wife. He didn’t 

survive the coup because he 

didn’t know that he was going to 

be a target.” 

Upon his return to Lagos, Ambassador 

Mbu alerted Alhaji Sir 

Abubakar Tafawa Balewa of the 

plan to carry out a coup by senior 

officers in the military who were 

openly discussing the matter, but 

the Prime Minister said to him: 

I said to my good friend 

Sam, ‘The coup you 

propose to carry out, won’t 

you use guns with bullets? 

If you use guns with 

bullets, will the bullets 

distinguish between the 

corrupt and the noncorrupt? 

Once bullets 

are fired, they don’t 

discriminate. If the target is 

a human being and it hits 

you, you will die.’ 

“Matthew, you worry too much.” 

We have to rely on the extract 

from Lindsay Barret’s book: “Danjuma: 

The Making Of A General”; 

Dr. Nowa Omoigui’s account of 

events:“Operation Aure”;and the 

leaked version of events by Julien 

Assange of WikiLeaks and Edward 

Snowden, the fugitive former CIA 

consultant regarding what transpired 

on 29th July, 1966 when the 

counter coup occurred: 

“Upon arrival at the Government 

House, Ibadan, having established 

that the Supreme Commander was 

in, Major Danjuma was confronted 

by two command problems. Both 

arose from the fact that he neither 

belonged to the 4th battalion nor 

was he part of the National Guard, although 

he was senior to all the boys 

on the ground. First task, therefore, 

was to ensure the cooperation of 

those elements of the 4th battalion 

who were on duty there. The second 

was to secure the cooperation of 

the National Guard Commander on 

the ground. In order to address the 

first problem he asked the adjutant 

(“Paiko”) to issue a “legitimate” 

order that all his soldiers on duty be 

disarmed by the duty officer (Onoja) 

who was there to conduct a “legitimate” 

inspection. 

After being disarmed by the Duty 

Sergeant, they were illegitimately 

screened and those who could be 

trusted (i.e northerners), illegitimately 

rearmed. Then they were supplemented 

by the pre-selected group 

Danjuma brought along from the 

barracks with Onoja. To deal with 

the second problem he confronted 

Lt. William Walbe directly and secured 

his cooperation. This wasn’t 

too difficult. Although they were in 

different cells, Walbe himself had 

been attending separate meetings 

in Lagos with Joe Garba and others 

and was well aware of the outlines 

of a coup plot although he did not 

expect one that night. 

Once the building was surrounded 

and the 106 mm gun 

positioned in support, Danjuma 

came under pressure from the boys 

on the ground to proceed with the 

operation. There were fears, based 

on myths acquired in the Congo, 

that General Ironsi was assisted by 

“juju” and that he could disappear 

at any time using his “crocodile”. 

Junior officers who had come to 

join the party urged immediate 

attack, some even suggesting a repeat 

performance of the Nzeogwu 

assault on the Nassarawa Lodge in 

Kaduna in January. They wanted 

the 106 mm weapon used to bring 

down the complex. Danjuma resisted 

the pressure. 

Lt. Col. Hilary Njoku, Commander 

of the 2nd Brigade in Lagos, 

then emerged from the main 

building and was walking right 

past the soldiers on duty moving 

toward the gate. One account says 

he came up from Lagos with Ironsi, 

had been staying at the guest house 

next to the main lodge, but was at 

the main lodge where Ironsi was 

staying, socializing with both Ironsi 

and Fajuyi. Another account says 

he came up from Lagos that evening, 

when rumours of a coup gained 

strong currency among senior 

Igbo officers in Lagos, to brief the 

Commander-in-Chief. 

When he attempted to leave the 

premises, ostensibly to mobilize 

loyal units, he was shot at by soldiers 

who had been ordered not to 

let anyone out and he responded 

in kind. (Some say he shot first). 

Luckily he escaped with serious 

injuries, some say with no less than 

8 pieces of shrapnel in his thigh. 

Njoku initially made his way to the 

University College Hospital but had 

to escape again when a “mop up” 

team came searching for him. 

At this point, Lt. Onoja asked 

for permission to leave, saying he 

was going to get more ammunition 

from the barracks. However, he 

panicked and ran away in one of 

the landrovers, fearing that Njoku’s 

escape meant the coup would fail. 

He was later arrested at Jebba. 

When it became apparent that 

Njoku had escaped, Danjuma, 

guarded by two soldiers, made 

rounds to check all guard positions 

around the lodge and was moving 

toward the guest house when he 

heard the phone there ringing. He 

asked one of his guards to break 

the window so he could reach in 

to answer the phone. According to 

General Danjuma (rtd), this is how 

the conversation went: 

Danjuma: “Hello” 

Gowon: “Hello. I want to speak 

to the Brigade Commander. I want 

to speak to Colonel Njoku. 

Danjuma: “May I know who is 

speaking?” 

Gowon: My name is Gowon. 

Yakubu Gowon.” 

Danjuma: “Rankadede. This is 

Yakubu Danjuma.” 

Gowon: “Yakubu, what are you 

doing there? Where are you?” 

Danjuma: “I am in the State 

House here.” 

Gowon: “Where is the Brigade 

Commander?” 

Danjuma: “He is not around.” 

Gowon: “Have you heard what 

has happened?” 

Danjuma: “Yes, I heard and that 

is why I am here. We are about to 

arrest the Supreme Commander. 

The alternative is that the Igbo boys 

who carried out the January coup 

will be released tit for tat since we 

killed their own officers.” 

Gowon: (after a period of silence) 

“Can you do it?” 

Danjuma: “Yes, we have got the 

place surrounded.” 

Gowon: “But for goodness sake 

we have had enough bloodshed. 

There must be no bloodshed.” 

Danjuma: “No, We are only going 

to arrest him.” 

Send reactions to: 

comment@businessdayonline.com 

DANIEL AKINMADE EMEJULU 

Daniel Akinmade Emejulu is a sustainability 

professional. In 2017, as Nigeria 

country manager for the UN’s UNEP 

Inquiry arm, he worked with stakeholders 

involved in launching the country’s first 

sovereign green bond 

Nigeria joins regional race for green bonds 

Nigeria is joining a silent 

revolution. Only three 

countries have issued 

a sovereign green bond 

— Poland, France and Fiji — and 

now Nigeria is the most recent 

member of the movement. As an 

oil-producing giant, the country 

has long been in search of a trump 

card against falling crude prices. 

In December, the government 

issued a N10.69bn ($29m) green 

bond to fund local solar and forestry 

projects. 

The fully subscribed bond’s 

tenor is five years, and investors 

will receive a 13.48 per cent annual 

coupon, creating high expectations 

for the environmental 

projects linked to the government’s 

use of proceeds from the 

bond. Given the strong market 

uptake, the green bond movement 

is inspiring a race on the 

African continent. Last July, the 

City of Cape Town issued a R1bn 

($84m) green bond for which 

investors offered R4bn — within 

two hours. Kenya is also paying 

attention and positioning to do 

the same. 

“We are setting up a framework 

for issuing a green bond 

in the fiscal year 2018-19,” said 

Geoffrey Mwau, director-general 

of the Kenyan treasury. 

Ahead of national elections 

in 2019, the Nigerian government 

considered 2018 as perfect 

timing for doubling down on its 

first green bond issue. During 

the Lagos Social Media Week last 

month, Ahmad Salihijo, a technical 

assistant to the Nigerian 

minister of the environment, 

said the government planned to 

issue an additional N150bn in 

green bonds, potentially to finance 

climate-related work for women 

and non-state actors in Nigeria. 

The green bond issuance marks 

a breakthrough for Nigeria, contributing 

towards the commitments 

it made under the Paris climate 

change agreement, while also 

confronting poverty and triggers of 

insecurity. Muhammad Mamman- 

Daura, an investment banker at 

Chapel Hill Denham, the financial 

adviser for the green bond issue, 

said the proceeds would be used 

to provide green electricity to rural 

communities that had been in 

darkness, energise education and 

support a government afforestation 

initiative. 

DNV GL of Norway, a global verification 

and sustainability group, 

reviewed the green credentials 

of each initiative before endors- 

ing the use of bond proceeds for 

these projects, which come under 

Nigeria’s ministries of power and 

environment. Listed on both the 

Nigerian stock exchange and 

FMDQ, an over-the-counter exchange, 

the first $10m tranche 

of the green bond programme 

received a GB1 (excellent) rating 

from Moody’s. 

The London-based Climate 

Bonds Initiative also granted certification, 

confirming its alignment 

with the 2-degree global warming 

limit in the Paris Agreement. 

Nigeria’s issuance was the first of 

four sovereign green bonds to be 

granted the CBI’s best practice 

distinction, lending confidence 

to banks, institutional and retail 

investors who took up the bond. 

Christiana Figueres, the UN climate 

czar who was instrumental 

to the success of the Paris Agreement, 

has convened Mission 

2020, an initiative calling for $1tn 

of investment in green bonds, a 

more than 10-fold increase from 

current levels. Governments in 

Morocco, Sweden and Belgium 

are joining the queue to answer 

the call. Since the first wave of 

green bonds, issued by the European 

Investment Bank and World 

Bank in 2007, entities such as 

Apple, Toyota and the New York 

Metropolitan Transport Authority 

have raised more than $80bn 

from green bonds. As Nigeria’s 

federal government promises 

forthcoming tranches of issuance 

to help meet this $1tn target, its 

state governments and private 

sector are also now jockeying to 

get on board. 


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COMMENT 

C002D5556 

BUSINESS DAY 

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Heavy manufacturing and sustainability in Nigeria 

FOLASHADE AMBROSE-MEDEBEM 

Folashade Ambrose-Medebem is 

Director of Communications, Public 

Affairs and Sustainable Development 

at Lafarge Africa Plc 

Sustaining our common 

future is the responsibility 

of everyone. In September 

2015 the United 

Nations adopted the UN 

Sustainable Development Goals 

(UNSDGs) to end poverty, protect 

the planet and ensure prosperity 

for all. 

On our part at Lafarge Holcim, 

we have The 2030 Plan, which focuses 

on how we can improve the 

sustainability of our operations 

and adopt innovative, sustainable 

solutions for better buildings 

and infrastructure. Our plan also 

looks beyond our own business 

activities to our wider industry. 

We are committed to working in 

partnerships to make the entire 

construction value chain more innovative 

and more mindful of the 

use of resources and their impact 

on nature. We are also committed 

to improving the lives of people 

in communitiesby providing solutions 

to their challenges.For 

us, sustainability is not a one-off 

project. It is an overriding strategy 

for all we do and it is in response 

to some of the planet’s biggest 

challenges. 

Built on four pillars of Climate, 

Circular Economy, Water & Nature 

as well as People and Communities, 

the 2030 Plan aligns with the 

United Nations Sustainable Development 

Goals (UNSDGs). Each 

pillar outlines a set of quantitative 

internal and external targets as 

well as the innovative solutions 

with which to achieve them. 

The 2016 Sustainability Report 

of Lafarge Africa Plc documents 

the progress we have made in the 

past year across all four pillars. 

It details what we have done to 

reduce Carbon dioxide emissions, 

derive energy from waste and aim 

to operate with zero fatalities. 

Itlooks beyond our operations to 

how we provide water in communities 

where it is scarce, and the 

respective initiatives developed 

to impact thousands to build their 

dream home or improve literacy. 

Our annual sustainability reports 

are a testimonial of our commitment 

to promoting sustainable 

construction for a better society. 

Our core raw materials for 

cement production come from 

nature. We therefore treat nature 

with great care. For example, the 

cycle of mining in our mining 

sites is not complete until the land 

from which mining activity has 

been conducted is reclaimed and 

rehabilitated. Reclamation and 

rehabilitation involves restoring 

the mining area to a state as close 

as possible to what it once was before 

mining activity began. Many 

times, the reclamation process 

For us, protecting nature is 

also about improving the 

quality of human life. We 

achieve this through the 

various interventions in 

infrastructural amenities 

for our host communities. 

These interventions include 

scholarships, building and 

equipping of school blocks; 

health centres as well as 

bore hole and even electricity 

transformers 

begins way before the first shovel of 

coal or limestone is extracted from 

the ground. Experts in the mining 

team have to study the area’s ecology 

with a view to returning it to its 

original state after the mine is finally 

closed. We have so far reclaimed 

nearly 300 hectares of mined land 

in Shagamu and Ewekoro. All other 

sites have modern rehabilitation 

plans developed in 2017 for ongoing 

implementation from 2018 

and beyond. 

As natural resources become 

scarce we seek innovative solutions 

by recycling waste. We are focusing 

on new, sustainable ways to derive 

energy from biomass, industrial and 

municipal waste. Over the years, 

we have developed an Alternative 

Fuel(AF) strategy as part of our 

effort to reduce carbon dioxide 

(CO2) emissions. We successfully 

substituted 45% of fossil fuel used 

at our Ewekoro plant with palm 

kernel shells. Today we are pioneers 

in the use of biomass for fuel 

on an industrial scale in Nigeria. 

Our ambition is to depend less and 

less on fossil fuels by turning waste 

into energy. We see a growing 

waste industry and expect to use 

around 250,000 tons of waste in 

our plants by 2020. Increased use 

of palm kernel has both optimised 

our costs and created over 700 jobs 

in communities of the South West 

and Edo State where the kernels 

are sourced for use in our plants. 

The energy intensive nature 

of cement production means we 

must keep finding innovative 

ways to reduce emissions. Overall, 

compared to 1990, we achieved a 

40% net decrease of CO2of 532kg/ 

ton in 2016. At our newest plants 

- Ewekoro II and Mfamosing, we 

installed environmentally friendly 

state-of-the-art technologies that 

are already helping us achieve 

lower dust emissions. Our plants 

emit dust lower than the Nigerian 

Government regulatory limit of 

100mg/Nm3 

For us, protecting nature is also 

about improving the quality of human 

life. We achieve this through 

the various interventions in infrastructural 

amenities for our host 

communities. These interventions 

include scholarships, building 

and equipping of school blocks; 

health centres as well as bore hole 

and even electricity transformers. 

Sagamu is host to one of our plants 

in South Western Nigeria. In the 

past decade, several communities 

in Sagamu now have access 

to potable water from hundreds 

of boreholes built and maintained 

by Lafarge. In our own little way, 

we are contributing to a reduction 

ofwater-borne diseases. 

In 2017 alone, we invested a 

total of ₦748 million in various 

community development projects 

across locations where we operate 

and in the National Literacy Competition, 

anannual competition 

for public primary school students 

between ages 9 and 13 from across 

the country. Over 200,000 students 

have benefited since the competition 

began in 2013. A total of 77,000 

students from 686 schools in 244 

Local Government Areas took part 

in the 2016 edition. The impact has 

been significant: more than half 

of the students who participated 

considerably improved improved 

in their reading, writing and comprehension 

skills. Some states have 

introduced the Spelling Bee aspect 

of the competition into their curriculum. 

For us at Lafarge, sustainable 

development is about making a net 

positive contribution to society and 

to nature in the ordinary course of 

our respective operations. We are 

pleased with the milestones to date 

and remain committed to protecting 

people, the environment and 

nature for our common good. 


comment@businessdayonline.com 

C. DON ADINUBA 

Adinuba is Commissioner for Information 

and Public Enlightenment, Anambra 

State. 

A glimmer of hope in governance 

Since the relationship school, 

closely associated with Peter 

Drucker, made a robust comeback 

in the 1990s among leadership 

and management researchers, 

top management schools around 

the world have displayed a greater 

interest in the role of passion in the 

success of organizations. The resourcebased 

view (RBV) in strategic human 

resource management argues that a 

fundamental difference between high 

achieving organizations and average 

ones is the passion difference. While 

ordinary firms are run by people who 

work without passion, super performing 

organizations have members who 

go far beyond the call of duty to deliver 

the goods. 

Two expressions which are closely 

associated with passion by organizational 

members are deliberate practice 

and stretch. By deliberate practice, 

applied psychologists refer to people 

who put in greater effort than most of 

their competitors. Stretch in management 

science is a term in management 

scholarship first used in 1990 

by General Electric under Jack Welch 

to refer to a task that seemed initially 

impossible but eventually got done. 

Passion is extremely important in 

political leadership, too, especially in 

crisis situations and transformation of 

societies. Passion, sometimes referred 

to as commitment, is the heart of nationalism. 

One of the critical success 

factors for the phenomenal transformation 

of South Korea, Singapore, 

Taiwan, Hong Kong and other southeastern 

societies is the passion of the 

people and their leaders. Nationalism 

is now regarded as one of the core 

Asian values. We all saw how everyday 

people in South Korea brought out 

highly cherished personal assets like 

trinkets and sold and gave the proceeds 

to the government to enable it 

to weather the storm when their country’s 

economy went into a tailspin in 

the late 1990s. Western scholars, who 

used to mock the Asian countries for 

their acute nationalism, have since 

acknowledged that nationalism was 

a key factor in the quick recovery of 

Asian nations and territories from the 

profound currency crisis. That Biafra 

survived for a whole 30 months during 

the Nigerian civil war of 1967 to 1970, 

despite all the great odds, owed to the 

passion of the people. 

The first thing which struck new 

members of the Willie Obiano administration 

in Anambra State as 

they assumed office on Monday, 

March 25, was passion writ large. In 

fact, the passion thing had become 

manifest three days earlier, on the first 

day of the two-day retreat to prepare 

the members for the task ahead. The 

governor arrived at the retreat when 

most of the commissioners, special 

advisers, permanent secretaries and 

heads of the agencies were still eating. 

Because he uses no siren, the governor 

took most people by surprise. On 

the second day, he also arrived ahead 

of the time. 

Obiano sat through the two-day 

retreat, taking notes, contributing to 

every discussion on the scintillating 

presentations by Chukwuma Soludo, 

ex Central Bank of Nigeria governor; 

Osita Ogbu, an economics professor 

and director of Development Studies at 

the University of Nigeria, Enugu Campus, 

who is a former chief economic 

adviser to the president and chairman 

of the National Planning Commission; 

Ibrahim Magu, head of the Economic 

and Financial Crimes Commission; 

Daniel Okafor, a director of the Code of 

Conduct Bureau; Bismarck Rewane, the 

chief executive of Financial Derivates, a 

Lagos-based consulting firm; Macaulay 

Atasie of Nextzon, also in Lagos; Twinkle 

Oruware, an engineer and management 

consultant in Ibadan, Oyo State; Collins 

Onuegbu, a software consultant; and 

Fela Durotoye, an exceptional motivational 

speaker . Each presenter provided 

sufficient food for thought. 

Passion was also at display on the 

day the new appointees were inaugurated. 

Just before the inauguration, 

a short ceremony was conducted for 

those who worked with Obiano in his 

first term. John Emeka, the Anambra 

State deputy governor from 1999 to 2003 

who was to serve under Obiano as Commissioner 

for Science and Technology, 

delivered a soul-stirring speech which 

was apparently spontaneous. Far from 

showing bitterness for not being reappointed 

like most departing members 

of the council, Emeka told Obiano: “I 

will cherish participating in your government 

every day of my life. People of 

Anambra are very proud of you. This is 

why they voted for you overwhelmingly 

in the last November 18 governorship 

election”. Turning to the new members 

of the council, the ex deputy governor 

said: “You must prove your mettle 

from Day One. He is accessible and 

amenable. He wants you to disagree 

with him because he knows you are no 

robots; he likes good, healthy debates”. 

Like other members of the outgoing 

council, Emeka received a certificate 

of merit, a lapel pin of the state and all 

his entitlements right there. 

The government subsequently 

met with the ABS board. After that he 

entered the weekly Security Council 

meeting where he dominated the 

environment. Members of the council 

include not just the state police commissioner, 

the DSS director in the state, 

the Civil Defence and security Corps 

commander, the army and naval 

commanders in the state, the Commissioner 

for Information and Public 

Enlightenment, the governor’s special 

adviser on security, his special assistant 

on security and head of the state 

vigilante who is a respected retired 

police commissioner, but also heads of 

the Customs Service, the Immigration 

Service, the Prison Service, and the 

Federal Road Safety Corps. 

Obiano invites some other people 

to participate in the security council 

meetings depending on the issues for 

deliberations; this time a representative 

of the traders unions attended 

because of some market issues. The 

governor takes security so seriously 

that he counts the number of road 

blocks by security agents and the 

number of soldiers and policemen 

manning each at any point. He even 

noticed that some sandbags used by 

the police in remote riverine communities 

sharing border with Kogi 

State and ordered their replacement. 

The next day, he ran straight from 

Onitsha where he was attending the 

Maundy Thursday mass in Onitsha, 

as part of the Christian Holy Week of 

Easter, and headed straight to the Alex 

Ekwueme Square in Awka where he 

handed over 40 vehicles from the Innoson 

Vehicles Manufacturing firm 

in Nnewi to security agencies. He 

promised an additional “100 made in 

Anambra vehicles soon to the agencies 

to ensure our state remains the 

most peaceful in West Africa”. Val 

Ntomchukwu, the Deputy Inspector 

General of Police who represented IGP 

Abubakar Idris on the occasion, said: 

“Other states should emulate Anambra 

which has become the country’s safest 

state. The governor means every word 

he utters”. 

I have never seen the Anambra 

people so optimistic of their state as 

they have been in the last few months. 

Having been in office for just two 

weeks, I now have a better understanding 

of why Chukwuma Soludo, 

Bart Nnaji, Victor Umeh, Chris Okoye, 

Okey Ndibe and even Emeka Anyaoku 

and the Obi of Onitsha encouraged 

me to go to Anambra State and make 

my contribution to the development 

of the state, after my initial hesitance. 

Babatunde Fashola, the Minister of 

Power, Works and Housing, calm , cool 

and very measured as ever, spoke about 

Obiano the way I have never heard him 

praise any governor. 

Anambra State provides a glimmer 

of hope for Nigeria. 


comment@businessdayonline.com

12 BUSINESS DAY C002D5556 Monday 09 April 2018 

Editorial 

PUBLISHER/CEO 

Frank Aigbogun 

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Prof. Onwuchekwa Jemie 

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HEAD, HUMAN RESOURCES 

Adeola Obisesan 

Winnie Madikizela-Mandela (1936 – 2018) 

Winnifred 

Madikizela-Mandela, 

foremost 

and controversial 

anti-apartheid activist, 

mother of the nation, and 

former wife of South Africa’s 

late president, Nelson Mandela, 

passed away quietly in 

a Johannesburg hospital on 

Easter Monday after a long 

illness, for which she had 

been in and out of hospital 

since January, aged 81. 

“Mrs. Madikizela-Mandela 

was one of the greatest 

icons of the struggle against 

apartheid... She fought valiantly 

against the apartheid 

state and sacrificed her life 

for the freedom of the country,” 

a statement by her family 

read. 

Born and raised in the 

village of Mbongweni in Pondoland, 

Eastern Cape and 

trained as a social worker, 

her life took a different trajectory 

with her marriage to 

Nelson Mandela in 1958. Just 

six years into the marriage 

that produced two children, 

Mandela was convicted of treason 

in June 1964 and, together 

with 10 of his comrades, sentenced 

to life imprisonment 

in Robben Island. She was 

therefore left with the task of 

keeping the memory of her 

imprisoned husband alive 

and helped give the struggle 

for Justice in South Africa one 

of its most recognisable faces, 

earning her the sobriquet 

“Mother of the Nation.” 

Her commitment to the 

struggle soon landed her in 

trouble with the apartheid 

regime. She was variously exiled, 

imprisoned, and tortured 

by the apartheid regime and 

endured all sorts of indignities 

including the razing of 

her home that left her and her 

children at the mercy of the 

elements. Her brutalisation 

reached a head when she kept 

in solitary confinement for up 

to 18 months in dehumanising 

condition. It was at that point 

she became convinced that 

the struggle against apartheid 

could never be won through 

peaceful means and had to 

embrace violence. “We have 

no guns. We have only stones, 

boxes of matches, and petrol. 

Together, hand in hand, with 

our boxes of matches and our 

necklaces, we shall liberate 

this country,” she declared at 

a town hall meeting in Munsieville. 

That was the point of departure 

with her imprisoned 

husband, who she later complained 

had been softened by 

his long stay in prison and the 

high command of the African 

National Congress, ANC. 

But the disagreement with 

her was not entirely ideological 

but also based on her 

gender. The ANC could not 

conceive of her as a political 

figure in her own right outside 

the traditional roles of wife 

and mother. But she was astute 

enough to embrace those 

roles and use her position as 

the wife of political leader to 

fashion a platform for her own 

brand of radicalism, which 

neither the ANC nor her husband 

could contain leading 

to her marginalisation from 

the powerful decision making 

structures of the party. 

Although she belonged to 

the generation of South Africans 

that literally gave up 

everything and most of their 

adult lives to fight to liberate 

black people from the yoke of 

white minority rule, she paid 

direly for stepping outside the 

agreed parameters of the official 

party line and charting 

her own. They were all brutalised 

and their lives broken 

irretrievably by the struggle. 

They made mistakes in their 

personal lives. But unlike her 

male counterparts, her personal 

life and choices were 

always under spotlight and she 

was judged harshly for them. 

Despite her foibles, Madikizela-Mendala 

was a symbol of 

courage in dark times; a champion 

of freedom and human 

dignity. Fearless in the face of 

torture, imprisonment, banishment 

and betrayal, she was 

firm in her belief that apartheid 

could be brought down. 

The struggle definitely left its 

toll on her life and family. She 

will go down in history as one 

of the great African women of 

all times. 

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13

14 BUSINESS DAY C002D5556 


In Association With 

Protectionism in Africa 

Donald Trump’s other trade war—with Rwanda—over used clothes 

East Africans seek to defend their garment-makers from American cast-offs 

THE second-hand clothes 

trade often starts with a 

gift: an old dress or unwanted 

shirt, passed on for 

another to use. Along the way it 

becomes a multi-billion-dollar 

industry spanning several continents. 

It ends at a market stall, 

usually in Africa. And now it is 

the cause of President Donald 

Trump’s unlikeliest trade war. 

Private companies in America 

and Europe buy up surplus 

donations from charities and 

export them to the developing 

world. In 2016 east African 

countries resolved to phase 

out the trade, complaining that 

cheap cast-offs hurt their own 

nascent garment industries. 

America responded by threatening 

to impose tariffs on east 

African goods. Kenya, Uganda 

and Tanzania backed down. But 

Rwanda has stood fast. So on 

March 29th Mr Trump said he 

would suspend duty-free access 

for Rwandan apparel in 60 days. 

Technically, Rwanda has no 

grounds for complaint. Like 

39 other African countries, it 

enjoys access to American mar- 

kets under the African Growth 

and Opportunity Act (AGOA), 

enacted in 2000. One of the eligibility 

criteria is that countries 

progressively eliminate barriers 

to American goods. Rwanda has 

done the opposite, hiking duties 

on second-hand clothes 12-fold. 

“That is almost a de facto ban on 

these products,” complains an 

American official. 

East Africa accounts for over a 

fifth of the used-clothes market. 

Rwanda is only a small part of 

that. Its stand-off with America 

is not very costly for either side. 

In 2016, according to official 

statistics, Rwanda’s total usedclothes 

imports were only $18m 

(against $274m for east Africa 

as a whole). Its exports under 

AGOA were just $2m. 

But the case has wider resonance. 

African countries once 

nurtured their industries behind 

protective barriers. From 

the early 1980s they reluctantly 

opened their markets as a condition 

of foreign loans. Ghana lost 

four-fifths of its textile and clothing 

jobs. In Kenya, the number 

of big garment manufacturers 

fell by half. Garth Frazer of the 

University of Toronto estimates 

that second-hand imports account 

for 40% of the collapse 

in African apparel production 

from 1981 to 2000 (though the 

underlying data are fuzzy). 

Slapping tariffs on used 

clothes is unlikely to help. Sev- 

eral countries have already tried 

import bans; smugglers just 

carry clothes across the border 

in a suitcase, passing them 

off as their own. Most local 

manufacturers, burdened with 

patchy power and costly credit, 

cannot produce clothes cheaply 

enough for domestic consumers. 

Rwanda’s biggest textiles firm 

churns out uniforms, but not the 

trendy T-shirts worn by young 

men in Kigali. 

The gap in the Rwandan market 

will probably be filled by imports 

from China, already worth 

$12m in 2016. The immediate 

losers will be consumers, who 

will pay more. A survey by the 

American government finds that 

95% of used-clothing imports 

in east Africa are bought by the 

poorest 40% of the population. 

Still, Rwanda seems determined 

to push on. A special 

economic zone in Kigali hopes to 

attract garment-makers. Reducing 

imports is part of a broader 

industrial strategy. In economic 

policy, too, Rwanda is pursuing 

its own style. 

Will Gaza boil over? 

The Palestinians in 

Gaza are once more 

bidding to burst out 

More mass protests are planned in the 

cramped strip 

THE skies above the eastern suburbs 

of Gaza City buzzed with 

drones on March 30th. The Israeli 

army was using them to monitor 

the tens of thousands of Palestinians 

marching to the border, and to drop 

tear-gas grenades on those getting 

too close. When some of the marchers 

began running closer, the troops 

opened fire, killing 17 and wounding 

hundreds. Three and a half years after 

the last Gaza war, when 2,300 Palestinians 

and 74 Israelis were killed, the 

beleaguered coastal strip was erupting 

again. There were no casualties on 

the Israeli side, but the mass protests 

pose a new challenge. 

The Palestinians are calling it the 

“Great Return March”, a salute to the 

homes their grandparents lived in, 

across the border, before they fled 

or were pushed out by the newborn 

Israel. They promise to keep marching 

for another six weeks, at least. From 

Israel’s perspective, these are “acts of 

terror”, aimed at sabotaging the border 

fence and orchestrated by Hamas, 

the militant Islamist group that 

wrested control of Gaza from the Palestinian 

Authority (PA) in 2007 after 

winning an election the year before. 

Since then Gaza’s neighbours, Israel 

and Egypt, have imposed a near-total 

blockade on the cramped strip’s 1.8m 

people. But the march’s organisers insist 

that they do not represent any one 

movement, and are simply protesting 

against their perpetual refugee status 

and the siege. 

After seven years of upheaval 

throughout the Arab world, the Palestinian 

issue has slipped down the 

international agenda. The administration 

of President Donald Trump 

is firmly behind Israel. International 

condemnation after the deaths on 

the border was relatively muted. 

Even Arab capitals issued no more 

than bland statements. Saudi Arabia’s 

crown prince, who is touring America, 

Continues on page 15


C002D5556 

BUSINESS DAY 

15 


The dragons fly 

Chinese aviation takes off 

The West should not pull up the drawbridge against a new wave of disrupters 

OVER the past few 

decades, established 

airlines in Europe 

and America have been hit 

by one thing after another. 

First came low-cost carriers, 

chipping away at their shorthaul 

routes. Lately, a new 

crop of super-connecting 

airlines in the Gulf, Emirates, 

Etihad and Qatar Airways, 

has lured away their 

long-haul passengers with 

superior service and lower 

fares. Now looms the biggest 

threat of all—the rise of 

several promising Chinese 

airlines (see article). Unfortunately, 

the response of the 

incumbents risks depriving 

passengers of the benefits 

from this latest wave of competition. 

China’s airlines are rising 

up the world rankings at a 

breathtaking pace. In 2007 

passengers in China made 

184m journeys by air; last 

year around 550m did. The 

International Air Transport 

Association, a trade 

group, predicts that China 

will leapfrog America as the 

world’s biggest market in the 

coming five years. During 

the next two decades Airbus 

and Boeing, the world’s two 

big manufacturers of passenger 

aircraft, forecast that 

Chinese carriers will buy 

more jets than American 

ones. 

Passengers who had a 

choice used to avoid Chinese 

airlines. Delays were 

common, accidents frequent 

and the food inedible. 

However, after a concerted 

effort to improve standards, 

they are winning flyers over. 

OAG, a data firm, reckons 

that in 2011-17 the proportion 

of passenger seats 

between China and America 

on Chinese airlines rose 

from 37% to 61%. 

Losing the battle to fly 

people in and out of China is 

one thing. But the menace to 

the world’s established carriers 

goes deeper. Just as the 

Gulf airlines expanded by 

offering connecting flights 

to international passengers 

through their Middle Eastern 

hubs so, too, are Chinese 

airlines turning themselves 

into connectors. The cheapest 

way to get from London 

to Australia, for instance, is 

no longer via Dubai or Abu 

Dhabi but through Guangzhou, 

Shanghai or Wuhan. 

The Chinese authorities 

have loosened visa requirements 

to encourage this 

kind of transfer traffic. 

China’s arrival as an 

aviation superpower has 

prompted two responses 

from big Western carriers— 

both predictable, neither 

good. The Europeans are 

crying foul about government 

aid, just as they did 

when the Gulf airlines became 

a threat. The bosses 

of Air France-KLM and Lufthansa 

wail that they are 

the victims of “unfair trade”. 

They are lobbying for rules 

that would let the European 

Union place unilateral sanctions 

on subsidised foreign 

rivals, Chinese carriers 

among them, even before 

any investigation has been 

concluded. 

The fact that Chinese airlines 

benefit from support 

from the state is not in question. 

But the outrage of rivals 

is shamelessly confected. 

Around the world, the aviation 

industry has been built 

on government support. 

CE Delft, a research firm, 

reckons that French airlines 

get €1bn ($1.2bn) in energy 

subsidies alone each year. 

Unilateral sanctions might 

benefit incumbents, but 

would restrict choice and 

harm passengers. A tit-fortat 

battle over flying rights 

would hit Europe harder 

than China, which is fast 

becoming a sizeable net 

exporter of tourists. 

The big three American 

carriers have taken a different 

tack. They are also happy 

to play the protectionist 

card when it suits them. 

American, Delta and United 

have all been lobbying hard 

against the Gulf carriers, for 

instance. But with China 

they sniff an opportunity as 

well as a threat. They want 

an open-skies treaty, which 

would allow airlines to fly 

between any airport in the 

two countries. 

Fare trade 

In theory, passengers 

have much to gain from a 

deal of this sort. In practice, 

open-skies deals open the 

door to joint ventures (JVs), 

which are granted immunity 

from antitrust rules and 

so can potentially lead to 

higher prices. In 2006-16 the 

share of long-haul passenger 

traffic controlled by such JVs 

leapt from 5% to 25%. Three 

JVs account for almost 80% 

of the transatlantic market. 

The established American 

airlines would love to team 

up with Chinese rivals in 

order to dominate the Pacific, 

too. 

Neither shutout nor 

carve-up is good for passengers. 

In an ideal world, 

Europe and America would 

seek open-skies deals with 

China but design them to 

nurture competition rather 

than mute it. Airline JVs 

would be barred from gaining 

antitrust immunity. Airport 

slots would be allocated 

more fairly, so that the best 

landing and take-off times 

were not hoarded. State 

handouts would be transparent. 

Alas, the chances of reaching 

such a sensible accommodation 

with China’s airlines 

are low. Rising trade 

tensions between America 

and China are only part of the 

explanation (see article). The 

real problem is that big Western 

carriers would not much 

like such policies either. 

This article appeared 

in the Leaders section of 

the print edition under the 

headline “Dragons fly” 

You’ve seen the news, 

now discover the story 

Get incisive analysis 

on the issues that matter. 

Whether you read each issue 

cover to cover, listen to the 

audio edition, or scan the 

headlines on your phone, 

time with The Economist is 

always well spent. 

The Palestinians in Gaza 

are once more bidding... 


preferred to talk about a potential 

partnership with Israel. 

But the Palestinians are determined 

to draw the world’s attention. 

The marches have been scheduled for 

symbolic dates. The first coincided 

with their Land Day, marking a deadly 

protest in 1976, and with Passover. 

More are scheduled to take place in 

coming weeks, as Israel celebrates its 

70th anniversary; they will culminate 

on May 15th, when the Palestinians 

commemorate the naqba (catastrophe), 

the term they use for Israel’s 

birth and their dispossession. Israel’s 

defence minister, Avigdor Lieberman, 

warns that “anyone who goes close to 

the fence is risking their lives”. 

Isam Hammad, one of the march’s 

organisers, admits it will succeed “only 

if we can mobilise Palestinians in 

other areas and raise the issue of Palestinian 

refugees in the international 

media.” He knows the world is not 

that interested. But Gaza is Hamas’s 

only asset, so it is using it to bid for the 

leadership of the Palestinian cause, as 

well as to challenge Israel. 

Israeli intelligence analysts think 

Hamas has changed its tactics, if not 

its ideology. After a decade of building 

up its military muscle, in the shape of 

thousands of rockets and a network 

of cross-border tunnels from which to 

attack Israel, its leaders now know its 

weapons are ineffective. The rockets 

fired at Israel are intercepted by the 

Iron Dome missile-defence system. 

The tunnels are routinely destroyed 

by Israel. Rather than provoke another 

round of war and be blamed by 

Gazans for yet more suffering, Hamas 

has been looking for ways to break out 

of its isolation. 

But two years of negotiations with 

Egypt and the PA, which is still dominated 

by its Fatah rivals, have failed to 

yield a breakthrough that would open 

Gaza’s gates. Hamas is now returning 

to the “popular struggle” of the first 

intifada (uprising) which broke out 

in 1987. The hope is that the sight 

of young people throwing stones at 

armed Israeli soldiers will refocus the 

world’s attention on the Palestinian 

cause. Hamas’s new chief in Gaza, 

Yahya Sinwar, also thinks a popular 

struggle will boost his chances in the 

battle to become the Palestinians’ next 

leader, once the ailing, unpopular 

Mahmoud Abbas leaves the stage.




“ 

Taxes and taxis 

How African cities can pay for their own upkeep 

Kampala shows the way 

WE PAY our money 

and you see how it 

looks,” says Aggrey 

Batwala, leaning out of his 

minibus in Kampala’s muddy 

taxi park. Shared taxis used 

to pay city authorities 120,000 

shillings ($32) a month for the 

right to ferry commuters into 

the Ugandan capital. But in 

September indignant drivers 

stopped coughing up. They 

later complained to the president, 

who ordered that the levy 

be halved. The city appealed 

against his decision and the 

drivers still aren’t paying. The 

stand-off could cost it 21bn 

shillings this year. 

Kampala shows why African 

cities struggle to raise revenues, 

squeezed as they are between 

poor citizens and overweening 

central governments. But 

it also proves that doing better 

is possible. In 2010-11 the city 

collected just 30bn shillings (see 

chart). Last year it raised 89bn 

shillings, about a third of its nonaid 

budget (the rest comes from 

central government). Its experience 

offers lessons for African 

cities, which will triple in size by 

2050. They need roads, drains and 

lights. Yet many look to central 

governments for funds rather 

than seek ways to raise their own. 

The change in Kampala began 

in 2011 with the creation of the 

London’s bleeding 

Knife crime is surging in London 

There were more murders in March than in any month for more than a decade 

IT WAS another bloody week 

in London. On April 4th a 

young man was stabbed to 

death in the street. Earlier that 

day, a man died in a bookmaker’s 

and, across town, 

another was fatally stabbed. 

On April 3rd a 16-year-old boy 

died from gunshot wounds. 

The day before, a 17-year-old 

died in her mother’s arms after 

being shot from a passing car. 

On April 1st a 20-year-old was 

stabbed to death. So far this 

year, the capital has seen 51 

murders. 

The press is alarmed. Last 

weekend the Sunday Times 

claimed that London “is starting 

to look a bit like New York 

once did”. That is overstating 

things. London’s murder tally 

last year was far lower than 

that of New York, let alone that 

city’s peak of 2,245 in 1990. 

There were 130 murders in 

London in 2017, compared with 

Kampala Capital City Authority, 

a group of unelected technocrats 

which assumed most of the powers 

of the old city council. It took 

over a city with too many official 

bank accounts. Revenue collection 

was farmed out to middlemen 

who beat money out of taxi 

drivers, handing only a fraction 

to public coffers. The first step 

was sorting out administration 

and compliance. Collection was 

brought in-house. A new system 

allowed citizens to pay on their 

mobile phones. 

Early gains came from taxi 

292 across the pond. Though 

London’s total was a little higher 

than New York’s in February 

and March, it was far lower in 

January. 

Yet there are good reasons 

for Londoners to be concerned. 

There were more murders in 

March than in any month for 

more than a decade. Violent 

crime involving a knife rose 

fees and business licences. They 

are predictably unpopular. Betty 

Ssuubi, who sells clothes downtown, 

says the licence for which 

she pays 210,000 shillings annually 

is too high. “Just look at 

this business,” she says, her shop 

barely bigger than a wardrobe. 

Next came a drive to collect 

more property taxes. These 

should fall more heavily on the 

rich, rise as better services push 

up house prices and be harder to 

dodge. But the most recent valuation 

was in 2005, so new malls 

and office blocks were not on the 

by a third in the 12 months to 

July 2017. The victims are often 

young and are disproportionately 

black. 

Why is London getting so 

bloody? About 40% of youth homicides 

are gang-related. Some 

target teenagers who are being 

used to run cash and drugs to lucrative 

markets beyond the capital. 

Feuds escalate more quickly 

register. That is not unusual in 

Africa. Nairobi has not updated 

its roll since 1982. 

Valuers are now traipsing 

around Kampala, registering 

properties on tablet computers. 

In the business district they 

counted 16,000 buildings, doubling 

the size of the roll and 

tripling revenues from the area. 

Fred Andema, the city’s chief taxman, 

hopes to raise 50bn shillings 

a year from property once the 

valuation exercise is complete. 

But he also estimates that he loses 

20bn shillings because national 

than in the past, because rival 

gangs goad each other on social 

media, police say. Others point 

to the dwindling number of coppers 

on the beat: the number of 

officers in England and Wales 

has fallen by 19% since its peak 

in 2010. “Neighbourhood policing 

has all but vanished,” says 

David Lammy, a Labour MP in 

north London. “The intelligence 

that police pick up on the ground 

isn’t really there.” 

London’s newish chief of police, 

Cressida Dick, agrees with 

the mayor that the force should 

reverse the decline in the use of 

stop-and-search powers, which 

have been criticised for targeting 

ethnic minorities. She also 

wants knife crime to be regarded 

as a public-health issue, making 

it a priority for the health 

service and councils as well as 

the police. Such measures will 

come too late for Tanesha Melbourne-Blake, 

the 17-year-old 

law exempts owners who occupy 

their properties from paying the 

tax. 

That suggests the third and, 

perhaps, most important step: 

better policies. Often national 

politicians get in the way. Consider 

borrowing, which might benefit 

some cities (though not all). 

Kampala secured its first credit 

rating in 2015, but has not issued 

a bond because of a centralgovernment 

cap on city debts. 

That year Senegal’s government 

forced Dakar to abandon a bond 

just two days before the planned 

issue. Civil servants cited regulations; 

cynics noted the mayor’s 

rivalry with the president. 

Politics is not always a hindrance. 

Opposition governors in 

Lagos see tax reform as a way to 

transform the city and build their 

base. In Kampala democracy 

has been sidestepped. Jennifer 

Musisi, the city’s top technocrat, 

says that gives her “more freedom 

to do what is right”. 

Ms Musisi points to better services 

and smoother roads. But the 

scale of the city’s problems still 

dwarfs the available resources. 

And her tough approach has 

more admirers on the affluent 

hillsides than in the slums between 

them. “It’s not fair,” says 

John Dungu, a shopkeeper. When 

it rains, he notes, the valleys still 

flood. 

who died on April 2nd. “To my 

baby Nesha,” her mother wrote 

on a note attached to flowers she 

left at the scene, “I’m gonna miss 

you so much.”


17

18 

BUSINESS DAY 

C002D5556 



19

20 

BUSINESS DAY 

COMPANIES 

& MARKETS 

Company news analysis and insight 

C002D5556 


Only 42% of 92m mobile 

subscribers use mobile 

banking app 

Pg. 21 

PHARMA DEKO records 94% drop in 

profit as operating cost surge 

MICHEAL ANI 

Despite a rebound in 

economic activities 

that has been 

witnessed in the 

pharmaceutical industry, 

Pharma Deko, one of the biggest 

players in the Nigerian 

drug market and fast moving 

Consumer goods (FMCG) 

space, recorded a 94 percent 

decline in profit on the back 

of a high operating cost in full 

year 2017. 

In 2017, the pharmaceutical 

firm posted a profit after 

tax (PAT) of 12.6 million, 

representing a 94 percent 

from the 218.7 million that 

it recorded in 2016, during 

the thick of the economic 

recession. 

A cursory look at the 

firm’s stock price shows that 

investors are finding its stock 

unattractive as the firm stock 

price is trading at a negative 

4.66 percent, underperform- 

ing the NSE all-share index 

of 6.79 percent year-to-date. 

Further analysis indicated 

that the company’s total 

assets were down by 53.4 

million to N2.27 billion last 

year from N2.32 billion two 

years ago. Total liabilities 

also fell increased by 55.2 

million to N52.8 million in 

2017 from N58.3 million in 

2016. 

The pharmaceutical 

industry is one of the industries 

that are greatly influenced 

by political and 

economic changes. 

In terms of production, 

contributions from Pharmaceutical 

Manufacturing 

Group of Manufacturers’ Association 

of Nigeria (PMG- 

MAN) and United Nations 

Industrial Development Organization 

(UNIDO) affirm 

that the local pharmaceutical 

manufacturing industry 

in Nigeria is currently able 

to meet 25 per cent of local 

demand. The remaining 75 

per cent has to be covered 

with imports from Asian 

companies, most especially, 

China. 

Production in the sector of 

has been greatly constrained 

by the present economic 

recession that affected the 

country in 2016. As pharmaceutical 

companies experienced 

difficulties in producing 

drugs, dispensable. 

These constraints arise as 

a result of exchange rate fluctuations, 

import duties, high 

taxation, poor infrastructure, 

inadequate human capital 

and non-availability of raw 

materials. This is as a result of 

the over dependence on the 

Nigerian oil market, excessive 

dependence on imports 

for both consumption and 

capital goods and the sharp 

fall in foreign exchange earnings. 

For the year ended December 

2017, the cost of production 

for the drug making 

firm surged by 39.4 percent 

to 830.2 million from 595.6 

million in 2016. 

Swift Networks partners global 

brands, shops to provide free 

internet service to Nigerians 

Daniel Obi 

Swift Networks, Nigeria 

foremost broadband 

service provider 

to enterprises and 

residential customers has 

entered into partnership with 

global brands and shops in 

Lagos to offer free broadband 

Wi-Fi service to Nigerians. 

Under the partnership, Swift 

Networks will provide systems 

for free Wi-Fi for consumers. 

The service code-named 

Red Cheetah, a new brand 

under the stable of Swift Networks 

will start with initial 

10,000 hotspots distributed 

all over the state, supported 

by advertising revenues from 

global brands and partners. 

Other cities will follow. 

The product which is expected 

to solve consumers’ 

quest for internet will help to 

deepen Nigeria’s broadband 

penetration and aspiration 

for universal internet access 

for greater social equity and 

inclusion. 

“The Red Cheetah service 

model follows in Swift’s tradition 

of demystifying and 

making technology to work 

for Nigerians so that they can 

hook up to the digital world to 

explore, work and entertain 

more efficiently”, says Charles 

Anudu, the entrepreneur behind 

Swift Networks. 

He told newsmen at the 

unveiling of the product that 

Swift is excited to pioneer this 

cutting edge service model 

and will rapidly extend it to 

more cities in Nigeria and the 

continent. 

According to Anudu who 

explained that entrepreneurship 

is not about making money 

first but solving society’s 

needs said security of every 

user’s access is enhanced by 

the Red Cheetah App which 

establishes a distinct and secure 

Virtual Private Network 

connection to the internet for 

each device on the platform. 

“I strongly believe that this 

dogged work of over two years 

is the ideal model that will empower 

Nigerians to live their 

most productive lifestyles in a 

digital world. I am proud that 

everything about Red Cheetah 

is Nigerian and shows what we 

can achieve when we commit 

to solving the problems of our 

society taking our context into 

consideration” 

In his view, Chukwuma 

Okoye, the Chief Operating 

Officer of Swift said the 

company’s plan is to roll our 

an initial 10,000 Red Cheetah 

hotpots in Lagos which will 

be the largest Wi-Fi footprint 

of its kind in Africa and will 

cover many verticals including 

schools, airports, buses, 

taxis, shopping malls, bars, 

clubs, open markets and 

hospitals. 

He said the service is fast, 

secure and reliable and supported 

by legendary sponsor 

brands which also have 

strong commitment to CSR. 

The company has presently 

achieved 500 hotspots. 

L-R: Yoichi Sagara, general manager, Africa department, Toyota Motor Corporation; representative 

of First Bank, plc; Micheal Ade-Ojo, chairman, Toyota Nigeria Limited, and Henry Ade, head, 

dealer development/ special project, Toyota Nigeria Limited, during the presentation of the 

evergreen customer of the year award to First Bank PLC at the Toyota awards 2018 in Lagos 

on Thursday. 

Pic by Pius Okeosisi 

CFOs apprehensive about tax multiplicity – KPMG survey 

HOPE MOSES-ASHIKE 

Chief Financial Officers 

(CFOs) in Nigeria have 

identified tax, regulatory 

and government 

policy as the most important 

‘stay awake’ issues for them. 

The critical concern is closely 

followed by those arising from 

internal challenges such as 

margin enhancement, growth 

and cost optimization. 

These findings were revealed 

in the 2018 KPMG CFO 

Outlook survey report that was 

presented at the KPMG CFO 

Forum which held recently in 

Lagos. 

The report shows that only 

46 percent of the CFOs who 

were surveyed were optimistic 

about the prospects of growth in 

2018 compared to 2017. 

“The overriding sentiment is 

that there is still a lot more that 

needs to be done to make this 

issue of ease of doing business 

a reality. Only 15 percent said 

government efforts to improve 

the ease of business were seen 

as effective, 45 percent of the 

CFOs were neutral and 40 percent 

said the efforts were ineffective”, 

Tola Adeyemi, Partner 

and Head, Audit Services at 

KPMG in Nigeria said . 

The event had in attendance, 

Chief Financial Officers, 

Finance managers/controllers 

and Finance directors from 

businesses representing all sectors 

of the economy. 

Presenting the CFO outlook 

survey report, Adeyemi, 

explained that CFOs and 

heads of finance in leading 

organizations across all major 

sectors in Nigeria shared their 

opinions on the outlook for 

their businesses, their strategies 

for cost and risk management 

and the priorities for an 

enabling environment. The 

survey report also includes 

revelations around what CFOs 

believe that the Government 

should prioritize to create an 

enabling environment. 

Babatunde Fowler, FIRS 

Executive Chairman, delivered 

a keynote address at the 

event, titled ‘Outlook for tax 

administration in Nigeria and 

opportunities for enhanced 

collaboration with the private 

sector’. 

He said that “the country 

faces a huge infrastructure 

deficit, as documented in 

the recently launched Nigeria 

Economic Recovery and 

Growth Plan (ERGP). Nigeria 

needs to invest USD3 trillion 

in infrastructure over the 

next 30 years. He went on to 

say that Taxation will play a 

key role in the development 

process by providing the 

needed resources to fund 

government developmental 

projects and programmes, 

as the Federal Government 

alone cannot provide these 

resources. 

Speaking on some of the 

advancements done by the 

institution, Fowler said, “The 

FIRS has taken bold steps aimed 

at broadening its tax base and 

increasing tax collection. In collaboration 

with other relevant 

government agencies, the FIRS 

also undertook a massive nationwide 

registration exercise 

of new taxpayers in 2016”.


Only 42% of 92m mobile subscribers 

use mobile banking app 

BUNMI BAILEY 

Only 42 percent of 

banking customers 

are currently 

using their bank’s 

mobile banking 

applications against a 92 million 

mobile telephone subscribers 

with internet access in 2017, 

according to the 2018 mobile 

banking report by Neetch Company. 

The report contains the outcome 

of a research conducted 

by the company which is aim to 

bridge the gap between banking 

products and customer 

experience. 

According the report an 

estimated 148 million mobile 

telephone subscribers and at 

least 92 million of them with 

access to Internet data on their 

mobile devices, there has been 

a decrease in total Internet 

banking log-ins against mobile 

banking log-ins year on year. 

“This shows that people 

are still not tech friendly. The 

network for those applications 

are still in the hands of telco 

and all that and a lot of time 

when there is failure from 

telecommunications and all 

FINTECH sets to give Africans a 

blockchain experience 

Fintech Worldwide Limited, 

a London based 

Events Company with 

an emphasis on emerging 

technology is set to give the 

African continent a new vista 

in digital technology known 

as the blockchain. Declaring 

this at a press conference in 

Lagos recently, Steph Mekwuye, 

Founder and CEO Eka Consult 

and Strategist/ Coordinator 

for the Fintech worldwide in 

Africa, said the initiative will 

commence in Nigeria. 

According to her; “blockchain 

technology is today being 

used in most of the developed 

worlds of America, Europe and 

Asia and it has not be utilised 

in Africa, so Fintech Worldwide 

is bringing it through a conference 

to be held in May in Lagos 

Nigeria, being the most populated 

and the country with the 

largest business opportunities 

on the continent. It is a fact that 

our population is increasing and 

we need to work faster and more 

efficiently. Last year, according 

to business insider, the number 

of Nigeria’s mobile subscribers 

has reached 150 million, and 

the number of its internet users 

has climbed to 97.2 million at 

penetration rates of 81% and 

53%, respectively. For context, 

Africa has 960 million mobile 

subscribers and 216 million internet 

users at penetration rates 

of 80% and 18%, respectively. So 

that it affects the applications 

and so a lot of people are not 

confident in using it”, Stephen 

Nejo, a banker at sterling bank 

told BusinessDay in a phone 

interview. 

The study measured the 

overall customer experience 

using mobile banking applications 

in 2018 while highlighting; 

customer engagement channels, 

conversion rate, mobile 

banking complaint resolution 

timeline, challenges faced using 

mobile banking applications, 

likelihood to recommend and 

areas for improvement. 

On overall satisfaction, users 

in this research communicated 

their satisfaction with 

their bank’s mobile banking 

application. 77% of users were 

satisfied, 16% indifferent and 

7% dissatisfied. 

Many believe that most 

banking apps can be hacked 

and their personal information 

and valuables can be stolen 

“Most people do not believe 

or trust in apps or transfer 

because of the fraud that 

happens when you get or 

send alerts from people or 

places that is not from the 

bank and also the bank apps 

features can be cumbersome 

boasting a thriving eco system, 

high rates of mobile penetration 

and an audience engaged in 

varying activities, Lagos is made 

for blockchain.” 

Explaining what blockchain 

really mean and how it works, 

Mekwuye said; “blockchain 

technology is an open, distributed 

ledger that can record 

transactions between two parties 

efficiently and in a verifiable 

and permanent way. For 

confidentiality most enterprises 

use a private blockchain where 

the ledger is only shared with 

nodes that have been cleared 

and validated it is an incorruptible 

digital ledger of economic 

transactions that can be 

programmed to record not just 

financial transactions but virtually 

everything of value.” 

At the event where blockchain 

experts, Yannis Kalfoglou, 

Muneeb Shah, Ryan 

Goutay spoke via Skype 

from Europe; Kalfoglou said; 

“Blockchain technology provides 

the answer to digital 

trust because it records important 

information in a public 

space and doesn’t allow 

anyone to remove it. It’s transparent, 

time-stamped and 

decentralized. Information 

held on a blockchain exists 

as a shared — and continually 

reconciled — database. This 

is a way of using the network 

that has obvious benefits. The 

for customers since they want 

it easy and fast”, Gboyega Olurankinse,” 

a banker said 

According to statistics from 

the Nigeria Inter-Bank Settlement 

System (NIBSS) data, the 

number of active bank accounts 

reduced by 1.5 million, dropping 

from 65 million in 2016 to 

63.5 million in 2017 

“It could imply that so many 

people don’t have bank accounts 

but the truth is that the 

future of banking is digital and 

mobile so they need to get use 

to these apps”, Dolapo Ashiru, 

chief executive officer, Mega 

Capital financial services limited 

said. 

Financial institutions and 

Internet service providers in 

Nigeria are encouraged to work 

towards improving user experience 

by focusing on the value, 

adoptability, usability and desirability 

of mobile banking 

applications. 

“The bank needs to enlighten 

their customers on the safety 

of the app and more awareness 

needs to be created. Nowadays 

you can transfer money from 

one account to another, credit 

your account with Airtime, pay 

bills etc .The apps are friendly 

are easy to use”, Nejo said 

blockchain database isn’t 

stored in any single location, 

meaning the records it keeps 

are truly public and easily 

verifiable. No centralized 

version of this information 

exists for a hacker to corrupt. 

Hosted by millions of computers 

simultaneously, its 

data is accessible to anyone 

on the internet.” 

In the same vein, Luis Carranza 

of Fintech Worldwide, 

London stated via Skype that 

blockchain “is a new technology 

that will provide essential 

usage in every area of life and 

business ranging from business, 

commerce and trade, entertainment, 

governance, tourism, agriculture, 

banking and finance, 

education, energy, human resources 

insurance among others. 

May 7 is definitely a date 

with Nigerians where all shall 

be revealed.” 

Fintech runs events across 

the globe including London, 

New York, San Francisco, Dublin, 

Amsterdam, Tel Aviv, Hong 

Kong and several other locations. 

Our flagship event, Fintech 

Week, has been running 

since 2014. In 2015 it started 

running Blockchain Conferences 

leading up to Blockchain 

Week. For 2018 and beyond, 

Fintech Worldwide is focusing 

on continued organic expansion 

in key tech and financial 

service hub across the globe. 

COMPANIES & MARKETS 

Business Event 

BUSINESS DAY 21 

L-R: Anthony Nsiah Asare, director general of Ghana Health Service presenting Innovation in 

Malaria Financing Award to Access Bank PLC representative, 

Omobolanle Victor-Laniyan, at the Malaria Safe Awards in Ghana. 

L-R: Idowu Adesokan, senior manager, high value segment, MTN, Rikki Stein, Fela Anikulapo-Kuti’s 

lifetime manager, Bolanle Austen Peters, producer, Fela and the Kalakuta Queens and Anthony 

Manjaro, Nollywood actor at the MTN Foundation sponsored Musical titled Fela and the Kalakuta 

Queens held at Terra Kulture Arena, Victoria Island, Lagos recently. 


L-R: Sade Onyia, management consultant; Kenechukwu David Nwafor, winner of the IT category; 

Mary Adenike Adeleye, winner of the PR category, and Damiloa Sobajo, general manager, Sesema 

PR, at the 3rd edition of Sesema PR’s Corporate Communications Pitch Competition in Lagos. 

L-R: Obi Brown, Insight Africa; Tayo Aduloju, senior fellow, Public Policy & Institutional Development, 

NESG; Toluleke Adenmosun, Managing Director, Financial Services, Accenture Nigeria; Niyi Yusuf, 

managing director of Accenture Nigeria and Ladipo Lawani, L&L Foods at the cocktail meeting of 

Accenture and 23rd Nigerian Economic Summit (NES23) Startup Pitch Winners in Lagos.


C002D5556 

BUSINESS DAY 

27 


CEO 

INTERVIEW 

MICHAEL CORBAT 

Chief Executive Officer of Citigroup 

Interview with Private Sector Leaders 

Citi lends helping hand to Nigerian banks eyeing global expansion 

Citi Group can offer local banks access to the global capital markets, and help them as they look to expand their business across Africa, according to CEO Michael 

Corbat, who sat for an exclusive interview with BusinessDay’s News Editor, PATRICK ATUANYA and senior analysts, BALA AUGIE and LOLADE AKINMURELE. 

How does Citi view itself 

in today’s global economy, 

especially since 

emerging from the financial 

crises? How 

does that role/vision translate 

into its African operations and 

Nigerian business specifically? 

Our restructuring is over and we are 

becoming an indisputably strong and 

stable institution, having evolved to 

become the world’s most global bank, 

with a revenue base that is well balanced 

across products and regions. 

We have passed an inflection 

point and are well positioned for 

growth at home and globally. 

Our strategy for Africa is an extension 

of our global strategy, which is 

delivering sustainable and client-led 

revenue growth by deepening our 

relationships with our existing clients 

on the continent. 

We want to be the world’s leading 

bank, based on a balanced business 

across our products and geographies, 

and we are well-positioned in terms 

of the evolving macro-economic and 

policy landscape in Africa. 

This strategy relies on the fact 

that we have a 98-country footprint, 

which is not just unique, but essentially 

impossible to replicate in today’s 

economic and regulatory environment. 

We’ve built this network by 

following our clients wherever they 

want to conduct business, including 

the faster-growing emerging markets. 

With a presence across 16 African 

countries, and coverage of 28 nonpresence 

countries on the African 

continent, our Institutional Clients 

Group is scaled to serve multinational 

companies, emerging African market 

leaders, governments, investors and 

ultra-high-net-worth households that 

rely on our unique global network, 

insights and local market expertise 

to meet their banking needs. 

This model results in over 50 

percent of our institutional revenues 

coming from highly recurring, stable 

businesses such as cash management, 

custody, private bank, corporate 

lending and flow-driven corporate 

foreign exchange. 

As for Nigeria, we have been present 

here since 1984, and are the oldest 

existing global bank in the country, 

with eleven ICG branches spread 

across the nation. 

With our global connectivity, 

broad product range and innovative 

solutions, Citi is the first port of call 

for complex and cross border transactions 

in Nigeria. 

We are well-positioned to assist 

in the implementation of economic 

reforms, including liability management 

and risk mitigation, and we 

continue to operate the largest, most 

advanced global payments network, 

seamlessly connecting our clients in 

Nigeria across more markets than any 

peer can offer. 

We aim to maintain and enhance 

our position as the provider of bespoke 

trade solutions, and are the natural 

partner for large local corporates 

seeking to expand geographically. 

We are focused on providing e- 

solutions to our clients, assisting them 

in creating electronic collections solutions 

in sectors including aviation, 

shipping and technology. 

Investors are currently worrying 

about the effect of central banks 

raising interest rates, and rising 

inflation. A lot of African nations 

have been racing to tap the dollar 

bond market this year before 

interest rates rise. How far will the 

Fed go in raising rates and what 

will it mean for the global economy? 

What could it also mean for 

commodity prices, particularly 

oil, which the Nigerian economy 

is heavily dependent on? 

On March 21, the Federal Reserve 

raised rates for the sixth time since 

December 2015. We expect two further 

rate hikes this year (for a total of 

three in 2018) and that the pace of rate 

hikes will remain gradual. 

While Citi economists expect 75 

basis points (bp) of hikes in 2018, we 

do think 100bp is a plausible scenario. 

It is worth noting that out of the March 

meeting, the Fed Funds long-run median 

rate moved up from 2.75 percent 

to 2.875 percent. 

Where this leaves the U.S. economy? 

While we think there may be faster inflation 

in 2018 and 2019, we anticipate 

that real GDP growth will accelerate 

to 2.8 percent this year, largely from 

benefits from the tax overhaul. 

Globally, we continue to predict 

robust global growth, even as downside 

risk increases. We forecast global 

growth for the remainder of 2018 of 

around 3.7 percent up from 3 percent 

in Q1. 

We are in the mature phase of 

this business cycle, both in the U.S. 

and globally. The low level of the 

unemployment and savings rates 

and the duration of the expansion 

have made us vigilant in monitoring 

recession risk. 

Regarding commodities, this 

sustained global economic growth 

should keep demand robust. 

At this moment, geopolitical uncertainties, 

as well as oil production 

growth, are likely to have greater 

impact on oil pricing than monetary 

policy. 

What is your take on the current 

debate over tariffs that the 

U.S President wants to impose 

on China and others? Is it just 

a symbolic gesture or this have 

the potential to truly take us into 

a global trade war? 

The Administration appears motivated 

by at least three factors and 

these are: 1-Protecting and creating 

U.S. jobs 

2-Reducing the U.S. trade deficit 

with certain countries 

And 3-Deterring or mitigating the 

impact of China’s economic model. 

As a global financial institution 

with a significant and diversified 

presence around the world, Citi has 

strongly supported free and fair trade 

and trade agreements that facilitate 

the movement of goods and services 

across borders while promoting 

broad-based economic growth. 

We are concerned about this 

rising protectionism and the risk of 

retaliatory trade measures, which 

would have a negative impact on 

global growth. 

While these are relatively narrow, 

we have to ask if it is just the beginning 

or will there be more because it 

significantly increases risk of a major 

escalation? We’ll have to wait and see. 

How can Citi be a partner to local 

firms in economies like Nigeria 

to tackle intractable problems 

such as structuring mortgages, 

infrastructure finance, health 

insurance, increasing financial 

inclusion and so on? 

Our network continues to be our biggest 

competitive advantage in ICG. 

Citi is the payment powerhouse in 

East Africa, processing over 10 million 

transactions annually and collecting 

over 20 percent of government taxes 

through our pipes. This technologydriven 

solution helps us maintain 

our position as the leading corporate 

bank in Kenya and East Africa and the 

trusted bank for large corporate and 

public sector clients 

In Nigeria, we continue to focus 

on innovative solutions, which are 

mostly first-of-their-kind in the market. 

Besides raising over US$12 billion 

for our Nigerian clients in the past 24 

months, this year, Citi Nigeria cleared 

the first FX futures trade in the local 

FX market. 

Digitization remains a global 

trend that is rapidly transforming our 

institutional business. We are working 

with governments around Africa 

to leverage technology to improve 

processes and efficiency, reduce costs and 

increase transparency. We are working in 

areas such as tax collections and pension 

contributions, among others. 

Citi also seeks opportunities to help address 

societal challenges that impact our 

clients and communities, including job 

creation and career readiness, affordable 

housing and protecting the environment 

through sustainable growth. 

In July 2017, Citi Nigeria extended a 

NGN500 million loan to Accion Microfinance 

Bank to drive and promote the 

development of the microfinance sector 

in Nigeria. This loan will fund Accion’s 

portfolio, and support the development 

of approximately 5,000 micro and small 

enterprises in the country. 

We are very active on the social agenda 

side as well. Recently, Citi Foundation 

awarded the International Rescue 

Committee (IRC) a $2 million grant in 

support of refugees and internally displaced 

people in the region. The two-year 

programme will create sustainable livelihoods 

for 1,000 displaced youth in three 

locations: Nigeria, Jordan and Greece; and 

will provide them with business start-up 

grants and mentorship after they successfully 

complete the training and demonstrate 

an ability to move their business 

ideas forward, and this will be carried out 

with the support of 60 Citi employees as 

volunteer mentors and business advisors. 

The bank set an efficiency ratio target 

of below 50 percent by 2020, and your 

last report showed that you recorded 

57.70 percent. Do you get the feeling 

that you are closing in on that target 

and how will it happen? 

What is important is to continue improving 

ahead of 2020. 

At current levels, we already have the 

best efficiency ratio among of our US 

peers, but we want to continue to push 

the edge. 

To achieve this, we believe technology 

has a part to play in helping out in terms 

of efficiencies, intelligence and voice recognition. 

And we see there is opportunity 

for us, as we have been doing, to continue 

to grow our revenues around the world. 

It will be a combination of revenue 

growth, spending discipline, reasonable 

cost of credit and the use of technology 

that will take us to where we need to be 

in 2020. 

What is the effect on your bottom-line 

of the slashing in the U.S top corporate 

tax rate from 35% to 21%? 

Yes, it affects us. We have very large deferred 

tax assets and as such when losses 

are made, the tax asset goes to the balance 

sheet as credit. 

As a result of tax reform, we rolled 

down about $20billion of those tax assets, 

which went back as an asset in the 

balance sheet and this resulted in lower 

tax and therefore brought about a higher 

net income. 

Citi’s shares have roughly doubled 

since you stepped into the top job 

in 2012. Citi’s market capitalization 

recently breached $200 billion for the 

first time since the crisis. You must 

be doing something right. Tell us 

how you see your global business 

evolving into the future? 

As we look to the future, our vision 

encompasses every part of the firm. 

We’ll continue to operate the 

largest, most advanced global payments 

network, seamlessly connecting 

our clients across more 

markets than any peer can offer. 

Beyond becoming the most 

important banking partner to 

more of our institutional clients, 

we have continued our shift away 

from brick-and-mortar branches 

to interact with our customers 

anywhere, anytime they need us 

through digital and mobile channels. 

We are benefitting from the 

long-term relationships that we’ve 

secured between our credit cards 

business and some of the world’s 

leading brands. 

Not only do we boast the best 

customer service as measured 

by Net Promoter Scores, having 

dramatically improved the client 

experience, we have re-established 

Citi as a leading aspirational and 

iconic brand in financial services. 

All of these support our commitment 

to deliver annual earnings 

power in the range of $20 billion 

within the next three years and 

the return of at least $20 billion in 

capital per year over the same time 

period. 

As we move forward, the foundation 

of all of our work is a deep 

commitment to who we are: a bank 

with a clear and stated mission of 

enabling economic growth and 

progress, and a singular focus on 

delivering for our clients and our 

shareholders. 

Does Citi have any consumer 

banking plans for Nigeria/Africa? 

The local banks across Africa today, 

Nigeria included, are highly sophisticated 

with excellent product 

offerings. 

Their digital product offerings 

are especially impressive. I don’t 

currently see an opportunity for Citi 

in the consumer banking market 

in Africa. 

Where I do see opportunity for Citi 

is in partnering with the local banks 

to help them, for example, further expand 

their product offerings as their 

target market becomes increasingly 

sophisticated. 

We can also offer the local banks 

access to the global capital markets, 

and help them as they look to expand 

their business across Africa. 

As for Citi, we have reduced our 

consumer footprint from over 40 

markets to 19 markets, with a focus 

on the US, Mexico and Asia. 

We believe these three markets 

are attractive and our scale and investments 

position us to capture additional 

market share as we put digital 

and mobile at the core of a simpler, 

better client experience. 

These markets have significant 

and growing revenue pools, where 

we can deliver our global capabilities 

at a local level to differentiate our 

franchise. 

What are the growth prospects 

for commodity-driven African 

economies? 

We continue to see growth across Africa, 

driven by the ongoing formation 

of a sizable middle class, continued 

trade momentum, good access to 

capital and a slow recovery in commodity 

prices. 

Real GDP growth in Sub-Saharan 

Africa in 2017 was in the 2.5-3 percent 

range, compared to 1.4 percent in 

2016. We think growth bottomed out 

in early 2017 after a difficult couple 

of years. 

Nigeria returned to positive 

growth in Q2 2017 and growth accelerated 

in the third quarter (Q3) 

and fourth (Q4). We expect further 

momentum in 2018, partly on the 

back of higher oil prices. 

We will be closely watching 

whether other countries in the region 

continue to push ahead with the types 

of necessary reforms we have seen 

in Nigeria, such as significant adjustments 

to exchange rates. 

We are hopeful that the bounce in 

oil prices since late 2017 will provide 

a more conducive environment for 

long-delayed reform, rather than the 

“bunker mentality” that seemed to 

pervade when prices were at their 

lowest levels. 

We find that the financial markets 

wallet tends to grow 1.5-2x the rate of 

GDP in developing markets, and we 

believe we are well positioned to grow 

our business in Africa, in support of 

our clients. 

What is your outlook for Nigeria’s 

economy? 

We continue to see encouraging 

economic reforms in countries such 

as Nigeria, among others. 

The reform program, which started 

here in 2016, has certainly helped 

to spur further economic growth and 

encouraged international investment 

in Nigeria. 

It also led to a significant contraction 

in Nigeria’s import bill, 

which quickly pushed the current 

account into surplus. 

Nigerian policymakers seem 

intent on following through with 

a series of reforms, which started 

with the naira flotation, and I am 

hopeful that we will see considerable 

exchange rate stability against 

the US dollar this year after the major 

devaluations in 2016 and 2017. 

In this context, the country has 

done well managing its finances by 

successfully tapping international 

capital markets in order to replace 

local currency debt. 

The government’s oversubscribed 

Eurobond issues speak volumes 

to the success of the country’s 

structural reforms, and highlight 

global institutional investor confidence 

in the Nigerian credit story. 

What is Citi’s role in facilitating 

south-to-south trade or investment 

flows? 

Supporting and facilitating global 

trade is in Citi’s DNA. 

We bank over 70 percent of 

the multinationals in Africa, and 

actively take Emerging Market 

Champions worldwide. In addition, 

we are the primary bank for trade 

finance, and crossborder payments. 

Balanced growth across the world 

economy means trade in every direction 

is poised to expand. 

Global initiatives, such as One 

Belt & One Road, have momentum, 

and promise to enhance trade from 

China to Nigeria. 

It is not just about trade finance, 

but also helping clients across a range 

of products including capital markets, 

lending, securities services, advisory, 

hedging FX and interest rates across 

different currencies and managing 

cash. 

Citi is present in 58 of the 65 Belt 

& Road countries – the most of any 

bank globally. 

Citi is also the runaway leader 

in Latin America, an increasingly 

robust trading partner for Africa. 

What is the outlook for African 

capital markets and M&A 

activity? 

DCM re-opened for African issuers 

in 2017, starting with sovereigns 

(Nigeria and Senegal), followed by 

banks (AFC, Zenith, and UBA) and 

eventually including corporates 

(Liquid Telecom). 

ECM was also strong, with some 

very successful transactions for 

South African names (Star and 

Sybane) and a strong 2018 pipeline. 

Citi is actively working with a 

number of sovereigns to refinance 

existing debt and in some areas 

address rising deficits (leading arranger 

of most recent bond issues 

from Nigeria, Kenya, Egypt). 

Apart from supporting the sovereign 

clients in tapping the debt 

capital markets (Ghana, Nigeria, 

Senegal, South Africa), we also 

made important relationship progress 

with regional development 

banks by leading the bond issues 

for BOAD (West African Development 

Bank) and TDB (Trade & Development 

Bank). 

We see renewed interest from 

strategic investors in African companies 

with GDP growth driven-stories, 

including Liquid Telecom buying 

Neotel, Kansai (Japan) buying Sadolin 

in East Africa, Fairfax Africa buying 

into Atlas Mara.


C002D5556 

BUSINESS DAY 

23 

Godwin Emefiele, Governor, Central Bank of Nigeria (CBN) 

CBN...protecting local manufacturers 

and ensuring price stability 

Since assumption of office, 

Godwin Emefiele, 

Governor, Central Bank 

of Nigeria (CBN) and 

his team at the apex 

bank have been working assiduously 

to protect manufacturers 

and ensure price stability. 

He has presided over the 

CBN at a very challenging period 

in Nigeria’s history where 

oil prices, the nation’s major 

source of revenues and FX suddenly 

plunged to new lows. 

In response to the dwindling 

capital inflows that resulted 

from lower oil prices, Emefiele 

introduced a number of measures 

to ensure that the country 

does not run out of FX while 

preventing a significant devaluation 

of the currency that could 

fuel runaway inflation. 

The introduction of the importers 

and exporters foreign 

exchange window (I & E) and 

suspension on importers of 41 

items from accessing FX in the 

official window stood out. Since 

the introduction of the I&E window, 

transactions worth over 

$20bn has gone through the 

window while the suspended 

41 items are estimated to have 

attracted more than US$10 billion 

in investments. Also notable 

is the CBN’s Anchor Borrowers’ 

Programme (ABP), which has 

led to a significant boost in local 

rice production, putting Nigeria 

on the path to self-sustainability 

in rice production. 

Prior to his appointment as 

the governor, he spent over 26 

years in commercial banking 

culminating in his tenure as 

Group Managing Director and 

Chief Executive Officer of Zenith 

Bank Plc, one of Nigeria’s largest 

banks with over 7,000 staff, 

about US$3.2 billion in shareholders’ 

funds, and subsidiaries 

in Ghana, Sierra Leone, The 

Gambia, South Africa, China, 

and the United Kingdom. 

Under Emefiele’s leadership, 

Zenith Bank strengthened its 

position as a leading financial 

institution in Africa, winning 

recognition and endorsement 

at home and abroad for giant 

strides in key performance areas 

like corporate governance, service 

delivery and deployment of 

cutting-edge ICT. 

Before his banking career, 

he was a lecturer in Finance 

and Insurance in two Nigerian 

Universities. Emefiele is an 

alumnus of Stanford University, 

Harvard and Wharton Graduate 

Schools of Business where 

he took courses in Negotiation, 

Service Excellence, Critical 

Thinking, Leading Change and 

Strategy.


CBN: Catalysing real sector development 

The Central Bank of Nigeria (CBN) displayed a rare corporate competence when it deployed extensive policies to redeem Nigeria from the vortex of 

recession which the nation plunged into following the sudden decline in crude oil prices at the international market. Presiding over the economy at a 

very challenging time, the CBN interventions into the economy provided the needed impetus for the economy to be out of the woods, writes TELIAT SULE 

The Nigerian economy has 

enjoyed a steady growth since 

the return to democratic governance 

in 1999. In those 

intervening years, average 

GDP growth rate was about 7 percent. 

Particularly in those years when the 

crude oil prices were significantly high, 

the health of the economy was robust 

particularly when measured in terms 

of exchange rate stability, considerable 

external reserves build-up which was as 

high as $50 billion, single digit inflation 

and the nation’s attractiveness to the 

international investing community. 

At this time, what most other energy 

dependent nations did was to plough 

back the excess proceeds from crude oil 

into the diversification of their economies 

through the promotion and development 

of the manufacturing, agroallied 

and other strategic sectors, with 

the aim of reducing the vulnerability of 

their nations to external shocks. 

Past administrations in Nigeria failed 

to utilise the opportunity that high crude 

oil prices offered us. The impact was 

that when crude oil prices began to fall 

steeply at the international market, there 

were no shock absorbers to insulate the 

Nigerian economy, and in a matter of 

months, exchange rate began to deteriorate, 

the three tiers of government 

were handicapped as revenues dwindled 

leading to civil workers being owed salaries 

for months and the development of 

infrastructure was completely put on 

hold in a country that ranks poorly in 

infrastructure development among 

emerging markets. 

Consequently, foreign exchange 

became a scarce commodity about 

which time it was exchanged at N520/$. 

For being dependent on raw materials 

importation, majority of the small and 

medium enterprises in the country had 

their capacity utilisation reduced to below 

average as they could sparsely raise 

the needed funds to buy forex. Some 

had to shut down operations when the 

situation became unbearable. 

In the aftermath, youth unemployment 

spiked leading to high rates of 

crimes, drug trafficking, human trafficking 

which caused a number of Nigerians 

to perish in the Mediterranean Seas. 

The foreign exchange market became 

fragmented and we had the official rate, 

black market rate, parallel market rate, 

Bureau de Change rate, among others. 

How did the CBN rise to the occasion? 

Ban on 41 non-essential items 

Given that Nigerians have penchant for 

anything imported, at the expense of 

local substitutes that are even better, 

Central Bank of Nigeria (CBN) set out to 

control this unbridled greed, which was 

causing the nation billions of dollars in 

foreign exchange. Thus in 2015, the CBN 

issued a circular: 

“In the continuing effort to sustain the 

stability of the foreign exchange market 

and ensure the efficient utilisation of 

foreign exchange and the derivation 

of optimum benefits from goods and 

services imported into the country, 

it has become imperative to exclude 

importers of some goods and services 

from accessing foreign exchange at the 

Nigerian foreign exchange markets in 

order to encourage local production of 

these items”, the CBN Circular dated June 

23, 2015 stated. 

“For the avoidance of doubt, please 

note that the importation of these items 

are not banned, thus importers desirous 

of importing these items shall do so using 

their own funds without any recourse 

to the Nigerian foreign exchange markets”, 

the circular added. 

The items are rice, cement, margarine, 

palm kernel/palm oil and vegetable oils, 

meat and processed meat products, 

poultry-chicken, eggs, turkey, private 

airplanes/jets, Indian incense, Tinned 

Every year, not 

less than 100,000 

bags of Lake Rice 

are sold in every 

festive season in 

Lagos State, and 

the periodic sale 

has run for two 

consecutive years 

fish in sauce (Geisha)/Sardines, cold 

rolled steel sheets, galvanised steel 

sheets, roofing sheets, wheelbarrows, 

head pans, metal boxes and containers, 

enamelware, steel drums, steel pipes, 

wire rods, iron rods, wire mesh and steel 

nails. 

Others are security and razor wire, 

wood practice boards and panels, wood 

fibre boards and panels, wooden doors, 

furniture, toothpicks, glass and glassware, 

kitchen utensils, tableware, tiles, 

textiles, woven fabrics, clothes, plastics 

and rubber products, cellophane wrappers, 

soap and cosmetics, tomatoes/ 

tomato pastes, and Eurobond, foreign 

currency bond/share purchases. 

Before the CBN was forced to take 

this step, Nigeria spent about $22 billion 

importing majorly four items which 

include rice, wheat, sugar and fish. This 

nation was world’s number two importer 

of rice estimated at about N356 billion, 

while N217 billion and N97 billion was 

expended importing sugar and fish respectively. 

Anchor Borrowers Program (ABP) 

launched 

The essence of the ABP was to create 

economic linkage between small-holder 

farmers and reputable large scale processors 

with a view to increasing agricultural 

output and the capacity utilisation 

of the processor. Topmost on the list of 

beneficiaries are farmer cooperative 

groups having between five and twenty 

members. And the targeted crops are 

cereals which comprise rice, maize 

and wheat; roots and tubers prominent 

among which are cassava, potatoes, 

yam and ginger; tree crops like oil palm, 

cocoa and rubber; legumes comprising 

soybean, sesame seed and cowpea, tomato 

and livestock (fish, poultry and 

ruminants). 

This has led to rice revolution in a 

number of states particularly Kebbi 

and Lagos; Ogun, Anambra, Kano, and 

Ebonyi. The rice revolution in Kebbi 

and Lagos led to the famous Lake rice, 

which is the result of partnership between 

the governments of Lagos and 

Kebbi States. In Kebbi State where the 

rice is grown, the provision of improved 

seedlings through the scheme, farm 

inputs and extension services have 

led to higher yield per hectare from 

2.5 to about 10 metric tonnes. Rice 

production involves 16 local government 

areas, with over 200,000 farmers 

providing direct and indirect jobs to 

the local economies of those local 

government areas. 

Every year, not less than 100,000 

bags of Lake Rice were sold in every 

festive season in Lagos State, and the 

periodic sale has run for two consecutive 

years. Because of the nature 

of Lagos State as a melting point for 

all tribes and religions, there are two 

major festive seasons which are Ileya 

(Sallah) and Christmas. That means, 

for the two festive seasons in every 

year, not less than 200,000 bags of Lake 

Rice would be sold. 

Furthermore, the last two years have 

seen the growth in the capacity utilisation 

of rice mills in the country. In 

Kebbi State for instance, Kamba Rice 

Mill in Dandi Local Government now 

produces 735 metric tonnes per annum. 

Labana Rice Mills also produces 

250,000 metric tonnes per annum 

while Wacot Rice Mill presently produces 

120,000 metric tonnes annually, 

but aims to expand capacity to 500,000 

metric tonnes per annum. 

The benefits of the ABP are immediate. 

Apart from creating over 88,000 

millionaires along the Lake Rice value 

chain; there was a sharp decline in rice 

importation, thereby saving the nation 

of the much needed foreign exchange 

to attend to the needs of manufacturers. 

The nation’s agric sector accounts 

for about 25 percent of the gross domestic 

product (GDP). Overall, it grew 

by 3.45 percent in 2017. But the growth 

varies from quarter to quarter. In the 

first quarter, it grew by 3.39 percent 

and that moderated to 3.01 percent in 

the second quarter. The third quarter 

saw the sector grow by 3.06 while in the 

last quarter of the year, it grew by 4.23


C002D5556 

BUSINESS DAY 

25 

and ensuring price stability 

percent. 

Policy boosts local sourcing of raw 

materials 

The restriction has encouraged more 

firms to source raw materials locally. For 

instance, Guinness Nigeria Plc sources 

75 percent of its raw materials locally. 

Nestle Nigeria Plc has equally joined the 

fray. Nigerian Breweries Plc is to source 

60 percent of its raw materials locally by 

2020. Procter and Gamble Plc have started 

sourcing a significant amount of its raw 

materials from local suppliers. 

This means the billions of dollars hitherto 

spent importing raw materials into 

the country is now being injected into the 

local economy, creating millionaires in 

those raw materials value chain. 

Investors and Exporters (I & E) Window 

boosts investors’ confidence 

The foreign exchange market was fragmented 

with several rates applicable in 

the market. In fact, stakeholders said if 

the regulatory authority did not intervene 

urgently, those unofficial rates would 

become official. 

As a responsive organisation, the 

CBN came out with an ingenious move 

christened as Investors & Exporters FX 

Window. “The Central Bank of Nigeria, in 

a continuing effort to deepen the foreign 

exchange market and accommodate 

all FX obligations, hereby announces a 

special window for investors, exporters 

& end-users (hereinafter referred to as 

“Investors & Exporters FX Window”. The 

purpose of this window is to boost liquidity 

in the FX market and ensure timely 

execution and settlement for eligible 

transactions” the CBN said through a 

circular dated April 21, 2017. 

As at the end of last year, transactions 

through the I & E window crossed $19 

billion, particularly through significant 

inflows from the offshore investors interested 

in treasury bills and primary market 

auctions (PMA) by the Central Bank of 

Nigeria (CBN). 

Based on the foregoing, the arbitrage 

opportunities to rent seekers have shrunk, 

as the parallel market rates converge to 

the official rate and volatility associated 

with foreign exchange transactions has 

slowed down. 

Furthermore, as the CBN succeeded 

in saving scare forex on unimportant 

items, this has led to a boost in foreign 

reserves which presently stands at about 

$46 billion. 

Capital importation surges 

The total capital importation into Nigeria 

in 2016 was $5.12 billion. With CBN 

ingenuity and confidence boosting policies 

and programs implemented, capital 

importation into Nigeria surged 139 percent 

to $12.23 billion by 2017 year end. 

In the real sector, inflows into the agric 

sector rose by 771 percent from $22.47 

million in 2016 to $195.65 million in 2017. 

Fishing industry witnessed 1,557 percent 

increase in capital importation from $6 

million in 2016 to $99.43 million in 2017. 

The nation’s tanning industry which was 

almost dead started showing signs of revival 

as investors injected $520,000 into 

the sector. 

In terms of FDI, the President and 

Commander-in-Chief of the Armed 

Forces, Muhammadu Buhari, commissioned 

the largest integrated feed mill 

in Kaduna State owned by Olam Nigeria 

Limited. The project cost $150 million to 

set up. When fully operational, the mill 

will process 180,000 tons of corn, 75,000 

tons of soybean, 360,000 tons of animal 

feeds annually and 1.6m day old chicks 

weekly. In addition, the project has the 

capacity to employ about 600 workers 

directly and 400,000 workers indirectly. 

By the second quarter of 2017, the 

Nigerian economy responded to those 

ingenious moves leading to the exit from 

recession. In that quarter, the GDP growth 

was 0.72 percent. It improved to 1.40 percent 

at the end of the third quarter and 

ended the year with 1.40 percent growth 

in GDP. 

CBN options for sustaining the 

growth momentum 

Nigeria is blessed with large arable land 

of which only a small portion of it is 

under cultivation. Therefore, with high 

youth unemployment, it will not be out 

of place to advise Nigerians particularly 

the youths to take interest in agriculture. 

Interestingly, a lot of successful Nigerians 

have emerged in this sector in the last one 

and half years. 

Here, we take a look at some of the 

agric and agro-allied areas where millionaires 

have recently emerged. 

Rice Farming: This is one area the 

CBN has vigorously supported in the 

last few years. Rice is a major staple food 

in Nigeria, and before the new agric 

revolutions, Nigeria spent about $2 billion 

importing rice annually. We have 

the upland rice; rain fed low land and 

irrigated rice. With improved yields per 

hectare, a farmer could harvest between 

0.7 to 1 tonne per hectare for upland rice. 

It is between 2 and 2.5 tonnes per hectare 

for upland rice while it is between 3 and 4 

tonnes per hectare for rice grown through 

irrigated system. 

Given the enormous opportunities 

in rice farming, the CBN introduced 

the Anchor Borrowers’ Program (ABP). 

Launched on November 17, 2015, the 

program is intended to create a linkage 

between anchor companies involved in 

the processing and small-holder farmers. 

Some of its objectives include: to 

increase banks’ financing to agricultural 

sector; reduce agricultural commodity 

importation and conserve external reserves; 

increase capacity utilisation of 

agricultural firms; create new generation 

of farmers and entrepreneurs and employment; 

deepen the cash-less policy 

and financial inclusion; reduce the level 

of poverty among small-holder farmers; 

and assist rural small-holder farmers 

to grow from subsistent to commercial 

production levels. 

As at the end of 2017, over 500,000 

farmers have benefited across the States 

of the Federation, and more farmers are 

going to be engaged. 

Maize farming: Maize industry in Nigeria 

is valued at $6 billion. The produce 

is a must have for poultry farmers and 

manufacturers. Supply of maize is about 

7 million metric tonnes whereas demand 

is 7.5 million metric tonnes. Demand 

for maize is consistently high due to the 

large poultry industry. Gestation period 

of maize is about three months and with 

new improved yields, a farmer can be 

sure of considerable yield per hectare. 

Multinational corporations such 

as Nestle Plc, Nigerian Breweries Plc, 

Guinness Nigeria Plc, Cadbury Plc, Flour 

Mills Plc, etc., have started sourcing raw 

materials locally. Cereals happen to 

be one of the major raw materials for 

these companies. With poultry industry 

expanding daily while manufacturing 

giants such as the aforementioned companies 

competing for the same cereals, 

you can be sure that there is ready made 

market for maize in Nigeria. The good 

news is the CBN programs help farmers 

to get improved seedlings and finance. 

Fishery: The catfish subsector of 

the Fishery industry in Nigeria is worth 

about N175 billion as the nation currently 

produces catfish about 370,000 

metric tonnes. This is another area of 

agriculture unemployed youths have 

made millions of naira by dint of hard 

work. The CBN’s ABP covers it as well. 

In 2017, catfish farmers in Delta State 



CBN: Catalysing real sector development... 


were supported through a soft loan of 

N1.2 billion. 

In addition to local consumption, 

catfish farmers have started exploring 

the international markets. According to 

the study sponsored by the Food and 

Agriculture Organisation (FAO) of the 

United Nations, the quantity of dried and 

smoked catfish, tilapia and other types of 

fish from the West African region to the 

United Kingdom was worth 500 tonnes 

per year estimated at about $20 million. 

Cassava: For domestic and industrial 

uses, cassava is one of the most consumed 

foodstuffs in Nigeria and sub Saharan Africa. 

According to the National Bureau of 

Statistics (NBS), expenditure on cassava 

amounted to 23 percent of consumption 

expenditure and 15 percent of the total 

expenditure on consumption, which is 

about N24 trillion. The CBN also supports 

farmers who show interest in cassava 

farming. 

Cotton: Cotton used to be one of the 

major non-oil exports until the agricultural 

sector was abandoned during the 

oil boom, and that led to the collapse of 

all the textile mills in the country which 

then were majorly situated in Lagos and 

Kaduna States. The CBN is determined 

to bring back the good old days in the 

nation’s cotton industry through its intervention 

programs. 

The Central Bank of Nigeria (CBN) 

is interested in this segment of the agriculture 

value chain because between 

2014 and 2017, over N400 billion worth 

of textile and textile articles were imported 

into the country. In 2014, a total of 

N106.11 billion worth of textile and textile 

articles were imported. In 2015, the value 

of imported textile related materials fell 

to N92.17 billion. In 2016, it further rose 

by 24 percent to N114.7 billion and with 

another 24 percent increase, the value of 

imported textile materials rose to N141.99 

billion in 2017. 

On the contrary, the export of textile 

and textile related articles which stood at 

N145.41 billion in 2014 fell sharply by 97 

percent to N4.20 billion in 2015 and has 

since remained at that level. In 2016 the 

export of textile related materials earned 

Nigerian farmers and other players in that 

value chain just N5.47 billion and in 2017, 

it was N5.86 billion. The intervention of 

the CBN is beginning to rekindle interest 

in the sector. This is so because since 2016, 

the sector has recorded quarter-on-quarter 

and year-on-year GDP growth rates. 

The motive of the CBN is to get farmers 

interested in cotton production once 

gain. Success in this regard will make raw 

materials readily available to textile mills 

and the final products will be competitive. 

The immediate impact will be a reduction 

in the textile related materials import bill 

and a boost to exchange rate stability. 

Reducing the import bill of textile related 

materials by 25 percent will amount 

to Nigeria saving about N28 billion annually, 

and this is what the players in the 

cotton value chain will make as revenue. 

Let us that assume an average player 

makes N10 million as revenue annually, 

and with the CBN’s move to revive the 

cotton industry, the effort will create at 

least 2,823 millionaires annually. 

Palm produce: 

Palm oil is the most consumed vegetable 

oil as it accounts for 34 percent of the 

global vegetable oils production. Apart 

from crude palm oil (CPO), several other 

products such as palm kernel cake used 

in feed mill industry and other variants 

of vegetable oils used in soap making, 

food and beverages, and cosmetics industry 

are derived from oil palm trees. 

In 2016/2017 farming season, 177 million 

metric tonnes of vegetable oils were 

produced. Durfil, the maker of indomine 

noodles; Nestle, Cadbury, Honeywell 

Flourmills, Dangote Flour Mills, etc use 

vegetable oils a lot. 

In spite of palm tree being a traditionally 

West African produce, Nigeria occupies 

the fifth position globally in CPO 

production after Indonesia, Malaysia, 

Thailand and Columbia. Meanwhile, 

expansion in the food and beverages, 

cosmetics and soap making industry has 

created a demand-supply gap which is 

being filled now by CPO producers from 

Indonesia and Malaysia. In fact, the largest 

producer in Malaysia, Sime Darby 

Berhad is about to set up its plantation in 

Nigeria. In 2016, the company cultivated 

1 million hectares of land and realised 

$11.2 billion as revenue. 

With growing population and unification 

of West African economies through 

trade treaties, more CPO will be required 

as investors tap the opportunities the 

young population presents. This is the 

reason the CBN is supporting the cultivation 

of palm oil plantation. 

Soybeans: 

Advancement in research has led to the 

development of improved varieties of 

soybeans in Nigeria suitable for many 

ecological zones. The importance of 

soybean cannot be overemphasized as it 

contains about 40 percent protein content, 

20 percent edible vegetable oil and 

a balance of amino acid. 

Apart from industrial uses, the domestic 

market for soybeans is so huge because 

most of the diets consumed in the country 

are deficient in protein, and consumption 

of soybeans provides a cheaper alternative 

to millions of Nigerians. The crop 

is harvested at most four months after 

planting. 

This implies that with good farming 

practices and improved seeds, a farmer 

can harvest soybeans three times in a year. 

The market demand for soybean is estimated 

at N300 billion and presently a 75 

percent demand gap, translating to about 

N225 billion exists in the market place.



This is M NEY 

A daily guide to your Personal Finance 

• Savings 

• Travel 

• Debt & Borrowing 

• Utilities 

• Managing your Tax 

Will your money last 

as long as you do? 

For how long do 

you expect to 

live? It’s anybody’s 

guess but 

seriously, lifespans 

are steadily increasing 

and building a nest egg 

for your retirement is only 

one aspect of retirement 

planning; the other important 

aspect, is ensuring 

that those savings you 

have been accumulating 

over decades, actually last 

at least as long as you live. 

One of the greatest 

challenges to financial 

security is the transition 

from earning regular income 

and accumulating 

assets to actually drawing 

down on those hardearned 

assets over what 

could end up being almost 

a third of your lifetime, 

with improved healthcare, 

diet, exercise and education. 

As we continue to hope 

and pray for long life and 

prosperity, we must consider 

the “risk” of longevity 

and its implications for 

retirement planning. With 

medical advances, it is increasingly 

possible that today’s 

healthy 60-year-olds 

may live well into their 

90s and beyond. In some 

countries there are calls 

to increase the retirement 

age to 65 or even 70. 

Withdrawal risk keeps 

many retirees awake at 

night, as they must determine 

how much they 

can realistically afford to 

draw down from personal 

savings and investments 

without seriously depleting 

their capital. The rate 

values after say 20 years. 

Some of these scenarios 

assume 100% cash, 100% 

bonds, 100% stocks along 

with 25/75, 50/50 and 

75/25 mixes. 

One rough rule of 

thumb is the “100 minus 

age” rule, which suggests 

that you subtract your age 

from 100: The result is the 

percentage of your assets 

to allocate to stocks; 

this means a 65-year-old 

should retain only 35% of 

his or her money in stocks; 

this could put a retiree at 

risk. 

An investment strategy 

that is too conservative 

can be just as dangerous 

as one that is too aggressive, 

as it not only exposes 

your portfolio to the effects 

of inflation but also 

limits the long-term upside 

potential that stock 

market investments offer. 

If you are too aggressive 

about cutting exposure to 

stocks too soon, you could 

hinder the growth of your 

nest egg and this could 

leave you with less than 

you need. 

Yet as you approach retirement, 

you badly need 

growth and have so much 

to lose if there is a prolonged 

bear market. Being 

too aggressive can mean 

assuming too much risk 

in volatile markets. Nowadays 

one is encouraged to 

continue to retain stocks 

and stock mutual funds 

in a portfolio to have any 

prospects of long-term 

growth. 

The “artificial” deadline 

that retirement appears 

to present is becoming 

less practical and should 

not be what rigidly drives 

planning decisions. What 

is thus required, is a strategy 

that seeks to keep the 

growth potential for your 

investments without assuming 

too much risk. 

After an “official” retirement 

age of 60, there is a 

real possibility that you 

may need 30 more years 

of retirement income and 

the ideal should be to find 

a balance between growth 

and capital preservation. 

Can you afford to retire 

at the traditional age of 

60? The truth is that most 

people can’t. In your fifties, 

it is already becomat 

which you withdraw 

money from your assets is 

one of the most important 

factors affecting how long 

they will last. If you underestimate 

your needs, your 

money could run out too 

soon leaving you unable to 

live the standard or quality 

of the lifestyle you envisaged, 

or leave you dependent 

on your children 

or other relatives. 

For years, financial advisers 

have presented the 

4% rule for retirement, 

which is a rough guide 

for portfolio withdrawals 

in retirement. The basic 

premise is that you withdraw 

a conservative 4% to 

5% of your portfolio in the 

first year of retirement and 

then every year afterwards 

you withdraw the amount 

you took out the previous 

year with an inflation adjustment. 

Many investors end 

up withdrawing well over 

10% of their portfolio each 

year to support the lifestyle 

they have become 

accustomed to. Indeed 

many people spend more 

in their early years of retirement 

when they travel 

and “enjoy the fruits of 

their labour.” This can rapidly 

deplete that portfolio. 

However, even though this 

initial outlay can seem a 

little worrisome initially, 

it does tend to even out in 

later years.3 

Others are very pessimistic 

and scared of the 

prospect of being dependent 

on family in their later 

years and after building a 

portfolio of Certificates of 

Deposit, Bonds and dividend 

yielding stocks only 

withdraw interest and dividends 

and are too scared 

ever to touch principal or 

liquidate stocks; this also 

has implications for their 

living standards. 

So what is a safe withdrawal 

amount? It is virtually 

impossible to give 

precise guidance as to 

how much you can afford 

to spend from your 

savings in any given year; 

no simple solution exists 

and investors’ withdrawal 

rates will vary from person 

to person and according to 

the vagaries of the markets 

and their particular needs. 

Clearly there are many 

considerations to be taken 

into account including, 

your age and health, the 

overall size and composition 

of your retirement 

portfolio, your objectives, 

your spending pattern and 

lifestyle, and the fluctuation 

of your investment returns, 

the impact of inflation 

and the exchange rate 

on your assets and cost of 

living. Retirees must naturally 

be cautious particularly 

where portfolios are 

not well diversified and investments 

underperform 

for long periods and interest 

rates remain relatively 

low. 

Developing a plan for 

this spending phase can 

be difficult, as obviously 

no one knows how long he 

or she might live. It is important 

to seek professional 

advice to plan with the 

appropriate timing that 

makes sense given your 

overall goals and your own 

unique situation. 

In the past, conventional 

wisdom was to begin to 

divest from stocks as one 

approaches retirement, 

and then migrate to bonds 

and cash as safer guaranteed 

investments, stocks 

being volatile in the short 

term. Several studies have 

been carried out using 

various portfolio compositions 

to see what withdrawal 

rates would leave 

portfolios with positive 

ing clear whether or not 

you have enough money 

to last a lifetime and then 

some. If you know that you 

aren’t ready for retirement 

financially or otherwise, 

then you will simply have 

to work for longer than 

planned, and its time to 

think of what you will be 

doing in the years ahead. 

The generation approaching 

retirement age, 

have to a large extent redefined 

the traditional view 

of retirement; they are 

radically reshaping societies 

views of how “older” 

people are supposed to 

behave. From the traditional 

view of relaxation, 

leisure, and comfort, it is 

a time for renewal, growth, 

new opportunities, selffulfillment 

and brand new 

challenges. But this does 

need planning. 

Nimi Akinkugbe has extensive 

experience in private 

wealth management. 

She seeks to empower 

people regarding their finances 

and offers frank, 

practical insights to create 

a greater awareness and 

understanding of personal 

finance. 

For more personal finance 

tips, contact Nimi: 

Instagram and Twitter: @ 

mmwithnimi, 

Facebook and Google+: 

‘Money Matters with 

Nimi’. 

www. 

moneymatterswithnimi. 

com, or send us 

an email info@ 


com 

Nimi Akinkugbe has 

extensive experience 

in private wealth 

management. She seeks to 

empower people regarding 

their finances and offers 

frank, practical insights to 

create a greater awareness 

and understanding of 

personal finance. 

For more personal finance 

tips, contact Nimi: 

Email: info@ 

moneymatterswithnimi 

Website: www. 


com 

Twitter: @MMWITHNIMI 

Instagram: @ 

MMWITHNIMI 

Facebook: 

MoneyMatterswithNimi


BUSINESS DAY 

Cowry Weekly Financial Markets Review & Outlook 

29 

ECONOMY: Business Activities Expand Faster in March 2018 

as MPC Retains Policy Rates… 

Recently released Purchasing Managers’ Index (PMI) survey report for March 

2018, showed faster expansions in both the manufacturing and non-manufacturing 

businesses. The latest survey results also reinforced the fact that business optimism 

about the economy was stronger than it was a year ago. The faster expansion in PMI 

could be attributed to the seasonal pick up in the economic activity observed in the 

month of March. According to the survey, the manufacturing composite PMI stood 

at 56.7 index points in March 2018 (faster than 56.3 index points in February 2018), 

the twelfth consecutive expansion. The increase in manufacturing composite PMI 

was driven by faster expansion in new orders, to 56.1 in March 2018 (compared to 

55.6 in February 2018); faster expansion in production level to 59.1 in March 2018 

(from 57.8 in February 2018); and faster expansion in purchase of raw materials/ 

inventories to 59.4 in March 2018 (from 58.1 in February 2018). However, a slower 

expansion in supplier delivery times to 56.6 was recorded in March 2018 (from 57.0 

in February 2018). Further analysis showed that input prices in March 2018 slowed 

to 61.1 (from 65.4 in February 2018), occassioned by increased completion of the 

backward integration projects by the corporate entities which was propelled by 

Federal Government policies. This has helped in lowering selling prices as the output 

prices slowed m-o-m to 52.1 index points from 55.9 index points in February 2018. 

On the flip side, New exports orders declined faster to 36.4 in March 2018 (from 

42.0 in February 2018). Meanwhile, the non-manufacturing sector extended its 

advance but at a faster pace as the non-manufacturing composite PMI increased 

to 57.2 in March 2018 (from 56.1 in February 2018), the eleventh consecutive 

expansion. This was partly driven by faster expansion in business activity and 

incoming business to 58.7 in March 2018 (higher than 55.6 in February 2018) and 

55.8 (higher than 53.7) respectively. Other notable improvements were the new 

exports orders that recorded slower contraction to 39.0 in March 2018 (from 34.7 in 

February 2018) and imports that declined faster to 38.5 in March 2018 (from 39.1 in 

February 2018). Elsewhere, at the end of the 2-day policy meeting of the Monetary 

FOREX MARKET: Naira Appreciates against USD for Most 

Dated Forward Contracts… 

In the week under review, the local currency appreciated week-on-week (w-o-w) 

against the U.S. dollar at the Investors & Exporters Forex Window (I&E FXW) by 

0.05% to close at N360.01 amid weekly injections by Central Bank of Nigeria (CBN) 

of USD210 million into the foreign exchange market; of which USD100 million was 

allocated to Wholesale (SMIS), USD55 million was allocated to Small and Medium 

Scale Enterprises and USD55 million was sold for invisibles. Elsewhere, the Naira/ 

USD rate remained unchanged at the interbank foreign exchange market, the parallel 

(‘black’) market and the Bureau De Change segments at N330.00/USD, N362.00/ 

USD and N360/USD respectively in line with our expectation. Meanwhile, all dated 

forward contracts at the interbank over-the-counter (OTC) segment appreciated 

– spot rate, 1 month, 2 months, 3 months and 6 months contracts fell by 0.02%, 

0.07%, 0.13%, 0.23% and 0.40% to close N305.60/USD, N363.73/USD, N367.62/ 

MONEY MARKET: NIBOR Falls for All Maturities amid 

FAAC Inflows Worth N647 billion… 

In the week under review, Central Bank of Nigeria (CBN) auctioned treasury 

bills worth N95.20 billion via the primary market; viz: 91-day bills worth N9.52 

billion, 182-day bills worth N17.60 billion and 364-day bills worth N68.08 billion. 

Their respectively spot rates fell to 11.75% (from 11.95%), 12.70% (from 13.00%) 

and 13.04% (from 13.15%). Also, T-Bills worth N748.69 billion were sold via Open 

Market Operations (OMO). The outflows were partly offset by inflows worth 

N528.90 billion in matured treasury bills. Nevertheless, NIBOR fell for all tenor 

buckets amid FAAC inflows worth N647 billion: NIBOR for overnight, 1 month, 3 

months and 6 months tenor buckets fell w-o-w to 4.56% (from 7.6%), 14.64% (from 

14.85%), 15.28% (from 16.01%) and 17.06% (from 17.79%) respectively . Elsewhere, 

NITTY fell for most maturities tracked on renewed bullish activity: yields on the 3 

months, 6 months and 12 months maturities fell to 13.61% (from 14.43%), 14.31% 

(from 14.97%) and 14.90% (from 15.01%) respectively; however, yield on the 1 

month maturities rose to 14.09% (from 13.40%). Meanwhile, Standing Lending 

Facility (SLF) fell w-o-w by 18.38% to N233.58 billion while Standing Deposit Facility 

BOND MARKET: FGN Eurobonds Prices Appreciate in 

Value Across All Maturities Tracked… 

In the week under review , FGN bonds traded at the over-the-counter (OTC) 

segment rose for most maturities tracked. The 10-year 16.39% FGN JAN 2022 

debt, the 7-year 16.00% FGN JUN 2019 debt and the 5-year, 14.50% FGN JUL 

2021 debt appreciated in value by N0.33, N0.12 and N0.40 respectively; their 

corresponding yields fell to 13.50% (from 13.62%), 13.79% (from 13.92%) and 

13.73% (from 13.89%) respectively; while the The 20-year, 10% FGN JULY 2030 

debt decreased in value by N0.57 and its yield rose to 13.68% (from 13.65%). 

Meanwhile, FGN Eurobonds traded on the London Stock Exchange appreciated 

in value for all maturities tracked – the 10-year, 6.75% JAN 28, 2021, the 5-year, 

5.13% JUL 12, 2018 and the 10-year, 6.38% JUL 12, 2023 increased in value by 

N0.57, N0.01 and N0.66 respectively; their corresponding yields fell to 4.56% 

(from 4.78%), 4.63% (from 4.71%) and 5.13% (from 5.28%) respectively. At the 

OTC market, we anticipate bullish activity with resultant price increase amid 

expectation of boost in liquidity. 

Policy Committee (MPC) on Wednesday, April 4, 2018, the Committee voted to 

retain all rates – Monetary Policy Rate (MPR) at 14% with the asymmetric corridor 

at +200 and -500 basis points around MPR, Cash Reserve Ratio (CRR) at 22.5% 

and Liquidity Ratio at 30%; thus, prioritizing its non-expansionary policy stance 

above real output growth consideration. Amongst other positive considerations 

mentioned by the Committee were the favourable domestic developments and 

positive outlook for 2018 amid foreign exchange stability and strong global crude 

oil prices. However, the MPC noted risk to domestic developments to include low 

level of credit to private sector which is a constraint to real sector growth, rampant 

herdsmen attacks, near-term electioneering spending and rising yields in advanced 

economies while it also urged the quick passage of the 2018 budget in order to 

stimulate economic activity. We opine that in order to justifiy a downward review of 

the policy rate, inflation rate would have to moderate sufficiently below the 14.33% 

February 2018 reading while external reserves would have to be at a reassuring 

level. However, potential inflationary pressure due to near-term political spending 

remains a threat, thus necessitating a cautious stance by the monetary authority. 

USD, N371.41/USD and N385.55/USD respectively. This week, we expect stability 

in exchange rate amid further accretion to the external reserves as global oil prices 

retain its upbeat and CBN continues with the weekly intervention. 

(SDF) increased w-o-w by 276.32% to N618.20 billion; indicative of excess financial 

system liquidity. This week, treasury bills worth N476.21 billion will mature via 

both primary and secondary market, hence we expect boost in financial system 

liquidity with attendant moderation in interbank rate. This, however, should 

warrant increased OMO auctions in order to mop up excess liquidity. 

EQUITIES MARKET: The Nigerian Equities Market Falls by 

1.60% on Renewed Bearish Activity… 

In the just concluded week, the local bourse fell by 1.60% on profit taking 

activity as all the sectored sectored guages closed in the red territory. The twin 

market performance measures, NSE ASI and market capitalisation closed lower at 

40,841.14 points and N14.75 trillion respectively. The NSE Banking, NSE Insurance, 

NSE Consumer Goods, NSE Oil/Gas and NSE Industrial Indexes fell by 1.33%, 0.07%, 

1.73%, 2.27% and 2.09% to close at 513.67 points, 150.98 points, 978.14 points, 337.37 

points and 2,146.20 points respectively. Elsewhere, Naira votes and transacted 

volumes increased w-o-w by 59.56% and 14.55% to N26.56 billion and 1.76 billion 

shares respectively. On the sidelines of trading activities, FCMB Group Plc (FY Dec 

31, 2017) recorded a 3.67% decrease in revenue to N169.88 billion as well as a 34.37% 

decrease in profit after tax to N9.41 billion. The company also proposed a cash 

dividend per share of N0.10 which translated to a dividend yield of 4.26% based on 

Friday’s closing share price of N2.35. This week, we expect cautious trading activity 

in the market as investors await the first quarter results. 

POLITICS: Buhari Approves USD1 billion to Fight 

Insecurity Across the Country… 

In the just concluded week, President Muhammadu Buhari, following 

a meeting with the Minister of Defence, Colonel Mansur Dan-Ali and the 

security chiefs in Abuja, on Wednesday, April 4, 2018 approved the release of the 

controversial USD1 billion fund from the Excess Crude Account (ECA) for the 

purchase of military equipment. The approval was reportedly deemed necessary 

after discussions bordering on the increasing series of insecurity across the 

country. The decision to deplete the ECA followed an earlier recommendation 

by the National Economic Council (NEC) in December 2017, presided over by 

the Vice-President, Professor, Yemi Osinbajo, where the Nigerian Governors’ 

Forum (NGF), comprising Governors of the 36 states of the Federation, consented 

to the withdrawal of the USD1 billion from ECA in order to prosecute the fight 

against insurgency in the North-east. The ECA stood at USD2.317 billion as at 

December 13, 2017. However, President Buhari’s approval for withdrawal of the 

fund was resisted by other stakeholders who argued that the ECA belonged to all 

three tiers of government and would require the 36 state Houses of Assembly to 

consent to the withdrawal of monies from the ECA by the Executive. Ekiti State 

Governor, Ayodele Fayose, also challenged the modalities for approval, noting 

that it will be against the principle of federalism for the President, being just one 

of the federating units, to approve spending of money belonging to the three tiers 

of government. Corroborating Governor Fayose’s stance, the Vice Chairman of the 

Senate Committee on Media and Publicity, Senator Ben Murray-Bruce, stated that 

the presidency does not have the power to approve such amount of money but can 

only recommend for approval by the National Assembly. Meanwhile, the military 

gave re-assurance that the fund would be used for training, recruitment and 

purchase of equipment. We support investments in the security equipment and 

facilities as well as intelligence gathering in order to forestall attacks on soft targets. 

Moreover, we believe the fight against insecurity in the country should take a multipronged 

approach aimed at educating and empowering the youths to prevent 

delinquent behavior in the society or being deployed as feedstock by terrorists. 

Disclaimer 

This report is produced by the Research Desk of Cowry Asset Management 

Limited (COWRY) as a guideline for Clients that intend to invest in 

securities on the basis of their own investment decision without relying 

completely on the information contained herein. The opinion contained 

herein is for information purposes only and does not constitute any offer 

or solicitation to enter into any trading transaction. While care has been 

taken in preparing this document, no responsibility or liability whatsoever 

is accepted by any member of COWRY for errors, omission of facts, and any 

direct or consequential loss arising from the use of this report or its contents. 

Cowry Weekly Stock Recommendations As At Friday 06 April 2018 

Cowry Asset Management Limited (Member of the Nigeria Stock Exchange) 

Plot 1319 Karimu Kotun, Victoria Island Lagos Tel: +234-1-2715008-9; +234-1-2716614-5 www.cowryasset.com



FEATURE 

New import duty on solar panels: 

How Nigeria preys on dreams 

The new 10 percent tariff on solar panels will wreck havoc on Nigeria’s clean energy ambitions, limit 

energy access for over 85 million people while running aground small businesses, writes ISAAC ANYAOGU. 

On any given day, 

Femi Adeyemo, a cofounder 

of Arnergy 

Solar Limited is about 

as calm as a clear evening 

after a windy rain, but not on 

March 26. Over the phone, his voice 

reeked of pain, disappointment 

oozed out of every pore on his skin, 

so real, you could feel it. 

“How could they do this? Just 

what kind of country is this?” 

He was reacting to a rash decision 

by the Nigerian Customs Service 

to impose a five percent duty 

and a five percent Value Added Tax 

(VAT) on solar panels coming into 

Nigeria. Those affected weren’t informed 

and the existing regulation 

was ignored, just a brutal exercise 

of discretion long starved of reason. 

Perhaps, if you imported products 

worth over N40 million after 

securing funding from an international 

development agency, when 

your business model demands 

recouping investments after two 

years from retail sales, and dreams 

of fantastic profits are as sure as a 

silver rain, you would understand 

the pain. 

For many solar operators in 

Nigeria, this is the reality. The odds 

are stacked against them to begin 

with. Solar infrastructure is insanely 

expensive because batteries already 

suffer a 20 percent duty. 

Many people mistrust its efficacy, 

as shards of failed solar street lighting 

projects, executed by politicians litter 

major Nigerian cities. Solar is still 

the best ruse to raid the public till. 

Concerns about its reliability during 

rainy weather and ability to power 

heavy electrical appliances like air 

conditioners are real. 

On the operational side too, upfront 

cost for constructing a 200kW 

solar diesel hybrid minigrid can exceed 

$2million. Annual cost for operation 

including customer service 

and overhead can exceed $100,000. 

Commercial debt for minigrids in 

sub-Saharan Africa when available, 

is typically above 15 percent. 

However, you would think that 

a country that has over 85 million 

without energy access and aspires 

to achieve the United Nations Sustainable 

Goals on energy will get 

creative about unlocking energy 

access for its people. Nigeria has a 

way of making your worst fears, look 

like annoying trivia. 

Grave implications 

This duty imperils rural folks the 

most, who are failed by governments 

that are distant and indifferent. Nigeria’s 

budding solar market valued 

at over N18bn according to operators, 

employing over 10,000 people 

will grind to a halt. Yet solar panel 

is exempted from duties according 

to Nigeria’s HS Codes classification. 

The Nigerian Customs Service 

arbitrarily decided to use a classification 

(85013300) meant for Direct 

Current (DC) Generators with movable 

parts rather than the normal 

85414000 classification hitherto 

used for solar panels which attracts 

zero duty. 

Consequently, discharge of containers 

from the ports has been 

hampered and demurrage charges 

have risen for our members says Segun 

Adaju, president of the Renewable 

Energy Association of Nigeria 

(REAN), a trade group of operators 

in the country, at a press briefing 

organised in Lagos, on March 28. 

“This has grave implications 

for Nigeria’s quest to improve the 

ease of doing business and deepen 

Solar panels attract zero duty in Nigeria 

energy access for over 70million 

people with inadequate access to 

power,” said Adaju. 

This new tariff will accelerate value 

destruction within the industry, 

cause prices to rise to uncompetitive 

levels for rural dwellers and negates 

Nigeria’s clean energy ambition. 

“This arbitrary imposition of 

import duty will destroy our business 

model. We have modelled costs 

based on the absence of an import 

duty only for our products to arrive 

and suddenly we are slammed with 

10% import duty. How do we recover 

this cost from customers paying less 

than N300 a day for power?” said 

Adeyemo. 

Last year, I visited farming communities 

in Kaduna and Abuja 

and saw first-hand the revolution 

in energy access for rural folks 

through solar energy. In Baawa and 

Kadabo communities, in Makarfi 

Local government area of Kaduna 

State, Innotech 18 Meter Tunnel 

Solar Dryer acquired by Habiba 

Ali, with support from Power Africa 

partner, the U.S. African Development 

Foundation (USADF), helps 

pepper farmers dry their produce 

in half the time it normally takes, 

saving them 40 percent of products 

that would have been wasted from 

weather and rodents. 

“First and quite importantly is 

that these dryers save time, saving 

them 2.5 days of the 5days it would 

normally take to dry the peppers. 

This has ensured that they get their 

peppers on time to get to the market 

and they do a better bid because 

they now have cleaner peppers ensuring 

they sell at a 20% premium,” 

Ali said. 

In Lagos, entrepreneurs like 

Femi Oye, through a revolutionary 

solar-powered kiosks strategically 

located around markets help traders 

reduce waste of fresh vegetables and 

fruits. The solar powered refrigerator 

is capable of extending the shelf 

life of foods and vegetables from 2 

to 21 days. 

These new tariff will reverse 

these initiatives by young people 

motivated to solve practical problems, 

which their leaders binging 

on the common patrimony cannot 

remember. Over the last six months 

hundreds of containers of solar 

panel have entered Nigeria and the 

Nigerian Customs smells blood. 

“The import duty waiver on solar 

panels that the Nigeria Customs is 

undermining should only be the 

first step of what should be a comprehensive 

supply and demand side 

fiscal incentive policy to unlock the 

renewables sector in Nigeria. The 

incentives need to be more comprehensive 

and yet instead they are 

being rolled back,” Wiebe Boer, CEO 

of AllOn, an impact investment firm 

in the off grid space. 

Olateru Soji, on social media 

condemned the move too, “Why 

should 0% duty on solar in a country 

like Nigeria with an energy crisis 

even be up for debate? If we’re serious 

about any form of economic 

growth the Customs must reverse itself 

on this ridiculous duty increase.” 

Through the #NoToDutyOnSolar, 

thousands of Nigerians expressed 

their frustration with the decision. 

But popular outrage should have 

been unnecessary to convince the 

government that you don’t pull out 

a seedling to see how the roots are 

coming on. 

Arnergy like other operators have 

been unable to clear their containers 

of solar panel since January. 

The response from the Nigerian 

Customs Service employs the same 

logic you need to convince a hungry 

man that sniffing through a soup 

kitchen will satisfy his craving for 

food. 

“Solar panels is in 8501 called 

DC generator. It is anything that 

generates DC and 8501 talks about


C002D5556 

BUSINESS DAY 

FEATURE 

31 

generators and other generating 

sets. Generating sets are 8502. Solar 

panels are made up of minute photovoltaic 

cells and photovoltaic cell 

put together can be used as a signal 

and they can also be used for power. 

“Where they are used for signal, 

it is 8541 but where they are used 

for power generation, they are in 

8501, the difference between these 

two is that 8541 does not have a bypass 

diode, while 8501 has a bypass 

diode,” said Anthony Anyalogu, 

head of classification at the Nigerian 

Customs Service. 

“What is a bypass diode? It makes 

it to have a constant energy wavelength, 

without a diode, it does not 

have a constant energy wavelength 

and you cannot use it for power 

because if you put your bulb on, it 

will be shaking but that of 8501 because 

of the bypass diode, can have 

a steady current. 

This is the technical version, 

shorn of all the verbiage; it effectively 

puts solar panel in the same 

class as diesel generators simply 

because the result of its activity is 

power generation. 

Joseph Attah, Customs PRO, in 

response to media questions gives 

the nuanced version, equally suffering 

a deficit of reason. 

“Government in a bid to support 

the power sector brought a policy 

that says solar panels which are 

under HS code 8541 attract zero 

percent duty but when you bring 

solar panels that have other systems 

they have components when it becomes 

a set having the electrons, 

the diodes. It will no longer be 

under 8541, it will be under 8502 

and 8502 attracts five percent. This 

is what some of them don’t appear 

to understand.” 

Adeyemo and other operators 

disagree. “Solar panels are not 

mechanical components with moving 

parts, besides the Customs has 

always isolated other components 

and charged duties without objections 

from our members,” he said 

shortly before the press conference. 

Adaju counsels that even if the 

Nigerian Customs Service wants to 

reclassify import codes, it should 

notify the public and give operators 

time to adjust their business plans. 

However, Anyalogu insist this is 

standard practice in America, Europe 

and other parts of the world. 

But checks show that the United 

L-R: Femi Adeyemo, co-founder/CEO, Arnergy; Vera Nwanze, MD, Azuri; Dotun Tokun, MD/CEO, Solarmate Engineering 

Ltd; Chuks Umezulora, co-founder/COO, Auxano Solar Nigeria Ltd, and Segun Adaju, chief energizing officer, Consistesnt 

Energy, at a press briefing on imposition of import duty on solar panels in Lagos, on March 28. 

States and Germany give their citizens 

a rebate for using solar. In many 

African countries including Kenya, 

Tanzania and Ghana, solar panels 

are duty free. 

“In my experience working 

across several African countries, 

solar panels have always been duty 

free. In Ghana it is not only duty free 

but is given priority clearance at the 

ports,” said Vera Nwanze, general 

manager of Azuri Technologies. 

An analysis of the returns from 

investments in solar mini grids show 

that operators can make up 12.5 

percent returns. Commercial banks 

offer loan facility at 22 percent interest 

and the imposition of this new 

tariff could wipe off 50 percent of 

their revenue due to high prices and 

consequent slow demand growth. 

Meanwhile the Federal Government 

sells 5 year bonds at 13.5 percent. 

You would have to be charity to 

think of investing in the sector now. 

“I think the government should 

just come out and tell us they don’t 

really want this solar thing, so we 

can decide what next, maybe to 

open a bakery may be better now,” 

says Adeyemo. 

Nigeria’s clean energy drive 

threatened 

In 2016, Nigeria signed the Paris 

Accord which sought to cut carbon 

emissions by reducing dependence 

on fossil fuels and ramping renewable 

energy adoption. 

To this end, Nigeria issued debut 

Green bonds to meet its Paris Nationally 

Determined Contributions 

(NDC). It realised N10.69 billion in 

2017 and the ministry of environment 

is now targeting the issuance 

of N150 billion green bonds this 

year. 

Nigeria seeks to generate 30% 

of its power through renewables by 

2030. To this end, pragmatic policy 

like the mini-grid regulation was 

released in 2016 by the Nigerian 

Electricity Regulatory Commission 

(NERC), which makes a permit 

optional for an operator that distributes 

up to 100kW but demands 

permit for installed generation capacity 

above 1MW. It will also allow 

investors to generate, transmit and 

distribute power to willing buyers at 

market price. 

The regulation was specifically 

designed to fast-track electrification 

in areas without any existing distribution 

grid and provides access to 

power to areas poorly served or with 

non-functional distribution grid. 

Investors are only beginning to map 

out investments in mini grids and 

strategizing on how to develop them 

economically before the Customs 

came up with a duty on solar panels. 

Last year, Nigeria granted solar 

panel manufacturing pioneer status 

to encourage the sector and has a 

National Agency for Science and Engineering 

Infrastructure (NASENI) 

that is supposed to be producing 

solar panels, even though it is poorly 

funded, but this seems to signify 

intent to drive the sector. 

This new import duty is at variance 

with these goals. While increased 

revenue appears to be the 

motive behind this Customs regulation, 

it cannot be done in a way that 

undermines this nascent sector. 

“Instead of short sighted import 

duties which undermine sound 

Federal Government policy, Nigeria 

Customs should consider how much 

duty they can collect from imports 

for a far more productive economy 

in five years with up to $10 billion 

of mini grids and 10 million solar 

home systems operational and driving 

economic growth,” said Boer. 

Growing local capacity can’t be 

the reason 

Nigeria currently does not have 

capacity to manufacture solar panels 

but does limited assembly in 

volumes that cannot meet up to 

10% of market demand by only two 

operators – Lagos based Auxano 

Solar and Blue Carmel Energy Ltd 

based in Kaduna. 

“Locally, we don’t even have capacity 

to assembly enough panels to 

meet demand. Nigeria cannot live in 

isolation in comparison with other 

West African countries, imposing 

this kind of tariff will only move 

investments to other countries,” said 

Chuks Umezulora co-founder of 

Auxano Solar Nigeria Limited. 

Morocco provides a teaching lesson 

on how a responsible government 

develops clear strategy to diversify its 

energy source. In 2009, it adopted a 

national energy strategy to improve 

Laws were enacted to permit 

for auto-generation of electricity 

though renewable energy installations 

by industrial clients up to 50 

MW. Another renewable energy law 

allows energy developers to invest 

in renewable energy projects and 

sell the electricity to a chosen client 

– even for export – on the basis of a 

negotiated contract. 

“Opening up the medium, high 

and very high voltage levels for 

private power producers this law 

brings about competition in electricity 

production, though some 

developers complain about slow 

authorisation procedures, particularly 

in terms of technical approval 

through ONEE. Also, a decree is still 

missing (and currently under preparation) 

which is required for projects 

on the medium-voltage level,” said 

energypadeia. 

Morocco has launched one of the 

world’s largest solar energy projects 

costing an estimated $9 billion. 

The aim of the project is to create 

2,000 megawatts of solar generation 

capacity by the year 2020. The 

Moroccan Agency for Solar Energy 

(MASEN), a public-private venture, 

has been established to lead the 

project. 

Meanwhile, Nigeria is reversing 

gains already made with this new 

duty. It will increase acquisition 

cost of solar panels and make other 

African markets attractive for new 

investments. 

East African countries are already 

miles ahead of Nigeria in 

terms of solar adoption attracting 

millions of dollars in new investments. 

Some of the operators have 

confirmed that their partners are 

now negotiating exit from Nigeria. 

“Since this new duty, I have had 

two discussions with partners who 

are asking about how we could enter 

the East African market,” Ernest 

Akale, Abuja-based solar energy 

operator says. 

REAN is urging the Federal Government 

to take control of the 

situation immediately and instruct 

Thousands of Nigerians shared the message on social media 

security of energy supply and affordability, 

while also addressing environmental 

and safety concerns. 

The strategy sought to reach 

these goals by diversifying energy 

sources, optimizing the electricity 

mix, increasing local production 

particularly from renewable sources, 

promoting energy efficiency, 

and advancing regional integration 

according to an online energy resource. 

It was implemented through 

energy sector reforms, including 

legislative changes, increased transparency 

and competition, as well as 

capacity building. 

the Nigerian Customs Service to 

immediately stop the imposition of 

this duty on imported Solar Panels. 

“We also urge the Federal Ministry 

of Finance to establish a dedicated 

task force for Renewable Energy 

and Energy Efficiency within the 

Nigerian customs that will fast track 

screening of RE and EE components 

coming into the country and streamline 

the cumbersome importation 

process. This task force will also 

ensure that the correct HS codes 

and Federal Government incentives 

are applied to imported RE and EE 

goods,” Adaju said.



Live @ The Stock Exchange 

Top Gainers/Losers as at Friday 06 April 2018 Market Statistics as at Friday 06 April 2018 

GAINERS 

Company Opening Closing Change 

NESTLE N1380 N1385 5 

UNILEVER N55 N59.8 4.8 

DANGSUGAR N20.75 N21.45 0.7 

NB N128.3 N129 0.7 

MAYBAKER N2.92 N3.2 0.28 

LOSERS 

Company Opening Closing Change 

MOBIL N183 N170 -13 

TOTAL N249 N236.6 -12.4 

INTBREW N51.7 N49.15 -2.55 

GLAXOSMITH N31.5 N29 -2.5 

FO N41.9 N40 -1.9 

ASI (Points) 40,841.14 

DEALS (Numbers) 6,108.00 

VOLUME (Numbers) 501,963,433.00 

VALUE (N billion) 5.846 

MARKET CAP (N Trn 14.753 

Stock investors lost N240bn last week 

…Unic, Sovereign Trust, FTN Cocoa disappoint with over 50% price decline 

Stories by 

Iheanyi Nwachukwu 

Year-to-date (ytd) 

returns from 

Nigerian stock 

market declined 

to 6.79percent 

on Friday even as equity investors 

lost about N240billion 

last week. 

The stock market declined 

by 1.6percent in first 

trading week in April as the 

bears dominated Customs 

Street trading despite positive 

corporate earnings that 

were reported. 

Nineteen (19) equities 

appreciated in price last 

week, lower than 40 in the 

preceding trading week. 

Fifty-three (53) equities depreciated 

in price, higher 

than 40 equities of the preceding 

week, while 99 equities 

remained unchanged, 

higher than 91 equities 

recorded in the preceding 

week. 

Last week was another 

four-day trading week, as 

the Federal Government 

declared Monday, April 2 

as a public holiday for the 

Easter celebrations. 

The market recorded 

total turnover of 1.765 billion 

shares worth N26.562 

billion in 20,265 deals in 

contrast to a total of 2.328 

billion shares valued at 

N28.927 billion that exchanged 

hands the preceding 

week in 25,530 

deals. 

Vetiva Capital analysts 

in their April 3, 2018 equity 

research anticipated another 

modest performance 

in this second-quarter 

(Q2) of 2018 to be “driven 

by improving economic 

landscape and expectation 

of better first-quarter (Q1) 

2018 earnings.” 

In the trading week to 

April 6, 2018, the Nigerian 

Stock Exchange (NSE) All 

Share Index (ASI) declined 

to 40,841.14 points, from a 

high of 41,504.51 points as 

at the preceding weekend. 

Likewise, the value of 

listed equities closed at 

N14.753trillion last Friday, 

a decline from N14.993 

trillion recorded the preceding 

Friday March 30. 

Some stocks that have 

failed to impress investors 

this year include UnityKapital 

Assurance Plc which lost 

54percent of its share price; 

Unic Insurance which also 

decline by 60percent; and 

Sovereign Trust Insurance 

Plc (-60percent). 

Others are: FTN Cocoa 

Processors Plc (-60percent); 

and Courteville Business 

Solutions Plc which recorded 

a decline of 54percent 

year-to-date. 

After four months of dormancy 

as a result of failure 

to form a quorum in the 

heart of executive and legislative 

government face-off, 

the Monetary Policy Committee 

(MPC) of the Central 

Bank of Nigeria last week 

FCMB Group reports N170bn full year gross revenue 

FCMB Group Plc last 

week released its audited 

financial results 

for the year ended 

December 31, 2017, reporting 

a gross revenue of N169.9 

billion. The Group recorded 

a profit before tax (PBT) of 

N11.5billion, while profit after 

tax (PAT) was N9.4billion. 

In demonstration of the 

enhanced confidence of customers 

in FCMB, deposits 

grew to N689.9billion as at 

the end of December 2017, 

an increase of 5percent, from 

N657.6billion in the corresponding 

year. The Group’s 

capital adequacy ratio also 

improved to 16.9percent from 

16.7percent, just as asset base 

increased to N1.19trillion, 

compared to N1.17trillion at 

the end of 2016. Non-interest 

income as at the end of 

2017 was N32billion, while 

loans and advances stood at 

N649.8billion. 

held its first meeting of the 

year. 

At the end of the twoday 

policy meeting, all 

members of the Monetary 

Policy Committee (MPC) 

in attendance voted to 

leave key monetary policy 

rates unchanged. 

GTI research analysts 

in their outlook for the 

month of April 2018 expect 

positive economic environment 

to dictate major 

activities in the month. 

“We expect to see a 

lower reading for March 

inflation, an improved 

first-quarter (Q1) GDP 

and improved March 

PMI (already released). 

These are expected to 

have a positive impact 

on Q1 earnings releases. 

This would likely buoyed 

market reprising considering 

that we have witnessed 

extended oversold 

of main indicators as 

a results of recent market 

correction and significant 

profit taking,” according 

to GTI research analysts. 

By and large, GTI expects 

a positive market 

bearing in this month. 

In the meantime, they 

strongly advise investors 

to take a keen interest on 

firms’ fundamentals before 

taking an investment 

position on such firms. 

“In spite of the reduction 

in the headline numbers, 

the Group’s performance for 

the year 2017 witnessed an 

improvement in core operating 

performance over the 

previous year after adjusting 

for the significant foreign 

exchange revaluation 

income enjoyed in 2016”, 

FCMB Group said in a statement 

following the released 

results. 

“In line with the repositioning 

strategy of the Group 

for better performance, the 

key drivers of the performance 

include increase in 

income from our non-banking 

activities, lower impairment 

charges from the Bank 

and its subsidiaries, and improved 

operating efficiencies 

through more pervasive use 

of technology”, the Group further 

stated. 

In November 2017, 

FCMB completed the acquisition 

of an additional 

60percent stake in Legacy 

Pension Managers Limited, 

which increased FC- 

MB’s stake from 28.2percent 

to 88.2percent, 

thereby making Legacy a 

subsidiary of FCMB. The 

acquisition helps achieve 

further diversification of 

service offerings and, consequently, 

earnings within 

the FCMB Group, which 

will be felt from the 2018 

financial year. 

FCMB Microfinance 

Bank Limited, the Group’s 

dedicated group lending 

and financial inclusion 

vehicle, commenced operations 

as a state microfinance 

bank in January 2017. 

The business will be the key 

driver of FCMB’s informal 

and agricultural sectors 

(particularly small-holder 

farmers) drive across the 

country. 

Cordros sees downside 

potential in GTBank stock 

Though the share 

price of Guaranty 

Trust Bank Plc 

closed Thursday 

April 5, 2018 at N44.10, 

analysts at Cordros Capital 

still see downside potential 

from the current 

level. 

Pursuant to the postlisting 

rules of the Nigerian 

Stock Exchange (NSE) 

for listed companies, the 

board of directors of GT- 

Bank Plc will be meeting 

on Wednesday April 18, 

2018 to consider the unaudited 

financial statements 

for the first-quarter 

(Q1) ended March 31, 

2018. 

Ahead of this meeting, 

in their last weekly 

stock recommendation, 

the Lagos-based research 

analysts’ said their target 

price (TP) for GTBank 

stock stands at N42.81. It 

was previously N42.45). 

“Our estimates are under 

review,” according to the 

Cordros Capital. 

“Guaranty Trust Bank 

Plc trades at forward Price 

to Earnings (PE) of 8.72x, 

above its 5-year average 

of 6.2x.”, according to 

Cordros Capital research 

analysts. 

GTBank audited financial 

results for the year 

ended December 31, 2017 

Segun Agbaje, 

MD, GTBank 

show gross earnings for 

the year grew by 1.1percent 

to N419.2billion from 

N414.6billion reported in 

the December 2016; driven 

primarily by growth in 

interest income as well as 

e-payment revenues. 

Profit before tax (PBT) 

stood at N200.2billion, 

representing a growth 

of 21.3percent over 

N165.1billion recorded 

in the corresponding 

year ended December 

2016. The bank’s loan 

book dipped by 8.9percent 

from N1.590trillion 

recorded as at December 

2016 to N1.449trillion in 

December 2017 while 

customer deposits increased 

by 3.8percent 

to N2.062trillion from 

N1.986trillion in December 

2016. 

IOSCO recommends improved regulatory reporting, 

transparency in corporate bond markets 

The Board of the 

International 

Organisation of 

Securities Commissions 

(IOSCO) has 

published its recommendations 

for improving the 

information on secondary 

corporate bond markets 

available to both regulators 

and the public. 

The recommendations 

seek to ensure that regulators 

have better access 

to information so they 

can perform their functions 

more effectively, 

and to enhance crossborder 

information sharing 

and understanding. 

The transparency recommendations 

aim to support 

the price discovery 

process and facilitate better 

informed investment 

choices. 

Updating IOSCO´s 

2004 report on Transparency 

of Corporate Bond 

Markets, the Regulatory 

Reporting and Public 

Transparency in the Secondary 

Corporate Bond 

Markets report makes 

seven recommendations 

that emphasise the importance 

of ensuring the 

availability of information 

to regulators, through reporting, 

and to the public, 

through transparency requirements. 

The report recommends 

that regulatory 

authorities should ensure 

that they have access to 

sufficient information to 

perform their regulatory 

functions effectively. 

In addition, it recommends 

regulatory authorities 

should have clearer 

regulatory reporting and 

transparency frameworks 

to facilitate better crossborder 

understanding of 

corporate bond markets. 

The report also recommends 

that regulatory 

authorities should consider 

steps to enhance 

pre-trade transparency in 

corporate bond markets 

and implement regimes 

that require post-trade 

transparency.


33


BUSINESSINTELLIGENCE 

In association with 

Firing The CEO 

A 

major responsibility of 

the Board is selecting 

the CEO. It must therefore 

ensure that it picks 

the right CEO and puts 

in place a succession plan that allows 

for smooth transition. With 

increased responsibilities and more 

stringent regulatory oversight, 

Boards need to ensure that they appoint 

CEOs who will allow them to 

go to sleep with both eyes closed. 

The Board also has the responsibility 

of setting Key Performance 

Indicators against which the CEO’s 

performance will be measured and 

appraised. More often than not, the 

KPIs are tired to corporate performance 

and many Boards don’t have 

a formal framework for appraising 

the CEO’s performance. It is good 

practice for the Board to define robust 

KPIs for the CEO beyond cor- 

porate performance. These should 

include the CEO’s leadership of the 

team, client/customer relationship 

management, corporate culture, 

employee development, managing 

key stakeholders, etc. 

Closely following the responsibility 

to select a great CEO is that 

of ensuring that a succession plan 

is in place. Oftentimes the Board 

does not pay sufficient attention to 

the senior leadership pipeline and 

delegates this responsibility to the 

incumbent CEO. The Board should 

ensure that there is appropriate capacity 

and competence at the level 

below the CEO and indeed across 

the organization. It should not take 

the CEO’s word for it, but sufficiently 

engage to ensure it has comfort in 

this regard. With a healthy pipeline 

of senior leadership, the impact of 

sudden CEO exit can be minimized. 

Firing the CEO is one of the most 

difficult tasks any Board will have to 

deal with. However, there are times 

it becomes inevitable to do just that. 

Where the CEO persistently does 

not meet set KPIs, fails to execute 

strategy, delivers non-inspiring 

leadership or “puts the company 

in trouble”, the Board may be left 

with no choice but to let him/her 

go. Firing the CEO could negatively 

impact the organization. For sure it 

comes at a significant cost. Some of 

the costs of firing a CEO are easy to 

measure. “Golden parachute” severance 

pay for example, are sometimes 

included in CEO employment 

contracts. Unless the CEO has been 

found complicit in some criminal 

or other underhanded matter, the 

company usually must pay up according 

to the terms of the contract. 

Some severance pay run into multiples 

of annual salary and bonuses. 

Another cost is that of replacing 

the exited CEO. Great CEOs don’t 

grow on trees and the process of 

recruiting the ideal candidate is not 

cheap. Beyond the fees of executive 

selection firms (many of these firms 

charge a percentage – sometimes 

in multiples - of the CEO’s salary 

and bonuses), the sheer time and 

effort that go into an unplanned 

exit, cause the Board to give careful 

thought when taking a decision to 

fire the CEO. 

There could also be the cost of 

losing business relationships which 

the departing CEO brought on 

board and nurtured. Some clients 

may choose to take their custom 

elsewhere with the departure of the 

CEO who courted them. Depending 

on the depth and nature of business, 

the effects of these could be 

 

2018 Academic Session 

Theme: 

“The Company Secretary: The Corporate Governance 

Professional” 

Company Secretaries, In-‐House Counsel, Interns, Compliance 

and Regulatory Officers, Lawyers and Chartered Secretaries 

Date: April 25 th & 26 th 2018 

Location: Green House, 235 Ikorodu Road, Ilupeju, Lagos. 

Enrolment & Registration: N100,000 

Modules: 

significant. The peculiarity of some 

businesses makes it difficult for the 

Board to mitigate the likelihood of 

this happening. Sometimes, the 

CEO’s personal connections constitute 

a large chunk of the patronage. 

Non-financial but equally 

damaging effects of the CEO’s unplanned 

exit include the impact 

on employee morale, especially 

among senior managers, who may 

wonder if theirs will be the “next 

head on the chopping block”. If the 

CEO was fired for taking a “risky 

bet” which went awry, employees 

will be less willing to take risks – a 

situation that will inevitably impact 

performance. There is also the 

possibility of mass exit – especially 

if the CEO was admired by his colleagues 

and goes on to either set up 

his own shop or to another organization 

from where he “poaches” his 

ex-colleagues. To be sure, some clients 

would also move with the CEO, 

particularly if the perception is that 

he/she has been unfairly treated. 

There is also the cost of perception. 

If not properly handled, the 

CEO’s exit could send negative signals 

to the public. It could create 

the impression that the company 

is “in trouble” and inevitably affect 

the share price – at least in a mature 

stock market. 

According to James McRitche 

in his article “When the CEO Really 

Must Go” (2011), there is never 

a “good time” to act, “so do it when 

you make the decision”. Many underperforming 

CEOs think they are 

doing a good job. In this regard, the 

Board must tell the truth early on. 

The CEO shouldn’t get a bonus he/ 

she doesn’t deserve because the 

Board doesn’t want to “demotivate” 

them. If the Board is not getting the 

expected results, it should communicate 

this clearly to the CEO. 

Upon coming to a decision that 

firing the CEO is the best in the 

circumstance, the Board needs to 

handle the exit with great care. The 

CEO should be allowed to exit “with 

grace”, quietly so that both parties 

can move on without bad blood. 

• Effective Minutes Writing 

• Effective Use of Board Committees 

• The Duty of Confidentiality 

• Understanding Financial Statements, Key Financial Ratios and IFRS 

Provisions 

• The Corporate Governance Framework 

• Preparing for Meetings – What the Company Secretary Should Know 

• Regulatory and Statutory Compliance 

• Effective Stakeholder Relationship Management 

For enquiries and registration: 

• Nike Taiwo: ntaiwo@dcsl.com.ng or08090381864 |Mobile:08052800715 

• Anne Agbo: aagbo@dcsl.com.ng or 08090381864 |Mobile: 080053038482 

Bisi Adeyemi is the Managing 

Director of DCSL Corporate Services 

Limited. For comments and 

reactions, kindly contact badeyemi@dcsl.com.ng.


C002D5556 

BUSINESS DAY 35 

Stocks Currencies Commodities Rates + Bonds Economics Funds Week Ahead Watchlist P.E 

Yield curve flattens on Fiscal and 

monetary policy synchronisation 

FSDH sees Nigeria inflation slowing for 

fourteen successive months to 13.49% 

Page 36 Page 36 

ECONOMY 

Seplat navigates oil rebound 

better than Erin, Savannah 

DIPO OLADEHINDE 

While Seplat, 

N i g e r i a ’ s 

largest indigenous 

firm 

rebounded 

to growth on the back of improved 

crude oil price, Erin 

energy and Savannah Petroleum 

both midsized firms 

continues to gasp for breath as 

it sweeps in an ocean of losses 

over major assets acquired. 

Seplat surmounted the 

headwinds brought on by 

lower oil price and political 

unrest the Niger Delta region 

as it recorded a profit after tax 

of $265 million to end 2017 

financial year from a loss of 

$165 million the previous year. 

On the other hand, Erin 

Energy, a small oil and gas 

firm recorded a 6.3 percent 

increase in its loss after tax to 

$151.9 million in 2017 from 

$142 million in 2016 while 

Savannah Petroleum, another 

small player in in the industry 

recorded an astronomical 178 

percent increase in loss after 

tax of $27.3 million in 2017 

compared to $9.8 million in 

2016. 

The lifting of a force majeure 

in the third quarter of 

2017 was a boon for Seplat 

as it resumed production 

and recorded returned to 

profitability however the two 

other firms gave reasons for 

their loss. 

Erin Energy said they have 

being investing money in the 

acquisition of new assets and 

shareholders will have to wait 

for dividend payment while 

share-buy backs could be 

delayed. 

“2017 had its challenges for 

our industry and our company, 

but Erin Energy’s perseverance 

and some stabilization of 

the commodity price, allowed 

for good progress in many 

of our efforts.” Femi Ayoade, 

ceo of Erin Energy said on the 

company’s official website. 

Savannah Petroleum is 

faced with the same dilemma 

as Erin Energy; the company 

acquisition of integrated gas 

company, Seven Energy increases 

its operating expenses 

by 222 percent to $27.1 million 

in 2017 from $8.4 million in 

2016. 

Savannah Petroleum CEO 

Andrew Knott said “the acquisition 

of assets from Seven 

Energy creates a full cycle 

exploration and production 

company, capable of paying a 

dividend from the cash flows 

generated by its upstream 

assets.” 

“The increase in overall 

general and administrative 

expenses during the year was 

as a result of exceptional business 

development costs of 

$18.5 million in relation to the 

Seven Energy transaction,” 

Knott said on the company 

official website. 

In 2017, Seplat recorded 

a Profit before tax of $44 million 

in 2017 after making a 

loss after tax of $173 million 

in 2016 in 2016; Erin Energy 

increased its loss to $151.9 

million from $142 million in 

2016 while Savannah Petroleum 

Plc announced a loss 

of $27 million which was a 

170 per cent increase from 

$10million in 2016. 

Jubril Kareem an energy 

analyst with Ecobank Re- 

search group said when oil 

company assets are in exploration 

phrase it’s normal to 

make loss in Nigeria Oil and 

Gas industry. 

“Compare to International 

oil companies and Seplat 

which already have established 

revenue stream, majority 

of Erin Energy assets 

are exploration and developmental 

phrase so there 

revenue is in the future when 

these assets they are investing 

in will start making profits,” 

Kareem added. 

BusinessDay investigation 

showed at full year 2017 

Seplat expanded revenue by 

78 per cent to $452 million 

from $254 million in 2016; 

Erin Energy had an increase 

of 30 per cent to 101.2 million 

in 2017 from 77.8 million in 

2016, while Savannah Petroleum 

year-on-year operating 

loss remained flat at $8m, as 

the Group remained in the 

pre-revenue exploration and 

development phase of operations. 

In 2017, Seplat shareholders 

fund stood at $1.5billion, 

while Erin Energy and Savannah 

Energy Shareholders fund 

stood at $251 million and $289 

million respectively. 

Investigation in net cash 

flow from operating activities 

showed Seplat recorded 

increase of 161.40 percent 

to $447 million from $171.59 

million recorded last year, Erin 

Energy recorded an increase 

of 333 percent to $26 million 

in 2017 from $6 million in 2016 

while Savannah Petroleum 

recorded 85 percent increase 

from $8.4 million in 2016 to 

$15.6 million in loss net cash 

flow in 2017. 

The indigenous upstream 

oil and gas giant Seplat had a 

$450 million in free cash flow 

in 2017, which represents a 

275.75 percent surge from 

$119.76 million recorded as 

at December 2016, while Erin 

Energy and Savannah Petroleum 

both have a negative 

free cash flow of $26 million 

and $17.4 million respectively 

A negative free cash flow 

from operating activities 

means oil and gas firm has 

been investing money in the 

acquisition of new assets 

albeit shareholders will have 

to wait for dividend payment 

while share-buy backs could 

be delayed. 

Further investigation revealed 

Seplat has a free cash 

flow yield of 0.11 percent, 

while Erin Energy and Savannah 

had free cash flow yield 

of 3.2 percent and 7.8 percent 

respectively. 

The free cash flow yield is a 

powerful tool, mostly because 

it establishes the relationship 

between the money you put 

in a company compared to 

the returns it generates. 

The recession as well as a 

slump in oil prices had many 

companies on their knees in 

2016. Seplat, Erin Energy and 

Savannah Petroleum were 

part of them, after sinking 

to less than $28 in 2016; oil 

prices rebounded to give vim 

to the economy with oil companies 

cashing in big. 

The price of Brent crude, 

Nigeria’s benchmark grade, 

cooled 0.13 percent to $68 

per barrel Friday, according 

to Bloomberg data, Oil production 

on the other hand 

has recovered to 1.8 million 

barrels as at February 2018, 

according to OPEC data, from 

as low as 1.2 million barrels 

daily in the thick of militant 

disruptions. 

These factors contributed 

to lifting the economy from 

recession in the second quarter 

of 2017, according to the 

National Bureau of Statistics 

(NBS). The economy has 

consolidated its exit from 

recession after growing 0.8 

percent in 2017 compared to 

a 1.6 percent contraction the 

previous year. 

SHORT TAKES 

$1.64 million 

FCMB group seeks to convert 

its wholesale banking unit in 

Britain, FCMB UK, into a retail 

bank, as part of its push to 

grow its balance sheet and tap 

into non-institutional customers 

in Britain. 

The impact of the British strategy 

would not be immediate 

but would enable the lender to 

achieve incremental growth. 

The earnings contribution in 

naira terms from the British 

unit will be around 500 million 

naira ($1.64 million) for 2018. 

FCMB UK grew pre-tax profit 

by 250 percent to 300 million 

naira last year. 

N3.04 billion 

AIICO Insurance 

Posts Full Year 

Profit Before Tax of 

N3.04billion compared 

to N11.84 

billion year ago . 

While tits Full Year 

ended December 

2017 net premium 

income was N17.50 

billion naira versus 

N26.69 billion naira 

year ago. 

15 Kobo 

Caverton Offshore Support 

Group announces proposed 

final dividend Of 15 

Kobo Per 50 Kobo ordinary 

share, subject to appropriate 

withholding and 

approval will be paid to 

shareholders whose names 

appear in the Register of 

members as at the close 

of business on the 25th of 

April, 2018 . 

BusinessDay MARKETS INTELLIGENCE (Team lead: BALA AUGIE - Analyst: DIPO OLADEHINDE, ENDURANCE OKAFOR, BUNMI BAILEY Graphics: DAVID OGAR ) 

BMI provides in-depth analysis and data on industries, companies, stocks, currencies, fixed income/credit, economics, regulation and factors that influence investor’s decision-making 

Email the BMI team patrick.atuanya@businessdayonline.com


ECONOMY 

ENDURANCE OKAFOR 

Markets Intelligence 

Yield curve flattens on Fiscal and monetary policy synchronisation 

The recent synchronization 

between the 

fiscal policy and the 

monetary side has help 

bring down the yield 

curve down in the first quarter 

of 2018. 

Moderating inflation rate, a 

positive economic growth, a loosened 

monetary policy in terms 

of the creation of the Investors’ 

& Exporters’ FX Window and 

naira devaluation coupled with 

reduction in domestic borrowing, 

are the catalysts to the flat yield 

curve recorded in the quarter. 

The Debt Management Policy 

of the Nigerian Federal Government 

is to attain 60 percent of 

domestic borrowing, that is, 

Treasury Bills, FGN Bonds, Savings 

Bonds & Green Bonds, and 

then 40percent of foreign debt 

through euro bond issuance as 

compared to the current ratio 

position of about 75:25 percent 

respectively. 

Nigeria has a Treasury bill 

portfolio of N2.7 trillion and paid 

off N198 billion worth of bills in 

December 2017, leading to rates 

dropping by around 300 basis 

points. 

The Debt Management Office 

(DMO) issued in February 2018 

US$2.5 billion in Eurobond as part 

of its on-going debt restructuring 

strategy aimed at increasing external 

debts and cutting down on 

domestic debts, the issued bond 

is to be used to redeem relatively 

more expensive domestic debt 

instead of rolling them over like 

Meanwhile, the rate at which 

the prices of goods and services 

increase in Nigeria (inflation) 

moderated to 14.33 percent in 

February from 15.13 percent the 

previous month, making it the 

thirteenth straight month of decline, 

but still remains well above 

the 6-9 percent preferred band, 

according to data provided by 

the National Bureau of Statistics 

(NBS). 

The Monetary Policy Committee 

(MPC) last week Wednesday 

held its benchmark rate of 14 

percent for the ninth successive 

time since raising it by 200 basis 

points in July 2016, in a bid to 

allow inflation rate moderate 

further. 

Nigeria’s Purchasing Managers’ 

Index (PMI) rose strongly 

in March, expanding from 54.7 

percent to 59.4 percent. 

FSDH sees Nigeria inflation slowing for fourteen successive months to 13.49% 

MICHEAL ANI 

FSDH Merchant Bank Limited, 

has predicted a drop in 

the rate of inflation (yearon-year) 

from 14.33 per cent 

recorded in February to 13.49 

per cent in March 2018, according 

to a recent report released 

by its research team. This would 

mark the fourteenth month that 

prices have cooled. 

The expected drop in inflation 

rate is premised on the 

base effect of higher prices in 

the Composite Consumer Price 

Index (CCPI) in March 2017 than 

the current month. 

The Monetary Policy committee 

(MPC), on Wednesday left its 

repo rate at a record high of 14 

per cent since July 2016 in its first 

meeting this year, after a political 

standoff between the executive 

and the senate, prevented a 

quorum for months. 

The committee held its gun, 

in a bid to curtail spiralling inflation 

which soared to an 11-year 

high in April 2016, following a big 

naira devaluation and an upward 

review in the retail price of petrol. 

“We expect the rate of inflation 

to cool 0.84 bps to 13.49 

percent in March 2018,” FSDH 

said, ahead of an official release 

by the National Bureau of Statistics 

(NBS) on April 16. 

before. 

US$1.25 billion was issued in 

12-year tenor Eurobond maturing 

in 2030 and a second tranche 

of US$1.25 billion in 20-year tenor 

Eurobond to mature in 2038. The 

yields on the 12-year tenor bonds 

came in at 7.14 percent, 425 basis 

points premium on 10-year US 

treasuries while the 20-year 

tenor bond was priced at 7.68 percent, 

455 basis points premium on 

US treasuries. 

A flattening yield curve indicates 

the yield spread between 

long term and short term is decreasing, 

that is, a decline in the 

gap between yields on short-term 

bonds and yields on long-term 

bonds. This makes the curve 

become less steep. Although, the 

normal shape of the yield curve 

is generally known to be upward 

sloping. 

The monthly Food Price Index 

(FPI) from the Food and 

Agriculture Organization (FAO) 

released shows that the Index 

was up 1.05 percent to 172.8 

points in March from the revised 

value for February. The increase 

recorded in the FPI was because 

The inverted yield curve is 

an interest rate environment in 

which long-term debt instruments 

have a lower yield than 

short-term debt instruments of 

the same credit quality. This is 

considered to be a predictor of 

economic recession. 

Flat yield curve is often seen 

during transitions between inverted 

and normal curves and as 

such the investor does not gain 

any excess compensation for 

the risks associated with holding 

longer-term securities. 

It is typically indication that 

investors and traders are worried 

about the macroeconomic 

outlook. One reason the yield 

curve may flatten is market 

participants may be expecting inflation 

to decrease or the Federal 

Reserve to raise the federal funds 

rate in the near term. 

of a strong recovery in dairy and 

cereal prices. 

The FAO Dairy Price Index 

appreciated by 3.26 percent in 

March as prices of butter, Whole 

Milk Powder (WMP) and cheese 

were on the increase. This increase 

was mainly supported by 

strong global import demand 

and lower than expected milk 

output. 

The FAO Cereal Price Index 

was also up by 2.67 percent 

from February. The sustained 

increase recorded in the cereal 

price Index is as a result of the 

rise in the prices of most of the 

major cereals. 

The FAO Meat Index was up 

by 0.32 percent driven by the 

increase in the prices for ovine 

meat, pig meat and poultry meat. 

On the flip side, the FAO sugar 

Price Index dropped by 3.4 percent. 

The drop in the Index is on 

the heels of favourable supply 

conditions in the main sugar 

producing regions, and a weaker 

Brazilian Real. The FAO Vegetable 

Oil Price Index was down 

by 0.77 percent as soy, rape and 

sunflower oils prices dropped 

The naira remain stable at 

the parallel market, but gained 

The shape of the yield curve is 

often used by economists and investors 

to gain insight about what 

is happening in an economy. 

When the yield curve becomes 

inverted, profit margins 

fall for companies that borrow 

cash at short-term rates. 

It may also reduce the incentive 

for banks to lend to the private 

sector as they often prefer 

to invest in lower-risk or risk free 

Government securities. 

For consumers an inverted 

yield curve has an impact when 

their loans have interest-rate 

schedules that are periodically 

updated based on short-term 

interest rates. 

Many Nigerian consumers 

experienced this last year when 

some banks sent out notifications 

increasing the interest rates on 

current loans. 

0.08 percent at the inter-bank 

market to close at US$/N305.65 

from US$/N305.90 at the end of 

February. 

FSDH said that “the appreciation 

recorded at the inter-bank market 

between the two months under 

review moderated the impact of the 

imported consumer good prices in 

the domestic market”. 

The prices of most of the food 

items in March 2018 recorded 

moderate appreciation, leading 

to 1.12 percent increase in Food 

and Non-Alcoholic Index. 

The Index increased by 

16.31percent from 229.71 points 

recorded in March 2017. 

Furthermore, there was increase 

in the prices of Transport 

and Housing, Water, Electricity, 

Gas & Other Fuels divisions between 

February and March. 

“We estimate that the increase 

in the CCPI in March would produce 

an inflation rate,” FSDH said.


Start-Up Digest 

In 

BUSINESS DAY 

37 

association with 

How FIIRO directors frustrate Nigerian SMEs 

ODINAKA ANUDU 

Date was January 

27, 2015. Jon 

Kachikwu, chief 

executive officer 

of a small-scale 

food processing and export 

firm known as Jon Tudy Interbiz, 

addressed a letter to the 

director-general of the Federal 

Institute of Industrial Research, 

Oshodi (FIIRO), requesting the 

fabrication of groundnut frying 

and chaf removal machines, 

otherwise known as groundnut 

roaster and dehuller respectively. 

The letter was acknowledged 

on that same date by one 

Abraham C.O., a staff member 

of FIIRO. 

It took FIIRO 17 days to reply 

this letter on February 13, 

2015. The institute, through 

one of its directors, W.B. Asiru, 

sent a quotation to Jon Tudy 

Kachukwu. A document seen by 

BusinessDay showed the price 

of groundnut roaster (680kg/ 

hour) as N680, 000 and that of 

groundnut dehuller (800kg/ 

hour) as N650, 000. 

Kachikwu paid N770, 000 

into FIIRO’s account as part 

payment for both machines on 

February 18, 2015, a document 

seen by BusinessDay showed. 

The entrepreneur later completed 

the money to N950, 000, 

which, according to him, was 

acknowledged by FIIRO. 

Till April 24 of that year, FI- 

IRO did not supply the said machines 

to Kachikwu, prompting 

the entrepreneur to write to the 

agency. 

A letter addressed to the 

director-general of FIIRO read: 

“With reference to the above 

subject matter which was dated 

February 13, 2015, we wish to 

remind you sir that the delivery 

date and installation of the 

machines have elapsed. 

“As per your quotation, we 

were requested to make a 70 

percent down payment and 20 

percent after four weeks, balance 

10 percent after installation 

and testing. On our part 

we made the mandatory 70 

percent down payment, after 

four weeks, we contacted the 

relevant department in order to 

make additional payment and 

we were asked to hold on. It is 

over eight weeks and our machines 

are yet to be delivered. 

“This delay has messed up 

our projection for the year. Our 

workers are redundant and salaries 

are not being paid. While 

we are still waiting for your 

organisation to sort things out, 

we would suggest you allow us 

to make use of your machines 

in order to cushion the effect of 

this unfortunate delay.” 

The institute did not make 

any machine available to Kachikwu 

as requested. 

Jon Kachikwu 

Due to FIIRO’s inability to 

produce the two machines 

paid for, Kachikwu temporarily 

requested a contract with the 

government agency whereby 

it could dry groundnuts on his 

behalf pending when the machines 

would be ready. 

Kachikwu requested that 

FIIRO dry between five and 10 

tonnes of groundnut within the 

next 30 days. 

“But they could not deliver 

on this,” Kachikwu told BusinessDay. 

In 2016, FIIRO supplied the 

two said machines to Kachikwu, 

but they were faulty and 

could neither roast nor dehull 

groundnuts. 

Kachikwu addressed a letter 

to Dele Oyeku, director of extension 

and linkages at FIIRO, 

complaining that the machines 

fabricated by the agency were 

not working. This letter was 

acknowledged by one Omolayo 

J.O, a staff member of FIIRO, on 

March 17, 2017. 

Kachikwu wrote another 

letter the same day indicating 

that the two machines had been 

returned. The same Omolayo 

J.O acknowledged the return 

of the faulty machines in the 

said letter. 

Due to, once again, FIIRO’s 

inability to supply functional 

machines 32 months after, 

Kachikwu engaged lawyers at 

Coronet Legal, who demanded 

the immediate supply of the 

machines. 

A letter written by the lawyers 

to FIIRO revealed that the 

The transaction 

was done by me, 

and everything 

went well. I am 

surprised that the 

DG (Elemo) could 

say that it was not 

done through the 

institute. What 

happened was 

that they asked 

me to hands off at 

some point, that I 

am not in charge 

of that. If the DG 

said that, I am really 

surprised 

Gloria Elemo 

institute conducted two tests on 

the two machines returned by 

Kachikwu but both failed. 

“Our client has suffered great 

loss and untold hardship due 

to the delay as it had secured 

a loan facility to pay for the 

machines with running interest 

and yet got no value or its money 

owing to the unwarranted 

delay by your establishment. 

“We therefore demand an 

immediate supply of the said 

machines which must be functional 

to 100 percent capacity,” 

the letter, signed by Sophina 

Ozougwu, a lawyer, read. 

The lawyers threatened to 

take legal action against the 

institute, but all their warnings 

fell on deaf ears, it was 

gathered. 

After pressing for his money 

from the institute, Gloria Elemo, 

director-general of the 

institute, sent contradictory 

text messages to Kachikwu. 

The message sent by Elemo 

read: “Good evening sir. The 

institute does not have funds 

with respect to the situation in 

the country. We are not even 

able to meet our obligations. It 

is unfortunate that we cannot 

meet your demand right now.” 

The message continued: 

“More so, you did not channel 

your fabrication directly 

through the institute. You 

worked with a staff on private 

basis. There was no record of 

the transaction in the institute.” 

BusinessDay called the 

phone number of Gloria Elemo 

many times but the calls were 

not picked. Text messages were 

sent to her phone number but 

she did not reply. 

This correspondent visited 

W.B Asiru, the director at the 

centre of the whole transaction, 

whom the director-general said 

handled the transaction on private 

basis. 

Our conversation with Asiru 

took place at Frontline Guest 

House, located opposite FIIRO 

office at Oshodi, Lagos. 

When asked whether the 

transaction was done on private 

basis, Asiru said: “The transaction 

was done by me, and everything 

went well. I am surprised 

that the DG (Elemo) could say 

that it was not done through the 

institute. What happened was 

that they asked me to hands off 

at some point, that I am not in 

charge of that. If the DG said 

that, I am really surprised.” 

Asiru acknowledged that 

Kachikwu made the payments 

needed but the machines were 

not supplied to him. 

BusinessDay contacted Dele 

Oyekun, who took over the 

transaction from Asiru. 

“I am aware of the whole 

thing,” Oyekun said. 

“At the end of the day, the 

DG asked me to take charge. At 

a point, we eventually produced 

the equipment. During installation, 

they were little errors. 

We said the head of engineering 

should work on them. They 

have not finished working on 

them. I know there was a time 




C002D5556 


Meet Jumoke Dada, craftsman 

who makes afro-urban furniture 

Josephine Okojie 

Jumoke Dada is the founder 

and CEO of Taeillo, a 

start-up brand that produces 

urban furniture 

using African inspired 

pieces. 

Jumoke was motivated to 

establish Taeillo in 2016 out of 

her passion to brand Africa’s 

culture and identity in appealing 

modern designs through 

furniture. 

“I wanted was to create a 

great piece because I realised 

that many of our traditional 

arts and crafts evolved overtime 

to include practical and 

decorative items and that human 

expressions find their way 

through various forms of art,” 

she says. 

In the light of all these, she 

has resolved in her heart to 

brand the African culture and 

identity and make it appealing 

to modern Nigerians through 

design and furniture. 

The Architecture graduate 

tells Start-Up-Digest that she 

started her business with zero 

capital, a computer and her 

idea. According to Jumoke, 

payment from her first contract 

was used for the purchase of 

Nneka Abiakam-Madunatu 

is the founder of 

NMA Garment Factory, 

a one-stop shop for 

made-in-Nigeria clothes. This firm 

has continued to gain traction for 

the quality and affordability of its 

products. Despite being a graduate 

of Law, her love and passion for designs 

and creativity inspired her to 

start the clothing business in 1999. 

“I always loved creating things, 

cutting up pieces, sketching and 

designing. I started doing this mass 

market strategy when I had my son. I 

was abroad for six months and I employed 

people in Yaba and Mushin 

in Lagos. When I came back, I went 

to these places and saw a lot of them 

smoking because there was no job. 

“So I thought to myself that if I 

properly engaged the people, they 

would be engaged. That was when I 

decided to structure my factory and 

buy more machines. A factory work 

is one that you come, work and get 

paid,” the entrepreneur says. 

The entrepreneur, who currently 

has 14 outlets in Lagos and others in 

Abuja, Awka and Enugu, says she 

will soon commence operations in 

Calabar and Ghana. 

She discloses that her vision is to 

employ 1,000 Africans both directly 

and indirectly by 2020. She currently 

employs 25 workers directly 

and 55 workers indirectly. 

“I believe I am going to be in the 

Dubai Mall. If I am there, I want to 

make my dresses affordable. Even 

Jumoke Dada 

materials needed for the first 

furniture piece she made. Subsequently, 

she sold the furniture 

for N52,000 and made a 

profit of N12,000 then. 

After Jumoke’s first furniture 

piece, she began to get referrals 

from her initial client, family 

and friends, which helped her 

in generating revenue she reinvested 

into the business. 

So far, the University of Lagos 

(Unilag) graduate has raised 

some money through grants 

from local and international organisations 

to further increase 

her production capacity. 

The young entrepreneur says 

she sources all her raw materials 

used in production locally. 

Since Jumoke started her 

business in 2016, it has grown 

tremendously despite the market 

being saturated. She explains 

to us that Taeillo has 

continued to grow owing to its 

leverage on technology and 

consistent investments into 

research and development. 

“When we were going into 

the market, we understood 

that the furniture market was 

saturated, but we were still able 

to grow the business because 

we leveraged on technology. 

Technology helped us scale our 

business model, coupled with 

the strong investment we put 

into research and development 

to continue to produce exciting 

designs,” she states. 

Answering questions on 

the challenges confronting 

her business, the Architectturned-furniture 

maker says 

that her current industry lacks 

the required skilled professionals 

that are detailed in craft and 

designs. This, according to her, 

remains the major challenge 

confronting her business. 

She also notes that the huge 

infrastructural gap is another 

challenge facing the business. 

She wants governments at 

federal, state and local levels to 

invest more into human capital 

development in order to provide 

industries with the needed 

skills. Jumoke also urges them 

to provide an enabling environment 

for businesses by investing 

in key infrastructure. 

Speaking on her business 

expansion plans, the entrepreneur 

says she plans to further 

expand the business and its 

production capacity while increasing 

global reach through 

technology. 

Similarly, she plans to have 

a furniture showroom across 

major African cities and Nigeria. 

She also wants to have a 

foundation in a way of giving 

back to the society by helping 

the less privileged. 

Speaking on her advice to 

other entrepreneurs, Jumoke 

says, “Love God, be persistent 

and burn that ship.” 

Nneka Abiakam-Madunatu: Entrepreneur mass producing made-in-Nigeria clothes 

IFEOMA OKEKE 

Nneka Abiakam-Madunatu 

if you are taking African culture to 

western world, let it be affordable. 

If it is affordable, then we can tell 

our story better,” she states. 

Speaking on the focus of her 

business, she says, “NMA Garment 

Factory is about promoting madein-Nigeria 

clothes. My goods are 

made locally and we have a capacity 

of 2,000 dresses every day. If we expand 

our capacity, we can actually 

employ more people and produce 

more. Our target is to make madein-Nigeria 

cloths really affordable.” 

She stresses that when she started 

making her clothes affordable, 

everyone started buying from her, 

including the domestic workers and 

girls in school. 

“I have a skirt for as low N1, 000, 

and I have a target to sell 300 skirts 

every day,” she says. 

Abiakam-Madunatu says she 

currently exports to Ghana and Kenya. 

“The more expensive things are, 

the less you sell them. Apart from the 

fact that it is a business for me, I am 

also providing employment because 

I have a factory and people that use 

different kinds of machines. 

“The value chain of manufacturing 

is really long. We have models, 

accountants, auditors, quality control 

personnel, industrial ironing 

and people that do the buttonholes, 

among others. For my kind of business, 

the person that cuts is different 

from the person that joins the 

materials; another person will label; 

another will iron and on and on. 

That is how we can meet the target 

of 2,000 dresses every day,” she explains. 

She states that her target is to 

have a big garment factory and store 

in Balogun, Lagos, so that when 

people think of going to China, they 

will first come to her store and pick 

what they want. 

On how she sources raw materials, 

she says, “I still import, but I 

want to stop importing if I can make 

everything in Nigeria, which is what 

I am working on now. Some of my 

shoes are still produced in China, 

but all my garments are now made 

in Nigeria and people are encouraged 

by this,” she elucidates. 

Answering questions on the 

challenges facing the business, the 

entrepreneur says that people are 

yet to believe in Nigerian-made 

products and there are excessive 

overhead costs to pay in the country. 

On her success stories, she says, 

“When I was selling on Jumia, we 

were one of the most loved brands 

there. People started understanding 

that products of the same quality 

were cheaper in Nigeria than they 

were abroad. Times have changed 

a lot, people are really promoting 

made in Nigeria. 

“When people walk into my 

store, what we have, can meet international 

standards and they are 

half the price.” 

She encourages entrepreneurs 

across the country to be patient to 

achieve their dreams, adding that 

her business did not give her the 

life she wanted in one year but that 

she had to grow the business first to 

make money later.


BUSINESS DAY 

39 


‘My platform is turning teenagers, 

students into entrepreneurs’ 

Ayoolauwa Oluwatosin Lovelyn is the executive director of Ornasview Initiative, a firm that provides entrepreneurship 

training to teenagers through conferences, career talks and workshops. Ayoolauwa holds 

Bachelor of Science (Bsc) degree in Social Studies from Tai Solarin University of Education, Ogun State, 

Nigeria. In this interview with BUNMI BAILEY, the young entrepreneur calls on the government and the 

private sector to encourage more skill acquisition classes, especially for teenagers. 

Tell me about your business, 

and what inspired you to set 

it 

I 

up. 

am the CEO of Ornasview 

Initiative, which was 

birthed on March 21, 2017. 

We train teenagers and students 

on entrepreneurship 

to enable them become better 

people. A lot of teenagers are on 

the streets doing nothing, so we 

want to reduce the rate of promiscuous 

activities and crime. I want 

to build those teenagers by catching 

them young. It is our vision to 

give them a strong foundation. 

When we started, it was more 

of career talk, pushing them to 

do this and that, but on the first 

year anniversary, which was on 

the 21st of March 2018, we had 

our first physical training where 

we taught teenagers how to cook, 

make bags and beads, as well as 

how to perform in drama classes. 

It was a success and we had 

testimonies. I remember a particular 

lady telling me that when 

she initially wanted to learn 

confectionary from other places, 

they told her the amount that 

she needed to pay was N100, 

000. However, what she learnt 

and gained from our programme 

was far more than whatever she 

paid there. 

I was inspired at the age of 

15. At that age, my family started 

having financial issues, which 

affected my ability to pay school 

fees. I used to be among the first 

set to pay before I started having 

issues. While others were in 

school, I would be sitting in the 

passage and be reading my textbooks. 

So to keep myself busy 

when parents went to work in the 

morning, I would volunteer to 

teach little children and give them 

comfort even when I had nothing. 

From there, I began to teach 

candidates preparing for for 

Ayoolauwa Oluwatosin Lovelyn 

WAEC, SAT, and other exams. I 

raised money from there. When 

I entered school, I wanted to do 

something tangible with my life. 

So, I started a blog but did not 

have the means like laptops, and 

my school then was facing a lot of 

power supply challenges. 

I felt that it was high time I 

discovered myself and do something 

worthwhile. I went back 

to a series of trainings and from 

there; I got a confirmation to pass 

that training to others. The main 

reason why I am doing this, and 

I don’t want to stop, is because I 

don’t want the teenagers to make 

the mistakes that we the youths 

made during our own time, because 

teen time is the prime time 

and whatever decision made then 

is going to determine what tomor- 

row will be. 

What was your initial start-up 

capital? 

I started with a N100, 000. I was 

able to raise it from myself, family 

and friends. And another strategy 

that I also used to get more 

funds was that I printed logos 

on exercise books and charged 

people who wanted their logos 

on the book. 

How has your business grown 

since it started? 

It has grown because we have 

moved from one level to another. 

If you can move from career talk 

for SMEs to practising it, then you 

have moved. We have also moved 

in terms of funds because in the 

last programmed, we spent up to 

N300, 000. This has never happened, 

so it is moving but not yet 

to its peak. At the moment, we 

I felt that it was 

high time I discovered 

myself 

and do something 

worthwhile. I went 

back to a series of 

trainings and from 

there; I got a confirmation 

to pass 

that training to 

others 

have not got partners yet. 

What are your challenges? 

One of the challenges that I 

face is that whenever I submit 

proposals, people think that I am 

hungry. I remember when I went 

to a school to submit proposals 

to let me train their students. The 

principal of the school just looked 

at me and started laughing and 

asked me how much I wanted. I 

just told her that I wanted nothing, 

so one of the challenges is 

submitting proposals especially 

for schools. 

Another thing is funding, 

which is not really easy. They say 

that people will want to invest in 

you when they have seen what 

you have done. That is why right 

now I am just making sacrifices. 

I remember when somebody 

called me and said, ‘don’t worry, 

time will come that people will 

want to partner with you’. 

And another thing is venue. 

Venue prices are very high, which 

is why I limit the programmes that 

I do to schools, because they give 

me their hall for free. But on the 

21st of March 2017, when we had 

our first major skills acquisition 

training, I was able to rent canopies 

and space and to the glory 

of God, it was classic and people 

could see the value of what we 

were doing. 

How can these challenges be 

addressed? 

It is students in government 

schools that need our services 

more. When most of them come 

back from school, I see them 

hawking on the streets. I remember 

a particular time I saw 

a three-year-old child hawking 

pears on the streets and I was 

moved. The problem is when you 

go to schools to submit proposals; 

they will not answer you because 

of the high level of bureaucracy. 

It has to pass from one desk to 

another and before you know it, 

the last person that you submitted 

it to will just drop it without 

looking into it. So, if they are not 

even encouraging in submitting 

proposals, how will they solve 

the issue? 

What would you tell your 

younger self? 

I will tell my younger self that 

whatsoever vision he has, the best 

thing to do is not to sleep on it. 

Stop giving excuses but to act on 

it! So I would encourage anyone 

that would be reading this that no 

matter the age, meet people that 

can help you to achieve whatever 

vision you have. 


How FIIRO directors frustrate... 

Kachikwu wrote to the minister, 

but I told them to fix it.” 

Analysts wonder why a government 

agency, which should 

key into government’s ease of 

doing business efforts, seems 

to be sabotaging it. 

“What baffles me is that what 

you just told me happened 

when Nigeria was desperately 

in need of foreign exchange. 

Kachikwu, being a reputable 

exporter to the United States, 

could have exported packaged 

groundnuts and repatriated 

dollars into the economy,” an 

analyst told BusinessDay. 

Another small-scale food 

processor complained to BusinessDay 

that when she applied 

for a fruit juice processing 

machine at FIIRO, it took the 

institute over one month to 

reply her. 

“They later could not even 

produce the machine I requested. 

They gave me a quotation 

running into almost N2 million, 

but when I was ready, they 

became reluctant. This was an 

institute claiming to fabricate 

local machines.” 

Nigerian government recently 

instituted reforms to ease the 

harsh business environment 

in Nigeria, which are mostly 

man-made. 

“For us, it is more important 

that we are able to create an 

environment where small businesses 

and big businesses and 

everyone is able to do business 

effectively in this environment 

and to do so with ease. And I 

think that that is the target we 

have set for ourselves; that the 

time must come, a day must 

come that anyone who comes 

into this country will say ‘I was 

able to do business easily and 

effectively’ and local businesses 

can confirm that it’s just a 

breeze to do business in Nigeria 

and I think that we can really 

achieve that. A lot of it has to 

do with our bureaucracy and 

the way that the bureaucracy 

works,” Yemi Osinbajo, vice 

president, said at the Presidential 

Enabling Business Environment 

Council (PEBEC) Impact 

Awards ceremony held in Abuja 

last December. 

“It is important we change 

our orientation in this country 

and begin to support businesses. 

Businesses are suffering 

and government agencies do 

not need to worsen the challenges. 

Government should be 

an enabler and this must start 

with all government agencies 

and parastals,” Ike Ibeabuchi, 

chief executive at MD Services 

Limited, said.


C002D5556 Monday 09 April 2018 

MondayMorning 

In association with 

Harvard 

Business 

Review 

Emergency responders and the dangers of ‘masculinity contests’ 

OLIVIA A. O’NEILL AND 

NATALYA ALONSO 

During the horrific 

school shooting 

in Parkland, 

Florida, one 

of the sheriff’s 

deputies on the scene did not 

enter the building to confront 

the attacker. The deputy was 

criticized by his boss for his 

supposed inaction and called 

a coward by the president of 

the United States. 

The use of this specific 

word was not accidental. 

More than just failing to act 

as a first responder, “coward” 

implies a much greater 

transgression: failing to 

act as a man. 

Masculinity, we should 

note, has many manifestations 

in organizations. One of 

us (Olivia) has investigated a 

side of masculine organizational 

culture known for what 

psychologists call “companionate 

love.” It involves fondness, 

affection, caring, compassion 

and tenderness — or, 

as first responders would say, 

“camaraderie” or “brotherly 

love.” 

For the past two and half 

years, a working group of 

gender scholars (including 

us) led by Jennifer Berdahl, 

Joan Williams, Peter Glick 

and Marianne Cooper have 

been working to understand 

what happens in organizational 

cultures that conflate 

masculinity with performance, 

or what the working 

group refers to as “masculinity 

contest cultures.” To maintain 

status, such cultures 

require workers (both men 

and women) to “prove” their 

masculinity by engaging in 

behaviors we categorize into 

four groups: “dog-eat-dog,” 

“strength and stamina,” “put 

work first” and “show no 

weakness.” 

Our initial analysis indicates 

that masculinity 

contest cultures are associated 

with numerous harmful 

workplace outcomes such 

as bullying, increased sexual 

harassment, burnout and 

decreased employee wellbeing. 

These outcomes are 

exacerbated when threats to 

masculinity are made public. 

All of this said, first responders 

must make quick 

decisions in life-or-death situations. 

Those involved must 

deal with these situations in 

a professional manner while 

simultaneously negotiating 

the painful emotions that go 

along with them. None of this 

is easy. But it can be done. 

How? In a now-classic 

study of offshore oil workers, 

for example, Robin Ely and 

Debra Meyerson examined 

one approach. The company 

at the center of their research 

implemented an organizational 

culture change initiative 

that decoupled stereotypically 

masculine traits 

prominent in the organization 

(like reckless bravado, 

emotionlessness and never 

admitting failure) in favor of 

competencies aligned with 

better performance (like 

willingness to admit failure, 

relying on and learning from 

others and expressing vulnerability 

and concern). This 

move not only drastically 

improved productivity and 

safety; it also helped men realize 

they could “behave in 

ways that conventional masculine 

norms would have 

precluded.” 

Another antidote to the 

pernicious effects of masculinity 

contest cultures is 

to prioritize the aforementioned 

brighter side of masculinity: 

companionate love. 

Rather than publicly shaming 

an emergency responder, 

as we saw after the shooting, 

this kind of masculine culture 

encourages perspectivetaking 

and caring. 

To be clear: Traits associated 

with masculinity — heroism 

included — in and of 

themselves, are not the problem. 

The problem is when 

masculine traits like heroism 

and emotional stoicism are 

taken to the extreme, leaving 

no room for vulnerability or 

mistakes. 

(Olivia A. O’Neill is an assistant 

professor At George 

Mason University. Natalya 

Alonso is a Ph.D. student 

at the University of British 

Columbia, Sauder School 

of Business.) 

Two techniques for helping employees change ingrained habits 

JOEL CONSTABLE 

I 

first met Eric (not his 

real name) in a new 

manager training 

group I was facilitating. He 

had recently become a manager 

and was excited to learn 

more about his new role. 

Throughout the next two days 

Eric fully immersed himself, 

engaging with other participants 

and actively practicing 

new concepts. At the end of 

the training, Eric committed 

to letting go of more of the 

tactical work he had been doing 

and opening up his time 

to strategic thinking. 

Research by psychologists 

Gabrielle Oettingen and Peter 

Gollwitzer has found that 

doing two things significantly 

increases the likelihood of 

goal achievement in virtually 

every context. The first step is 

considering your ideal future 

state, and the obstacles you 

expect to face on the way to 

achieving that state. Most of 

us do great on the first part. 

But we rarely complete 

the second part: thoughtfully 

considering all the obstacles 

we’ll face. Oettingen calls this 

exercise “mental contrasting” 

and has found that it increases 

the likelihood that we will 

stick with our goals. Anticipating 

obstacles and deciding 

to pursue the goal anyway 

increases our commitment. 

And considering obstacles allows 

us to plan for them. 

The second step here, 

built on mental contrasting, 

involves framing goals as an 

“if-then” statement. The “if” 

is a goal-relevant situational 

cue, and the “then” is your 

goal behavior. Gollwitzer 

calls these “implementation 

intentions.” 

Eric would think about 

what time, situation, or 

circumstance would help 

prompt or remind him to focus 

more on big picture work. 

A few examples: 

— If Eric’s main obstacle 

was not making time, or forgetting: 

“If it’s 9 a.m. on a Friday, 

then I will spend 60 minutes 

focused on our team’s 

strategy and vision for the 

future.” 

— If Eric’s main barrier 

was his satisfaction in completing 

tactical work: “If I’m 

doing work that a member 

of my team could do, then I’ll 

ask her if she can take over 

the work in our next one-onone.” 

— If Eric’s main barrier 

was letting go of control: “If 

I start to feel uncomfortable 

about not completing the 

work myself, then I’ll ask for 

updates on the work in our 

next team meeting.” 

Gurus and coaches often 

tell people to “visualize success,” 

but that’s not enough. 

To really achieve your goals, 

don’t stop there. Think 

through what will get in your 

way, and make a plan for 

overcoming it. 

(Joel Constable is a Director 

of Talent Development at 

Intuit. ) 

(C) (2017) Harvard Business Review. Distributed by New York Times Syndicate


41



C002D5556 

REAL SECTOR WATCH 

Presco pumps N75bn into 

Nigeria’s palm oil industry 

ODINAKA ANUDU 

Presco Plc, one of 

the leading palm 

oil producers in 

Nigeria, says it 

has so far invested 

N75 billion into the industry 

and plans to produce 47,000 

metric tonnes (MT) of crude 

palm oil (CPO) in 2018. 

Felix Nwabuko, managing 

director of Presco, says 

the company plans a capital 

expenditure investment of 

N46 billion over the next five 

years (2018-2022). 

Nwabuko says the investments 

will go into plantations 

development, processing 

facilities, energy infrastructure 

and other supporting 

machinery, equipment and 

infrastructure. 

“Our current capacity is 

63 percent in the peak season 

and 24 percent in the lean 

season. Estimated production 

for 2018 is 47,000 MT 

of CPO. An average annual 

rise of 11 percent is expected 

over next five years,” he tells 

BusinessDay. 

He reveals that the company 

has a total land bank 

of 40,000 hectares, of which 

total planted areas are 20,136 

hectares of oil palm plantation 

and 138 hectares of rubber 

plantation. 

“Our programme with 

smallholder farmers comes 

in the form of making available 

high yielding planting 

materials raised in our own 

nurseries to those who are 

interested,” he states. 

“Corporate social responsibility 

(CSR) is one of the 

three elements of the management 

principles of our 

Group in all the countries in 

100 local, international firms expected at Food West Africa 

Informa Life Sciences 

Exhibitions, a leading 

publishing and 

exhibitions company, 

has returned with 

the 3rd edition of Food 

West Africa – the largest 

B2B food and beverage 

industry platform in West 

Africa. 

The event, which will 

take place at Landmark 

Centre in Lagos, between 8 

and 10 May, is expected to 

attract more than 4,400 industry 

professionals from 

25 countries looking to 

make new wholesale, retail 

and food service contacts 

in the industry. 

Food West Africa will 

host over 100 local and 

international exhibitors 

…to produce 47,000 MT of CPO in 2018 

L-R: Adenrele Onikosi, facilitator; Omotayo Bamishe, head of accounts,Agip; Ighojovbe Oghenekaro, managing director, Agip 

CPFA Limited; Adelowo Adesina, managing consultants, Sages & Scribes Consultants; Yetunde Adeniyi, compliance officer, Agip, 

and Simeon Suopakiriba, facilitator, at the training workshop on ‘Personal Mastery & Value Based Leadership’ organised for Agip 

CPFA Limited by Sages & Scribes Consultants in Lagos 

which it operates. Our CSR 

programme delivers overall 

positive impact and longterm 

improvement on wealth 

creation, education and living 

conditions (job creation, 

equipping schools, scholarships, 

electricity, potable water, 

and roads maintenance, 

among others),” he says. 

On what it will take Nigeria 

to achieve sufficiency 

in palm oil production, the 

managing director says the 

country must take seriously, 

showcasing new F&B products, 

services and equipment 

from across the globe. 

Two new country pavilions 

have been announced 

for the 2018 edition of the 

show – India and Pakistan. 

The Indian food and grocery 

market is the world’s 

sixth largest, with retail 

contributing 70 percent of 

the sales. Similarly, consumer 

industry growth in 

Pakistan is ranked number 

three worldwide. 

The Nigerian wholesale 

and retail industry remains 

a lucrative investment opportunity 

on the back of a 

large and rising population 

with a rapidly increasing 

rate of urbanisation. 

According to Ryan 

a sustained aggressive planting 

of additional hectares 

of oil palm plantations and 

commensurate expansion 

in processing facilities capacities, 

supported with well 

thought-out and well-monitored 

government policies 

together. 

Nigeria produces between 

900,000 and 1.2 million 

MT, out of 2.1 million 

MT local demand. The gap 

is filled by imports from Indonesia 

and Malaysia. Palm 

Sanderson, exhibition director, 

Food West Africa, 

“Nigeria’s household market 

is experiencing strong 

urbanisation, creating 

good opportunities for 

many sectors, particularly 

fast-moving consumer 

goods. Now in its third 

year, Food West Africa has 

firmly demonstrated its 

effectiveness as a medium 

for regional and international 

companies to raise 

their profile in this competitive 

industry sector. As well 

as promoting supply chain 

partnership, along with imports 

and exports, the event 

is a must-attend for F&B 

industry professionals from 

Nigeria and wider Western 

Africa looking to capitalise 

oil is used in foods as well as 

for the manufacture of the 

majority of packaged foods, 

ranging from biscuits to ice 

cream. 

Nigeria has a population 

of 183 million, more than 

half of whom are under 40. 

The combined commercial 

oil palm plantations by Okomu, 

Presco and PZ Wilmar is 

said to be under 900,000 MT, 

while smallholders farmers 

have about 400,000 MT. This 

is still not enough. 

Presco made a revenue 

of N12.825 billion in the first 

half of 2017, from N7.518 

billion in the corresponding 

period of 2016. 

Its profit after tax was 

N5.555 billion, up 84 per 

cent from N3.012 billion in 

the corresponding period 

of 2016. Some experts argue 

that Nigeria needs to plant 

two million hectares of oil 

plam to be self-sufficient, 

which will cost over N2 trillion. 

on the best opportunity in 

the industry.” 

Bestway, the largest 

independent cash and 

carry operator in the United 

Kingdom, and supply 

partner to over 70,000 

independent retailers and 

40,000 catering and foodservice 

operators, has also 

confirmed that it will be 

exhibiting at Food West 

Africa 2018 once again. 

With a UK turnover of £2.5 

billion and a comprehensive 

logistical infrastructure, 

the company has the 

scale, purchasing power 

and expertise to help their 

customers compete in an 

ever-changing food and 

drink sector. 

Once again, local representation 

from Nigerian 

companies is strong with 

key exhibitors such as Just 

Food Limited, ABX Food, 

AgroNigeria, Graceco, and 

Sona Agro Allied Food 

Industries present for the 

three-day event. 

Education is high on 

the agenda at Food West 

Africa 2018 with a two-day 

free-to-attend conference 

that will focus on current 

issues in food supply 

chain management. 

The event continues 

to enjoy firm support and 

backing from the Association 

of Food Vendors 

in Nigeria (AFVN), the 

National Agency for Food 

and Drug (NAFDAC) and 

NASON. 

Abuja Chamber, 

Ukraine Chamber 

sign MoU to raise 

trade volume to 

$2bn 

HARRISON EDEH, Abuja 

The Abuja Chamber 

for Commerce and 

Industry and the 

Ukraine Chamber 

of Commerce have signed 

a memorandum of understanding 

(MoU)to expand 

trade volume between both 

countries to $2 billion. 

The trade volume between 

both countries currently 

stands at a little above 

$93.20 million, which industry 

experts say could be expanded 

with greater partnership 

between both countries. 

Adetokunbo Kayode, 

president of Abuja Chamber 

of Commerce and Industry 

(ACCI), said on Friday at the 

Nigeria-Ukraine business 

forum that the initiative was 

part of efforts to strengthen 

the Economic Diplomacy Initiative 

launched by the federal 

government, geared towards 

bringing international communities 

into partnership 

with Nigerian businessmen 

and private sector. 

“The federal government 

launched on Thursday, the 

Economic Diplomacy Initiative 

and Partnership, and the 

MoU signed between Abuja 

Chamber of Commerce and 

the Ukrainian Chamber of 

Commerce kicks off the target 

of the federal government in 

linking international communities, 

their businesses 

and Nigeria’s private sector.” 

Kayode said the purpose 

of the MoU was to bring the 

businesses of both countries 

together , especially in manufacturing, 

stating that “Ukraine 

has strong equipment,we 

have raw materials here. We 

are bringing them together to 

manufacture every of the value 

chain, in agriculture,agroprocessing,metals 

and so 

forth”. 

“We are looking at a 

minimum of $2 billion investments, 

and we are 

talking of manufacturing 

across the board,whether in 

health,agriculture,metals and 

household goods.” 

“Nigeria is a net importer 

of virtually everything,which 

means if you attract the investors 

to bring in the equipment 

to manufacture here,you 

make lots of money,while 

creating jobs across the value 

chain,”Kayode said. 

In his earlier 

remarks,Valerie Alexandruk, 

Ukrainian Ambassador to 

Nigeria, who led a delegation 

to the forum, said partnership 

between Nigeria and Ukraine 

would be better facilitated 

given that the Nigerian delegation 

had earlier visited Ukraine 

to cement a partnership.


BUSINESS DAY 

43 

CITYFile 

Simon Hercules, 

director of New 

Hope Medical 

Centre (r), attending 

a 75 years old 

patient, during the 

Aisha Bala Wunti 

Free Medical 

Treatment to over 

500 patients at 

Bauchi State General 

Hospital in 

Bauchi on Friday. 

NAN 

Anchor Borrowers’ progrmme: 

500 receive inputs in Bayelsan 

SAMUEL ESE, Yenagoa 

About 500 farmers in Bayelsa 

have received various farm 

inputs under the first phase 

of the Central Bank of Nigeria 

(CBN) Anchor Borrowers’ 

Programme. 

Ezekiel Ogbinko, chairman, Rice 

Farmers Association of Nigeria (RIFAN), 

Bayelsa chapter, disclosed this in Yenagoa 

on Friday while flagging off the second 

phase of the programme for the 2018 

farming season. 

180 survived fire outbreaks as N86m goods saved in Kano 

ADEOLA AJAKAIYE, Kano 

Over 180 persons survived fire 

outbreaks in different parts 

of Kano State just as goods 

estimated at N86 million were 

rescued in March this year. 

Saidu Mohammed, spokesperson of 

Kano State Fire Service, who released the 

5,000 charged with traffic offences in Anambra 

The Federal Road Safety Corps 

(FRSC) says it has apprehended 

and prosecuted more than 

5,000 persons for various traffic 

offences in Anambra in the first quarter 

of 2018. 

Disclosing this to newsmen, weekend, 

Sunday Ajayi, the sector commander said 

that the command also prosecuted over 

100 offenders for various offences at a mobile 

court session during just concluded 

Easter celebration. 

statistics on Friday, however, regretted the 

loss of 14 lives in the incidents. 

Mohammed said 41 houses and 69 

shops were affected in the fire outbreaks 

while properties valued at N29 million 

were destroyed during the period. 

He said that the service received 124 

rescue calls and 24 false alarms from 

residents during the month. 

Ajayi said that the most prevalent traffic 

offences committed by the offenders 

included drivers’ license violation, overloading, 

non-use of seat belt and failure 

to install speed limiting device. 

According to him,the arrests, especially 

during the Easter period, were part 

of measures aimed at raising the consciousness 

of motorists on safety issues 

on the highway. 

Ajayi blamed the increase in accidents 

on speed, mechanical problems and envi- 

He said that some of the items distributed 

included 1, 200 bags of fertiliser of 

various types, 400 cans of herbicides and 

sprayers, among others. 

The chairman noted that the distribution 

of the inputs was aimed at ensuring 

mass production of rice through a revolving 

loan procedure, in line with the 

objectives of the programme. 

“Right now in the state, we have over 

4,000 farmers working on the 20,000 hectares 

of land cleared for the dry season rice 

faming. The farm sites are at Ondewari 

and Okpotuwari communities in Southern 

Ijaw local government area,” he said. 

Ogbianko, however, warned the farmers 

against diversion of the items, adding 

that the programme was part of the Federal 

Government’s efforts toward achieving 

food security. 

Stanley Oruyeigha, head of finance, 

CBN, Yenogoa, commended RIFAN’s activities 

in the state and urged the farmers 

to make good use of the items received. 

Oruyeigha also called on the youths in 

the state to take advantage of the anchor 

borrowers’ programme and key into 

farming. 

According to Mohammed, the major 

causes of the fire were the use of inferior 

electrical materials, poor handling of 

electrical appliances, cooking gas and 

boiling ring as well as accidents. 

He advised the general public to be 

careful in this dry season in handling fire 

and stop storing petroleum products to 

avert fire outbreak. 

ronmental factors. He warned motorists 

against flouting traffic rules. 

He, however, said the corps would 

intensify its public enlightenment and 

advocacy programmes in collaboration 

with stakeholders to reduce accidents on 

the highway. 

He commended other security agencies 

for collaborating with the corps in its 

operations and appealed to motorists plying 

the state to cooperate with the corps 

for the safety of all road users. 

Ambode challenges workers 

to do more with less 

JOSHUA BASSEY 

Governor Akinwunmi Ambode of 

Lagos says he expects workers in 

the state public service to optimize 

their tasks and not use limited resources at 

their disposal as an excuse for unimpressive 

productivity. 

Ambode stated this at a training session 

for select workers, held last Thursday, in 

Ikeja, saying it was in the overall interest of 

the state for public servants to provide optimum 

services at limited cost. 

Represented by Akintola Benson Oke, the 

commissioner for establishments, training 

and pensions, Ambode, at the training with 

theme “adopting the lean process improvement 

culture in the civil service to further 

reduce waste and optimise productivity,” 

emphasise the need to eliminate waste. 

“If the Lagos State civil service is able 

to perfect the art of lean management and 

operations, the service will become able 

to eliminate the so-called “three sources of 

loss” which are waste, variability, and inflexibility,” 

the governor said. 

He further explained that a lean operational 

system would also ensure that 

the Lagos State civil service created and 

maintained the beneficial ability to improve 

itself constantly by bringing problems to the 

surface and resolving them. 

According to the governor, in this area, 

the public sector often found itself in a 

weaker starting position when compared to 

private sector entities, with gaps in skills and 

entrenched mind-sets. 

Ambode said the major goal of the training, 

therefore, was to identify and codify the 

methods, means, and strategies for ensuring 

that the state civil service was positioned to 

do more with less, adding that “at the end 

of this training, Lagos state civil Service and 

her officers should be able to produce even 

more outstanding results with less money, 

less personnel, and in less time.” 

Govt restructures project 

‘Clean up Edo’ 

Edo state has also repositioned the project 

Clean up Edo Committee headed by 

Osarodion Ogie, secretary to the state 

government as a taskforce to clean up the state. 

Ogie with the repositioning of the task force, 

the residents are to ensure regular environmental 

sanitation around their surroundings, 

noting, “the state government frowns at the 

situation where citizens have continued to disregard 

environmental laws on waste disposal 

and use of social amenities in the state.” 

According to him: “The state government 

will not hesitate to invoke relevant provisions 

of extant laws in prosecuting persons, who 

dispose of refuse indiscriminately in the state, 

as mobile courts have been established to 

prosecute offenders. Owners of uncompleted 

buildings and vacant lands are to clear and 

keep such places free from weed and refuse.” 

2 bag 12 months for 

stealing N3,000 phone 

A 

Karmo Grade 1 Area Court in Abuja 

has sentenced one Obinna Ezeh and 

Samson Odeh to six months imprisonment 

each for stealing a cell phone valued 

at N3, 000. 

The judge, Abubakar Sadiq, sentenced 

Ezeh and Odeh who admitted committing 

the offence, but gave them an option of 

N20,000 fine each. 

Sadiq advised the convicts to desist from 

committing crimes, adding that the sentence 

would serve as deterrent to others. The duo 

were convicted on a two-count charge of 

joint act and theft.


NEWS 

NNPC, contractors sign agreement for 

$2.8bn Ajaokuta-Kano gas pipeline project 

OLUSOLA BELLO & HARRISON EDEH 

The construction of 

the over $2.8 billion 

Ajaokuta - Kaduna 

- Kano gas 

pipeline, expected 

to supply gas to the proposed 

1,000 megawatts Abuja power 

plants and other users, is 

expected to take off any moment 

from now. 

This is because the Nigerian 

National Petroleum 

Corporation (NNPC) has 

signed agreement with two 

consortia for the Engineering, 

Procurement and Construction 

(EPC), and commissioning 

of the project under a 100 

percent contractor financing 

model for Lots 1&3 of the 

40inch x 614km project. 

One of the consortia is a 

mixture of indigenous and 

foreign contractors. Under the 

terms of contract, Lot 1 with 

total length of 40inch x 200km 

stretching from Ajaokuta to 

Abuja Terminal Gas Station 

was awarded to the OilServe/ 

Oando Consortium. While 

Lot 3 that runs from Kaduna 

Terminal Gas Station (TGS) to 

Kano TGS with total length of 

40inch x 221km was awarded 

to the Brentex/China Petroleum 

Pipeline Bureau (CPP) 

Consortium. 

It is envisaged that contract 

agreement for Lot 2, 

which covers 40inch x 193km 

stretching from Abuja to Kaduna, 

will be executed in 

the weeks ahead. Under the 

terms of contract, Lot 1 with 

total length of 40inch x 200km 

stretching from Ajaokuta to 

Abuja Terminal Gas Station 

was awarded to the OilServe/ 

Oando Consortium. 

Maikanti Baru, group 

managing director of the 

NNPC, while speaking at the 

signing ceremony, said the 

AKK Gas pipeline was a section 

of Trans-Nigerian Gas 

Pipeline under the gas infrastructure 

blueprint designed 

to enable the industrialisation 

of the Eastern and Northern 

parts of Nigeria. The project 

will also enable connectivity 

between the East, West and 

North, which is currently nonexistent. 

The AKK section has suffered 

setbacks due to scarce 

resources for government to 

fully finance the project, hence 

the adoption of the contractor 

financing model, he said. 

“The two other pipelines, 

the OB3 & ELPs 2 in the Gas 

Master Plan blueprint, are 

currently at various stages of 

completion and are being financed 

directly by the Federal 

Government,’’ he said 

In his remarks on behalf 

of the Oilserve/Oando Consortium, 

Emeka Okwuosa, 

chairman of Oilserve Limited, 

expressed gratitude to 

the Federal Government and 

the NNPC for providing the 

opportunities for indigenous 

companies to flourish in the 

Nigerian oil and gas industry. 

According to Okwuosa, 

the decision to award Lot 1 of 

the AKK project to an indigenous 

consortium speaks volume 

of government’s resolve 

to grow and encourage the attainment 

of the ideals of local 

content philosophy. 

Abubakar Nuhu, vice 

chairman of Brentex Nigeria 

Limited, said the Brentex-CPP 

Consortium would rely mainly 

on the acclaimed pedigree 

and global expertise of CPP in 

pipeline construction to deliver 

a world-class project. 

It would be recalled that 

the process for the award of 

the AKK project took off in 

July 2013, with the advertisement 

for tenders published 

by the NNPC in major 

national newspapers. 

After a painstaking 

technical and commercial 

evaluation process, the 

Federal Executive Council 

(FEC), at its 46th meeting 

on December 13, 2017, approved 

the contract valued 

at over $2.8 billion. 

Stakeholders task FG to tackle 

corruption in immigration service 

ANTHONIA OBOKOH 

A 

legal rights group 

has called on the 

Federal Government 

to tackle 

corruption in Nigeria Immigration 

Service (NIS) 

command across the 

country, saying it will reduce 

the fraud and pressures 

from the embassies. 

This call was made at 

a press conference convened 

by Prince Williams- 

Joel, managing partner, 

Prince Joel & Associates, 

and partner at NOVO IN- 

IZIO LLC, at the unveiling 

of the firm’s immigration 

clinic sessions and supplementary 

services in 

Lagos. 

“Tackling the menace 

of corruption is not an 

easy task, but it ispossible,even 

if many feathers 

have to be ruffled.If our 

government has a resolute 

commitment to tackle 

corruption, Nigeria needs 

to address growing concerns 

and dearth of practical 

knowledge of visa 

application requirements, 

practice, procedure and 

other immigration related 

matters to visa applicants,” 

Williams-Joel said. 

According to Williams- 

Joel, the immigration 

clinic is a hub for issues 

relating to visa, as the firm 

is worried by the influx of 

touts who have completely 

and effectually taken 

over visa applications and 

immigration related services 

from professionals 


The week-on-week 

foreign exchange 

turnover declined 

by 16 percent to $1 

billion ($195.3m) from $1.2 

billion recorded in the previous 

week at the investors 

and exporters forex window. 

At the Nigerian Autonomous 

Foreign Exchange 

(NAFEX) rate opened the 

week appreciating 17 kobo 

to N359.83/$1 from N360/$1 

at the prior Thursday’s close. 

By midweek, the rate depreciated 

to 21 kobo to close at 

N360.04/$1 and appreciated 

3 kobo to N360.01/$1 the 

subsequent day. 

However, NAFEX rate 

appreciated 13 kobo W-o- 

W to close at N359.87/$1 

compared to N360/$1 in the 

previous week, according to 

a report by Afrinvest Securities 

Limited. 

The CBN continued its 

weekly interventions of $210 

million via the Wholesale 

SMIS (Secondary Market Intervention 

Auction). Consequently, 

rates traded flattish 

within tight bands during 

the week. 

Following the resumption 

of financial markets after 

the Easter holidays, the 

week opened flat on Tuesin 

Nigeria. 

In return, they offer 

poor and abysmal immigration 

related services to 

visa applicants with the 

attendant consequence of 

perpetual increase in the 

percentage of numbers of 

visa denials from foreign 

embassies, high commissions 

and consulates. 

Michael Damiari, immigration 

attorney and 

head of chambers, Prince 

Joel & Associates, speaking 

on the denial of visa, 

said it was not a myth that 

no fewer than 220,000 Nigerians 

apply for non-immigrant 

visas every year. 

“It is proven that several 

unemployed intended 

emigrants use touts 

and miscreants under the 

guise that they are travel 

agents to apply for visa for 

them,” Damiari said. 

However, Charles Ejiogu, 

an attorney at law 

admitted to the New York 

Bar and Federal District 

Court, advised Nigerians 

to always know what visa 

they want before applying, 

in relations to advice 

and assistance, the immigration 

clinic was open to 

all citizens to reach out for 

more knowledge on visa 

application. 

The immigration clinic 

is a strategy and innovation 

introduced by the firm to 

address growing concerns 

and dearth of practical 

knowledge of visa application 

requirements, practice, 

procedure and other immigration 

related matters. 

L-R: Oliver Alawuba, executive director, United Bank for Africa (UBA) plc; Emmanuel N. Nnorom, group CEO, Heirs Holdings and 

celebrant; Florence Nnorom, wife of the celebrant; Tony Elumelu, chairman, Heirs Holdings and UBA plc, and Haruna Jalo-Waziri, MD/ 

CEO, Central Securities Clearing System (CSCS) plc, at the 60th birthday celebration of Emmanuel Nnorom in Lagos, at the weekend. 

Experts explore right policies to grow real estate in Nigeria 

THEODORA KIO-LAWSON 

In a bid to address 

challenges militating 

against the progress of 

the real estate sector in 

Nigeria, legal and real estate 

experts in Nigeria are seeking 

the right policies to help 

drive its growth. 

Speaking at the seventh 

Detail Business Series in 

Lagos organised by Detail, 

Nigeria’s first commercial 

solicitor firm specialising 

in non-court room practice, 

Andrew Nevin, partner 

and chief economist, PwC, 

said the real estate was not 

growing, as it should because 

of land registry. 

Navin said, “Land registry 

has delayed the progress 

of the real estate sector. It 

is delaying its investment, 

which is costly. In Lagos, we 

need approximately 5 million 

dwellers and we are not 

getting them as expected as 

a result of the land registry.” 

According to Navin, the 

right economic policy will 

go a long way in improving 

the real estate sector. 

“At PwC, we are trying to 

push forward the most suitable 

economic policy for 

the real estate and for the 

country as a whole, because 

if real estate sector doesn’t 

work, nothing else works. It 

should be the biggest employer,” 

he said. 

Sonnie Ayere, CEO, 

Dunn Loren Merrifield, 

said the real estate had a 

whole lot of disrupting factors 

restraining its progress 

in Nigeria, especially in the 

area of raising enough fund 

to secure a house, shopping 

space and the likes. 

“In trying to develop, it 

is important to know how 

to raise money right. One 

means foreign countries 

raise money is through the 

‘Crowd funding’ where 

many people come together 

to raise money. This practice 

cannot be visible in Nigeria 

because the law is out 

rightly against such practice 

here. But we are looking for 

a way around such law so 

that it can seize being practiced 

in Nigeria, ”Ayere said. 

The mortgage terms and 

agreements are also bottlenecks 

to eliminate in the 

sector, he said. He therefore 

advised people who embark 

on mortgage skill to 

rather go for ‘loss of work 

insurance,’ which to him 

was more suitable and affordable 

for those who want 

to secure and own a house. 

The ‘loss of work insurance’ 

covers for a minimum 

of one year peradventure 

there are any incidences, 

he said, adding that in cases 

where people lose their 

jobs, it pays the mortgage 

for 12 months, and sometimes 

another six months 

giving them enough time 

until they secure a new job. 

Toyin Ajose, associate 

partner heading Detail’s 

real estate and construction 

practice, said this was the 

seventh detail series but the 

first time to focus on real estate, 

adding that the theme, 

’Navigating the evolving 

real estate marketplace – 

dealing with market disruptors’ 

was timely and apt. 

Ajose said, “We try to focus 

on our practice areas. 

We look out for what is new 

and relevant so as to draw 

attention to that area so that 

people are positioned to 

benefit from the changes in 

the market.” 

She said the issues that 

suppress the real estate 

prompted them to call in 

experts to speak on them. 

Forex turnover declines 16% at investors’ window 

HOPE MOSES-ASHIKE 

day with the CBN spot rate at 

N305.65/$1, and this appreciated 

5 kobo to N305.60/$1 

by midweek, which remained 

constant throughout 

the week. The parallel market 

rate opened flat at N362/$1 

and remained unchanged till 

the end of the week. 

The total value of open 

contracts of the Naira settled 

OTC futures in the FMDQ 

OTC futures market improved 

by $57.2 million, representing 

a 1.8 percent W-o- 

W growth to $3.3 billion on 

Friday from $3.2 billion last 

week close. Nonetheless, the 

APR-2018 instrument was 

the most subscribed with a 

total market value of $660.5 

million (contract price: 

N360.31/$1), while the 

MAR-2019 was the least subscribed 

with a total market 

value of $8.8 million (contract 

price: N361.96/$1). 

Analysts Cowry Assets 

Management Limited and 

Afrinvest expect rates to 

continue to trade within 

tight bands, as the apex bank 

remains committed to sustaining 

its foreign exchange 

interventions in the face of 

domestic macroeconomic 

and external sector positives, 

including the steady 

accretion to the external reserves.


Moyanga joins board of 

Africa Franchise Centre 

FRANK UZUEGBUNAM 

Former chairman of the 

Franchise Association 

of South Africa (FASA) 

and one of Africa’s 

most notable names in the 

area of franchising and small 

enterprise development, Peter 

Sipho Moyanga, has joined the 

advisory board of Africa Franchise 

Centre (AFC). 

AFC is a private sector-led 

initiative to increase prosperity 

and support growing 

businesses by promoting 

franchising as a business development 

model. 

The Africa-wide initiative 

was launched in Lagos in November 

2017 at a ceremony 

attended by franchise business 

leaders and commercial 

diplomats from US Embassy 

and many African countries. 

Moyanga, an expert in the 

field of franchising, property 

and business development, is 

known to have done pioneering 

work in the development of 

franchising across Africa, leading 

workshops and training 

sessions in partnership with African 

Development Bank and 

other development agencies. 

Moyanga has been involved 

with McDonalds Corporation 

in South Africa since 

1995, having been one of their 

first employees when the corporation 

entered that market. 

He served as multi-department 

head, responsible for 

information and technology 

department, operations development, 

field service and 

franchising. 

He left corporate life to 

become an owner operator 

(franchisee), and currently 

owns many McDonald’s outlets 

in South Africa, through 

his company, Moyanga Family 

Foods. He is also a director 

$1bn ECA withdrawal: Senate decries 

Buhari’s lack of consultation 

OWEDE AGBAJILEKE,Jos 

Senate president, Bukola 

Saraki, has expressed 

disappointment with 

President Muhammadu 

Buhari’s approval of $1 

billion from the Excess Crude 

Account (ECA) to fight the rising 

spate of insecurity across 

the country, without recourse 

to the National Assembly. 

Saraki also disclosed that 

lawmakers were unhappy 

with the Executive arm of 

government for lack of consultation 

with the Legislature 

on the matter. 

Saraki revealed this on Saturday 

while declaring open 

the 2018 Senate Press Corps 

retreat in Jos, the Plateau State 

capital. The Senate resumes 

from Easter break on Tuesday, 

April 10, and the matter is 

expected to top agenda upon 

resumption. 

Delivering his address, the 

Senate president disclosed 

that the lawmakers had 

equally expressed their disappointment 

to him that they 

were not consulted before 

the President unilaterally apof 

Moyanga Louw and Associates, 

a firm of SME and Franchise 

Development experts. 

Peter, a Wits Business 

School graduate of Business 

Administration (MAP), has 

been an independent nonexecutive 

director of Vukile 

Property Fund Limited since 

2004. He is also a non-executive 

director at Brikor Limited. 

He is also on the board of 

Notshi Investments (Pty) Limited 

and served as board chairman 

of Medishield Medical Aid 

Scheme, one of South Africa’s 

foremost medical aid schemes. 

He is also a long-serving national 

director of Reach for a 

Dream Foundation. 

Moyanga joins an Advisory 

Board of AFC, which already 

has such known names 

as Brent Omdhal, US commercial 

counsellor to Nigeria; 

Anayo Agu, former senior 

commercial specialist at the 

US Commercial Service in Nigeria, 

and now special adviser 

to Enugu State government 

on Small and Medium Enterprises 

and Investment Promotion; 

Antoine Zimmariah, 

franchisee for Domino Pizza, 

and Coldstone Creamery in 

Nigeria, as well as Pat Utomi, 

chairman, Centre for Values 

and Leadership. 

proved the funds, and called 

for reform of security architecture 

in the country. 

“There is no way the security 

architecture of this country 

can work without a strong 

synergy between the executive 

and the legislature. When 

you see certain agencies who 

by their actions and utterances 

frustrate the relationship 

between the two arms, you 

begin to wonder. 

“What do we need to do? 

Do the police need more 

funding or more powers? Do 

they need new legislations to 

strengthen them. These are 

the issues where the executive 

and the legislature must work 

together. 

“Just few days ago, where 

the issue of providing funding 

for the purchase of security 

equipment. In a good environment, 

such an issue needed 

to have been discussed 

with lawmakers. Already, 

some senators are angry. 

They said the executive did 

not consult them before such 

a decision was taken. These 

are the issues we are talking 

about.” 

C002D5556 

BUSINESS DAY 

45 

NEWS 

L-R: Chidi Amuta, keynote speaker; Okey Akpa, MD, SKG Pharma, and Pat Iloba, general manager, sales and marketing, SKG 

Pharma, during the annual trade partners conference in Lagos, yesterday. 

Pic by Olawale Amoo 

Ismai’la Muhammadu Zakari, president, Institute of Chartered Accountants of Nigeria (ICAN) (r); with Wale Mokuolu, chief 

executive/managing partner, Mokuolu Rubens & Co. Chartered Accountant/special guest, at the ICAN award of accreditation/ 

recognition certificates to tertiary institutions and tuition center in Lagos, at the weekend. 


BusinessDay’s agribusiness summit holds April 27 

CALEB OJEWALE 

BusinessDay’s annual 

Agribusiness 

and Food Security 

Summit is set to 

hold April 27, at 

the Landmark Event Centre 

in Lagos, where stakeholders 

across different value 

chains will proffer solutions 

to some of the sector’s pressing 

concerns. 

Some of the confirmed 

specials guest and speakers 

at this year’s summit include 

Audu Ogbeh, minster for 

agriculture and rural development, 

Godwin Emefiele, 

governor, Central Bank of 

Nigeria, and Godwin Obaseki, 

governor, Edo State. 

This year’s keynote 

speaker is Hans-Willem van 

der Waal, managing director 

of AgroFair, a company 

that imports Fairtrade and/ 

or organic certified bananas, 

pineapples and other tropical 

fruits mainly from Cen- 

NNPC says group financial statements up to date 


Nigerian National 

Petroleum Corporation 

(NNPC) says 

it has completed 

outstanding audit of the 

group financial statements 

from year 2011 to 2016. 

The audited backlog, the 

corporation says, has been 

formally approved by the 

Board of the corporation in 

line with extant laws governing 

the operations of the 

national oil company. 

Providing details of the 

development in an exclusive 

interview published 

in Q1 2018 edition of the 

NNPC Magazine, Isiaka 

AbdulRazaq, chief financial 

officer/group executive 

director, Finance and Accounts 

of the NNPC, said 

the delivery of the audited 

financial statements would 

help foster better relations 

tral and South American 

countries, and distributes all 

over Europe out of its Rotterdam-based 

logistics centre. 

Hans-Willem is also an administrator 

of ColeACP, the 

association of importers and 

exporters of the Africa Caribbean 

Pacific countries. 

The Agribusiness summit 

is themed ‘Evolving actionable 

models and innovations 

to make Agribusiness more 

viable.’ The summit this year 

will take a pragmatic approach, 

as focus areas will 

not be platforms to discuss 

problems, rather, to advance 

solutions that will fix germane 

problems plaguing 

the country’s agricultural 

sector. Individuals and organisations 

(both local and 

international), that have 

cognate experience and outstanding 

success rates in the 

focus areas, will participate 

in discourse on solving these 

problems in Nigeria. 

The audience will get 

with stakeholders and further 

promote transparency 

and accountability in the 

corporation. 

AbdulRazaq, in a statement 

issued by the corporation 

on Sunday, said the 

drive to achieve the clean 

slate dated back to August 

2015, when the current 

management of the Finance 

and Accounts Directorate 

took over the mantle of leadership 

and inherited a total 

of 65 unaudited financial 

statements for NNPC Group 

Corporate and its subsidiaries, 

covering 2011 - 2014. 

“There were, undoubtedly, 

challenges that led to 

the backlog which may have 

been beyond the control of 

the previous managements. 

However, the important factor 

was not to look to the 

past. We saw an opportunity 

to learn from the insights 

shared, and also interact 

with these entities and other 

participants at the summit. 

Focus areas for this year’s 

summit include Practical 

Access to Finance; as funding 

remains a critical issue in 

Nigeria’s agricultural development, 

players in different 

parts of the value chain remain 

unable to secure funds 

for expansion and improve 

productivity. 

This summit aims to 

champion purposeful discourse 

on innovative, effective 

funding models that 

will offer a definitive solution 

to this problem in Nigeria. 

The second focus area 

will attempt to solve the 

problem of Supply Chain 

Integration. Even when 

funding is available, the 

uncertainties of accessing 

a market in good time and 

at the right price are a very 

discouraging element for 

to challenge the problem 

and resolved to clear the arrears 

in the shortest possible 

time,’’ the NNPC CFO said in 

the statement. 

The statement pointed 

out that the NNPC management 

constituted a Project 

Steering Committee (PSC) 

under the chairmanship of 

AbdulRazaq, which met on 

a weekly basis with the auditors 

and all relevant stakeholders 

to identify and isolate 

key challenges and give 

them priority attention. 

“With this approach, 

Management achieved the 

first step of concluding the 

audit of the 2011 – 2012 financial 

positions and presented 

same to the Board 

in 2016 and in recognition 

of that modest achievement, 

the NNPC Board 

further mandated Manage- 

agribusiness investment in 

Nigeria. Post-harvest losses 

remain of serious concern 

to producers and other 

players in the agriculture 

value chain and needs more 

strategic efforts to be adequately 

addressed. 

This panel will chart a 

course on making the process 

from farm to market 

better streamlined; creating 

an efficient supply 

chain system that is based 

on well-defined marketing 

mechanisms and pricing. 

The third focus area is 

one innovations driving agribusiness 

development. 

Technology is increasingly 

driving agribusiness in many 

ways, but the possibilities 

still remain endless. Experts 

with innovations in funding, 

seedlings, and mechanisation 

will offer insights into 

how different technologies 

can be used to further advance 

agricultural development 

in Nigeria. 

… embarks on integrity audit of over 5,000km pipeline network 

ment to clear the remaining 

outstanding reports for the 

years 2013 – 2016 and the 

result today is the delivery 

and Board approval of the 

audited Group Financial 

Statements as at 31 December 

2016,’’ he said. 

Also, in the publication, 

managing director of the 

Nigerian Pipeline and Storage 

Company (NPSC), Luke 

Anele, revealed plans by 

the company to embark on 

comprehensive audit of the 

over 5,000km of petroleum 

products and crude oil pipelines 

under its watch. 

According to Anele, the 

project, which has already 

been approved by the NNPC 

management, is to be executed 

by the National Engineering 

and Technical Company 

(NETCO), an upstream subsidiary 

of the NNPC Group.


C002D5556 


NEWS 

BPE finalises plans to sell Yola , Afam Power... 


rity in the sale and management 

of public assets. 

Alex Okoh, director-general, 

BPE, made this known at the 

joint kick-off meeting of the 

transaction advisers for the 

privatisation of Afam Power 

Generation Plant and Yola Power 

Distribution Company in Abuja, 

last week. 

According to a statement by 

Amina Tukur Othman, head, public 

communications of the Bureau, 

Okoh said the Bureau had raised 

the bar for privatisation transactions, 

adding that stakeholders 

would be carried along throughout 

the entire stages of the transactions. 

The director-general noted the 

criticism that trailed the initial privatisation 

of the power companies, 

and said the lessons learnt in the 

previous exercise would be applied 

to set a standard for the fresh 

transactions, as transparency and 

professionalism were vital to all the 

Bureau’s transactions. 

On the emergence of FBN Quest 

L-R: Emmanuel Eze, 

executive director/ 

chief technology officer, 

SystemSpecs 

Limited, representing 

John Obaro, the 

managing director, 

who was conferred 

with Institute of Software 

Practitioners of 

Nigeria (ISPON) professional 

fellowship; 

Imoke Liyel, former 

governor, Cross River 

State; Adebayo Shittu, 

minister of communications, 

and James 

Emadoye, president, 

ISPON, at the 2018 

president’s dinner with 

theme, The Fourth 

Industrial Revolution, 

a golden opportunity 

for Nigeria in Lagos. 


Consortium as the sole transaction 

adviser for Yola and Afam Power 

companies, he said there was 

nothing untoward about it, rather 

“it is in furtherance of the Bureau’s 

stance on transparency because 

the Consortium participated in 

the two distinct bidding processes 

for the selection of transactions 

advisers and emerged as the preferred 

bidder for Yola Power Company 

and reserved bidder for Afam 

Power Company.” 

According to him when negotiations 

with the preferred bidder 

- Energy Markets & Rates 

Consortium (EMRC) for advisory 

services for Afam Power Company 

transaction fell through, the Bureau 

made recourse to the reserve 

bidder – FBN Quest in line with 

best practice. 

While expressing confidence 

in FBN Quest’s ability to deliver on 

both transactions, Okoh pledged 

the Bureau’s support towards ensuring 

the success of the standards 

to be set in the fresh transactions. 

However, in response, Taiwo 

Okeowo, deputy managing director, 

FBN Quest Consortium, 

said the Consortium’s goal was to 

partner the BPE to set an improved 

standard in the course of the transactions 

and post-transaction activities. 

To achieve this, Okeowo 

said, a team of professionals 

cutting across technical experts, 

legal services, as well as 

financial experts were on board 

to execute the task. 

It would be recalled that although 

Yola Distribution Company 

was successfully privatised and 

handed over to the core investor in 

2013, a force majeure was declared 

in 2015 by the core investor, citing 

insecurity in the North-East region 

of Nigeria. 

Following this, the company 

was duly repossessed by the Federal 

Government. The transaction for 

Afam Power Generation Company 

on the other hand fell through due 

to the delay in signing the Gas Supply 

Agreement (GSAA) and the Gas 

Transportation Agreement (GTA). 

In 2017 the National Council 

on Privatisation gave approval for 

a fresh transaction to privatise the 

two power companies. 

APC set to reverse tenure elongation for... 


of Kano State, speaking to some 

selected newsmen in Abuja disclosed 

that the earlier decision of 

APC NEC which favoured tenure 

extension will be reversed. 

Governor Ganduje also revealed 

that today’s NEC meeting 

is expected to decide on date and 

time table for Congresses and 

convention of the party which will 

produce party officials at all levels. 

He said few APC governors 

who were campaigning for what 

he described as “illegal” tenure 

elongation have been convinced 

to discard such moves. 

“Let me tell you the issues involved, 

those who are advocating 

for tenure elongation, they are 

advocating on the premise that 

when we hold congresses and 

convention according to their own 

perception, there will be a lot of 

problems and that problem will 

linger into election period. Well 

that is a perception, it could be 

that way and it could be that some 

people wanted to retain power. 

“The constitution of our party 

has made a provision for four years 

and at the end of it we have to hold 

congresses and convention. The 

constitution of Nigeria has also 

provided for that, so we have no 

reason whatsoever. 

“So for those who thought they 

would be able to continue, we said 

no and so I think Mr. President 

finally hit the nail on the head, by 

saying that he is not in favour of any 

tenure elongation. 

“Tenure elongation is undemocratic, 

it may lead us to litigation 

which will not be good for the party 

and we are happy that we have 

convinced the few governors that 

were for the elongation. 

“I think that is the situation and I 

am happy to say that the chairman 

of the Nigeria Governors Forum 

issued a statement, the chairman 

of the APC governors Forum also 

issued a statement and the national 

chairman of the party Chief John 

Oyegun made a statement as well 

to say that all is well,” the Kano 

Governor maintained. 

Meanwhile, the APC described 

as false, allegations by Reno 

Omokri, erstwhile Special Assistant 

to Former President Goodluck 

Jonathan on New Media which 

was contained in April 5, 2018 

report published on the website 

of Vanguard Newspapers, titled: 

‘APC secretly reaching out to me 

for friendship’. 

Edegbe Odemwingie, Assistant 

Director of Publicity, APC National 

Secretariat in a statement 

made available to newsmen in 

Abuja said the report shows that, 

Omokri’s allegation is based on 

interactions he had on twitter with 

one Philip Obin who manages a 

twitter handle, “@APCNigeria”. 

Odemwingie stated that the 

Party had on several occasions distanced 

itself from the now notorious 

twitter handle, “@APCNigeria” 

following unauthorized tweets and 

subsequent false reports credited 

to the Party on the outcome of 

the Benue South Senatorial rerun 

election and an assessment poll 

on President Muhammadu Buhari 

Administration among others. 

He said despite APC rebuttals, 

Obin has continued to impersonate 

the Party through the twitter 

handle, “@APCNigeria”. 

“For the avoidance of doubts, 

we wish to state that Philip Obin 

was one of the numerous youth 

volunteers for our party during the 

2015 elections. He administered 

the Twitter handle at the time. But 

despite numerous appeals to him 

by various well meaning party 

representatives, to hand over the 

handle, Obin has refused and in 

defiance continues to use it to 

misrepresent the Party. 

“In essence, therefore, Obin’s 

interactions with Omokri are 

in his personal capacity and do 

not involve the Party in any way. 

Given this latest incident, the 

Party is now left with no option 

than to take other lawful actions 

to restrain Obin from further embarrassing 

the Party. The general 

public is yet again reminded that 

the Twitter handle @APCNigeria 

is not a Twitter handle of the All 

Progressives Congress,” Odemwingie 

stated. 

Shebah Petroleum drags feet on $143m loan... 


against it by three creditor banks 

following a $150 million loan 

repayment default, was thrown 

out of a London court last year. 

On July 1, 2011, Nigerian 

lenders- Diamond and Skye 

Banks, as well as Egypt-based 

Afrexim Bank lent US$100 million 

to Shebah under a pre-export 

finance facility agreement, 

a figure that was later amended 

to $150 million on May 11, 2012, 

with each bank advancing $50 

million, according to a court 

document seen by BusinessDay. 

The banks claim that since a 

US$6.1 million payment in June 

2012, Shebah has made no further 

repayments. 

This led the banks to file a 

lawsuit demanding the balance 

repayment by Shebah and the 

two guarantors of the loan, ABC 

Orjiakor, Shebah’s President and 

Allenne Limited, one of Orjiakor’s 

trading companies. 

Shebah made an unsuccessful 

appeal at the Royal Courts of 

Justice Strand, London on June 

28 2017 to negotiate a lesser payment, 

as the court ruled that the 

entirety of the sums claimed by 

the claimants (the three creditor 

banks) are due and payable by 

the appellants (Shebah, Orjiakor 

and Allenne Ltd). 

“The claimants have accelerated 

Shebah’s entire debt 

pursuant to Clause 24.17 of the 

Facility Agreement (such that it 

is immediately due and repayable), 

and have made demands 

on Allenne and Dr Orjiako under 

their respective guarantees,” the 

court document seen by BusinessDay 

read. 

“The appellants sought to argue 

that the claimants could not 

rely on the acceleration or the 

demands. This argument was 

rejected by the judge, and has 

not been renewed,” the document 

read. 

Shebah was not immediately 

available to say if other appeals 

have been made after then. 

Diamond bank’s spokesperson, 

Mike Omeife, did not 

respond to a text message. Skye 

bank, whose board was dissolved 

in 2016 by the Central 

bank over weak capital adequacy 

ratios and ballooning bad loans, 

was also not immediately available 

for comment. 

Two phone calls to Cairo-based 

Afrexim bank’s Abuja address at 

No. 2 Gnassingbe Eyadema Street, 

Asokoro, went unreplied as work 

hours had elapsed at the time the 

calls were made. 

Nigerian companies have 

suffered since the 2014 oil-price 

crash triggered an economic 

contraction and sent corporate 

earnings plunging. 

Last year, Etisalat Nigeria 

(now 9mobile) was taken over 

and later put on receivership by 

13 creditor banks who had provided 

the telecommunication 

company a $1.2 billion loan in 

2013, which the company defaulted 

on. 

Rampant inflation reduced 

consumers’ purchasing power 

and the central bank’s tightening 

of capital controls led to a 

shortage of dollars, which companies 

need to pay for imported 

equipment and service foreigncurrency 

loans. 

The naira lost more than 

half its value against the United 

States dollar in that period, with 

companies having to deal with 

dollar loans that had doubled 

in naira terms. That saw nonperforming 

bank loans spiral to 

more than double the limit set 

by the regulator. 

Being an oil exploration and 

production company, Shebah 

was particularly hard hit by 

declining oil prices and militant 

attacks in the Niger-delta that 

nearly halved the country’s production 

to a decade-low of 1.2 

million barrels daily. 

The $150 million loan was to 

enable Shebah refinance some 

of its pre-existing debt; and 

provide it with working capital, 

including funding for an oil 

production programme at the 

Ukpokiti oil field in Nigeria, from 

which Shebah was entitled to 80 

percent of the revenue. 

Stakeholders set... 


listed securities market has driven 

NASD Plc to record growth in value 

and volume of securities traded. 

Ajomale will key into this conference 

to tell the world his efforts 

around enhancing transparency 

on the inherent value in such 

companies, improve levels of investor 

confidence, and other new 

initiatives. 

For Haruna Jalo-Waziri, Managing 

Director/Chief Executive 

Officer, Central Securities Clearing 

System (CSCS) Plc, it will be a 

platform for him to speak more to 

stakeholders on CSCS’s recently 

unveiled three-year strategy which 

is effective from 2018 to 2020. 

Other areas of focus for the 

panelists include: how to attract 

new listings, the role of alternative 

asset classes, effective strategies 

for wealth creation after recession, 

factors changing the global investment 

industry and implications 

for Nigerian markets, increasing 

retail participation in the Nigerian 

capital market, and how to educate 

investors to exploit the gains 

of diversified asset classes.


While I was away (2): Obasanjo’s pious pontification 

Continued from back page 

honey”. What a perfidious 

distortion of history! 

Interestingly, someone 

recently tweeted the front 

page of Daily Trust of August 

10, 2002 with the headline 

“Nigerians are suffering, IBB 

tells Obasanjo”. Does that 

look like a land “flowing with 

milk and honey”? Although 

his government created a 

few billionaires, mainly due 

to crony capitalism, Nigeria’s 

Gini index, the measure of 

inequality, dropped only marginally 

from 0.47 in 1999 when 

Obasanjo became president 

to 0.43 in 2007 when he left 

office. Not a golden age! 

Moreover, whatever 

Obasanjo achieved economically 

and institutionally, 

he destroyed politically. 

He destroyed internal party 

democracy, neutered opposition 

parties, eschewed 

political reforms, conducted 

massively rigged elections 

and – wait for it – tried to 

change the constitution to 

run for a third term! Clearly, 

Obasanjo does not seem to 

know the enormous damage 

that the Third-term agenda 

did to his reputation and to 

Nigeria’s political system. He 

said politics is depressed in 

Nigeria today, but, lest we 

forget, Nigeria was as politically 

depressed when he left 

office in 2007 as it was when 

he became president in1999! 

Recently, in the full glare 

of media publicity, Obasanjo 

laid a wreath at the tomb of 

the 73 people killed by herders 

in the New Year, and said, 

“I feel sad beyond description”, 

adding that “The loss of 

life of one Nigerian is a loss 

to all of us”. Great, except that 

the Odi massacre, during 

which hundreds of innocent 

civilians were killed by soldiers 

and villages were destroyed, 

happened under his 

administration. The federal 

high court later described the 

killings as a “brazen violation 

of the fundamental human 

rights of the victims”. 

Take another example of 

seeming hypocrisy. Obasanjo 

was in Rwanda last month 

Heritage Bank commits to sustainable growth, profitability 

Heritage Bank plc 

has restated its 

commitment to 

sustainable growth 

and profitability despite the 

prevailing adverse macroeconomic 

environment. 

The bank said in statement 

issued at the weekend by Fela 

Ibidapo, divisional head, corporate 

communications, that, 

“Its ambition to emerge as a 

systemic important bank in 

the Nigerian banking industry 

remains its underlying corporate 

growth strategy.” 

According to Ibidapo, the 

foundational element of its 

growth strategy: People, Partnership 

and Process have 

been recalibrated to match 

the rapidly changing needs of 

and took part in the photo 

opportunity during the signing 

of the African Continental 

Free Trade Area (AfCFTA). 

He criticised President Buhari 

for not attending, saying: 

“It is criminal for any 

African leader to talk of not 

understanding what we are 

going to sign and afford not 

to be here”. But the same 

Obasanjo ran one of the most 

protectionist governments 

in Africa, even boasting that 

“We will ban more imports”. 

So, is he now a supporter of 

free trade, which is what the 

AfCFTA is about? Or is he just 

a fair-weather cheerleader for 

free trade? 

And what about values? 

Last year, when Rochas 

Okorocha, the megalomaniacal 

and nepotistic governor of 

Imo state, unveiled a statue in 

honour of Jacob Zuma, then 

president of South Africa, 

Obasanjo was there to support 

Okorocha and Zuma. 

Now, a key test in politics is: 

“Whose side are you on?” So, 

does Obasanjo, the apostle 

of good governance, believe 

that a statue for Zuma was 

the best way to spend the 

resources of Imo State, a 

state where workers are owed 

several months’ salaries? 

Does he even believe that 

Zuma deserved the “honour”, 

a statue anywhere in 

Nigeria? When the BBC asked 

Obasanjo last year whether 

he thought President Paul 

Kagame of Rwanda was a 

democrat, Baba’s answer was 

“yes”, even though Kagame 

silenced all key opposition 

politicians in the country. 

Last month, the British police 

said the Rwandan government 

was sponsoring secret 

agents to kill Rwandan exiles 

in the UK. Yet, Obasanjo said, 

“as far as I am concerned, 

there is nothing undemocratic 

about Kagame”! 

Clearly, on the key leadership 

tests of judgment and 

values, Obasanjo has not justified 

the moral high ground 

he always claims. His recent 

criticisms of Buhari are accurate, 

but they are discredited 

by his own past and values. In 

Britain, a former leader like 

its customers, especially as it 

deploys full steam retail banking 

franchise. 

The bank is on a growth 

track and not unmindful of 

the headwinds facing the 

domestic economy, Ibidapo 

said, adding that it is very 

optimistic that the Heritage 

brand will continue to soar 

over the current economic 

tide through its collective efforts 

to remain an enduring 

institution. 

He said the bank would 

continue to grow by appealing 

to key client segments, 

especially in the retail space 

and also focus on underpenetrated 

banking segments 

while building loyalty among 

the bank’s existing customer 

Obasanjo would hardly be 

shown any deference by the 

media or the public, as the 

BBC demonstrated last year 

in its totally irreverent HARDtalk 

interview with him. But 

Obasanjo takes Nigerians for 

granted, and they acquiesce! 

Which brings me to his 

“Coalition for Nigeria”, which 

he said self-assuredly would 

“drive Nigeria up and forward”. 

He added hyperbolically 

that “failure to do it will 

amount to a sin against God 

and a crime against humanity”. 

Really? So, what’s the 

movement’s raison d’etre? 

Obasanjo listed “democracy”, 

“good governance”, “socioeconomic 

well-being” and 

“progress”! But which political 

organisation in the world 

doesn’t have these universal 

goals? Why would “all wellmeaning 

Nigerians” belong 

to one movement in order 

achieve them? 

What’s more, these generic 

goals can only be achieved 

within a well-functioning 

political economy, in a society 

with the right politicogovernance 

structure. Yet 

Obasanjo is against political 

restructuring. True, Nigeria 

needs a coalition, but it is 

a coalition to restructure 

the country, a coalition to 

give Nigeria a new political 

settlement, not a self-serving 

movement with some nebulous 

political agenda. 

Surely, Obasanjo’s “Coalition 

for Nigeria”, which could 

“field candidates for elections”, 

is his attempt to play 

the Svengali, the godfather, 

again! Indeed, recently, one 

politician, Perry Opara, an 

Obasanjo confidant, said that 

“Obj will be instrumental in 

who becomes president in 

2019”, adding: “Obasanjo is 

the Nigerian political oracle, 

which must be consulted in 

any presidential election”. 

So, we know what’s behind 

Obasanjo’s recent sanctimonious 

interventions. He 

wants, yet again, to choose 

Nigeria’s next president. But 

Nigeria must reject Obasanjo’s 

demagogy, and free itselffrom 

his patrimonial and 

Svengalian grip! 

base. 

The statement said the 

bank was committed to 

building an enduring and resilient 

banking franchise in 

the country, remarking that 

in the midst of the seemingly 

stormy realities presented by 

events within the political and 

economic environments, and 

would continue to pursue its 

strategic aspiration of not only 

being stable but also being 

sustainable in earnings and 

profitability in its growth plan. 

He remarked that the bank 

was committed to deploying 

its resources towards the 

delivery of innovative banking 

solutions to its customers 

as well as create and transfer 

wealth to all its stakeholders. 

L-R: Abiola Olorunnisola, executive vice president (South West), Junior Chambers International 

(JCI) Nigeria; Toyin Atanda, chairperson, 2018 JCI Ten Outstanding Young persons (TOYP) 

awards; Adeniyi Balogun, president, JCI Nigeria, and Lekan Fadina, member of panel of 

judges, JCI TOYP 2018, at the unveiling of Ten Outstanding Young Personality awards in 

Lagos, yesterday. 


Experts see 10% duty on solar panel threatening 

energy access to 95m off-grid Nigerians 


Energy experts are 

worried that the 

recent 10 percent 

duty hike on solar 

panels by the 

Federal Government will adversely 

affect the chances of 

improving coverage for over 

95 million Nigerians who are 

not connected to the grid. 

Their worries are further 

compounded by the fact that 

Nigeria currently does not 

have the capacity to manufacture 

solar panels in volumes 

that can meet market demand, 

hence recourse to importation 

of key equipments 

for the production while also 

growing local capacity. 

The Renewable Energy Association 

of Nigeria (REAN), a 

leading private sector renewable 

energy group in Nigeria, 

had raised the concern that 

their members were being 

forced to pay 5 percent – 10 

percent import duty on solar 

panels by the Nigeria Customs 

Service. 

According to the REAN, 

the tariff hike will increase acquisition 

cost of solar panels, 

Diaspora Nigerians express support for Moghalu presidential campaign 

Nigerians in Diaspora 

have expressed 

support for the 

2019 presidential 

campaign of the former Central 

Bank of Nigeria (CBN) 

deputy governor, Kingsley 

Moghalu. This was declared 

during a town hall meeting 

held last week in Washington 

DC, United States of America. 

Making a case on his candidacy 

at the event, Moghalu 

shared his structured and 

ambitious vision for Nigeria 

- one that is deeply rooted in 

both local and international 

experience, commitment to 

change, and an unrivalled 

passion to serve Nigerians, 

which he said had been articulated 

with the 25 visions 

in his new book: Build, Innovate 

and Grow: My vision for 

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which are currently heavily 

deplored in rural areas where 

purchasing power is low, as 

the hike can derail Nigerian’s 

plan to generate 30 percent 

of electricity through renewables 

by 2030. 

The group confirmed 

through its president, Segun 

Adaju, that under the Common 

External Tariff (CET) 

code 8541.4010.00 - a classification 

for import duty tariff - 

import on solar panels should 

be 0 percent. 

The REAN noted that as a 

result of the hike, discharge 

of goods from the ports had 

been slowed down immensely 

and demurrage charges 

had risen for its members 

since the start of the year. 

Apart from the REAN, 

analysts are worried the 10 

percent import duty on solar 

panels had slowed down discharge 

of solar panel goods 

at the ports, pointing out that 

demurrage charges had risen 

for local industry players. 

Ify Malo, a renewable energy 

expert and campaign 

manager, Power for All in 

Nigeria, said the duty on the 

solar panel could be a clog 

our Country – all providing 

practical and specific policy 

prescriptions on power, 

education, healthcare, innovation 

and the economy to 

massively improve the country. 

As part of the candidate’s 

To Build A Nation Tour, he 

addressed questions on issues 

affecting Nigeria’s economic 

development despite 

its huge natural and human 

potential, and his intention 

to create a nation anchored 

on accountability, citizencentred 

solutions and a practical 

plan to build, innovate 

and grow a country for the 

21st Century devoid of corruption, 

political instability, 

mediocre leaders, insecurity, 

dilapidated health and 

educational institutions and 

mass unemployment. 

BUSINESS DAY 

47 

NEWS 

in the wheel for the Federal 

Government’s plan of generating 

3,000mw through offgrid 

solutions. 

However, Joseph Attah, 

Nigeria Customs Service 

spokesperson, clarified in 

a telephone conversation 

with BusinessDay on Friday 

that the hike was a fiscal 

policy issue of the Federal 

Government and must be 

addressed as such. 

According to Attah, 

the importation of the solar 

panel as categorised as 

‘85-41’ still comes in with 

zero duty, however, when 

the panel comes with other 

components, it attracts duty 

payment because of categorisation 

of payable duty. 

He suggested to the REAN 

group to engage the Federal 

Government appropriately 

on the issue, since it was a 

policy issue. 

It would be recalled that 

the Federal Government had 

informed of its target to have 

10,000 mini-grids by which it 

would generate 3,000mw of 

electricity to energise underserved 

off-grid communities 

across Nigeria by 2020. 

Commenting at the meeting, 

participants delivered 

messages of support and 

expressed excitement about 

the country’s future in prospect 

of a Kingsley Moghalu 

presidency, as several attendees 

noted that they had 

signed off work to be present 

at the event. 

“I am inspired by everything 

I have heard here 

today and I am sure many 

of us here are too. I have followed 

Dr. Kingsley for some 

time on social media, and I 

am glad to hear him share 

his vision and discuss real issues 

in person. I encourage 

everyone here to go out and 

share the word and build this 

movement, and continue 

this conversation,” Ifeyinka 

David, a Nigerian resident in 

Maryland, said.


2018 Top 25 CEOs on the 

NSE Awards holds April 26 

TELIAT SULE 

The Top 25 CEOs 

Awards, for the 

leading 25 chief 

executive officers 

of companies listed on the 

Nigerian Stock Exchange 

(NSE), will hold April 26, 

2018. The venue is the Intercontinental 

Hotels, Victoria 

Island, Lagos. Red 

carpet opens by 6pm. 

This year’s awards will 

recognise the topmost 

CEOs who contributed to 

the stellar performance of 

the NSE in 2017. Dignitaries 

expected at the event 

include the CEO of the 

NSE, Oscar Onyema, the 

executive governor of Ogun 

State, Ibikunle Amosun, 

the CEOs of Nestle, GTB, 

Zenith, Eternal Oil, NAS- 

CON, Fidson, C & I Leasing, 

Flour Mills, Dangote Sugar, 

African Prudential, Access, 

Stanbic Holdings, among 

others. 

For a CEO to qualify for 

the Annual Top 25 CEOs 

Awards, its share price 

must have outperformed 

the All Share Index (ASI) of 

the NSE, coupled with an 

impressive growth in latest 

profit after tax (PAT). 

BusinessDay Research 

and Intelligence Unit 

(BRIU), which usually carries 

out the analysis, and 

BusinessDay Conferences, 

the organiser of the event, 

anchor the Annual Awards. 

In FY2017, listed stocks 

on the Nigerian bourse recorded 

price appreciation 

to the tune of 42.3 percent, 

which amounted to N4.36 

trillion in gains to market 

players. Sectoral indexes 

were also very impressive 

as stocks listed under the 

NSE Banking Index, NSE 

Insurance Index, and NSE 

Premium Index rose by 

73.32 percent, 70.33 percent 

and 51.23 percent, respectively. 

It will interest you to 

know that the Top 25 CEOs 

that made the list in 2017 

added N2.65 trillion to their 

companies’ market capitalisation, 

translating to 61 

percent of the N4.36 trillion 

gained in the entire market. 

The Top 25 CEOs of 

quoted companies on the 

NSE were introduced to 

celebrate the CEOs who 

outperformed the market 

by adding significant 

value to shareholders’ investment. 

Parameters used in the 

selection of the winners 

include share price appreciation 

and a sustainability 

growth in each company’s 

profit after tax (PAT). 

The Award was instituted 

in 2014 to call the 

attention of both the local 

and international investors 

to the opportunities in the 

Nigerian capital market. 

The current governor of 

the Central Bank of Nigeria 

(CBN), Godwin Emefiele, 

was one of the past winners 

when he was the GMD/ 

CEO of Zenith Bank. 

Since its introduction, 

the annual event has become 

the capital market 

bellwether used in identifying 

the performing 

chief executive officers 

and stocks on the NSE. 

It is to this end that we 

celebrate these men and 

women who have contributed 

to the success 

recorded by their companies 

and the Nigerian 

economy in general. 

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ICAN vows to fight mediocrity, proliferation 

of accountancy bodies in Nigeria 

CBN, banks plan to disburse N60bn 

AGSMEIS fund to vulnerable sector 

rate under the Real Sector 

KELECHI EWUZIE 

“I led a delegation to the HOPE MOSES-ASHIKE IFEOMA OKEKE 

National Assembly, particularly 

to the Senate, to Central Bank of Nige- 

strategic initiative is targeted 

Support Facility (RSSF). The 

The Institute of Chartered 

Accountants condemn the bills in strong 

ria (CBN) in collaboration 

with deposit and agriculture, given the 

at projects in manufacturing 

of Nigeria (ICAN) terms. But just last week, 

has vowed to use our liaison person from the 

money banks are mutual interdependence of 

every necessary mechanism 

to deal with the grow- 

us that the same bill was lion from the Agri-business, industrialisation of agro-al- 

National Assembly notified planning to disburse N60 bil- 

both sectors for the complete 

ing rate of mediocrity in the read in the House of Representatives,” 

he said. 

fund (AGSMEIS) to the vul- 

He also disclosed that 

SME Investment Scheme lied business, he said. 

nation’s professional sphere 

and also fight the proliferation 

of accountancy bodies assured members that the my in the next few days. based Risk Sharing System 

The ICAN president, who nerable sector of the econo- 

under the Nigeria Incentive- 

in Nigeria. 

management was working AGSMEIS fund is an initiative 

by the banks as directed (NIRSAL), established in 

for Agricultural Lending 

Ismaila Muhammadu to ensure that mediocre do 

Zakari, president of ICAN, not succeed with their plans, by the CBN to set aside 5 percent 

of their profit after tax valued at over N33.0 bil- 

2011, more than 224 projects 

said the ICAN had been urged members to ensure 

under threat by some mediocre 

that want to set up to kill mediocrity in the ac- 

to have grown to N60 billion Federal Ministry of Agricul- 

that all hands were on deck yearly. The fund is expected lion were guaranteed for the 

accountancy bodies. 

countancy profession. by the end of the year. 

ture’s Growth Enhancement 

Zakari stated this in his “The motive behind setting 

up these proposed innor 

of CBN, disclosed this at Under the Anchor Bor- 

Godwin Emefiele, gover- 

Scheme. 

opening address at the induction 

ceremony of the 99 stitutes was basically for the weekend in Lagos while rowers’ Programme (ABP), 

candidates that qualified money making. From the delivering an address at the he reported that the domestic 

rice production had 

for certification in three faculties 

- Audit, Investigations ICAN, the people behind sonality of the Year 2017” increased many folds and 

investigation carried out by Guardian “Economic Per- 

and Forensic Accounting; these bodies were Nigerians, 

who failed to pass He noted that the level of stantially. 

award. 

its imports had crashed sub- 

Financial Reporting Standards, 

as well as Insolvency ICAN certification examination,” 

he said. 

my channelled to productive ing the bank’s intervention 

credit in the domestic econo- 

While also enumerat- 

and Corporate Re-engineering. 

He further disclosed that private sector was critically efforts in the power sector, 

According to Zakari, the people behind the new below the levels required to which he noted was key to industrialisation, 

as well as the 

ICAN was invited by the National 

Assembly last month rensic Accounting, which is path of balanced, sustain- 

Micro, Small and Medium- 

bodies also argued that Fo- 

place the economy on the 

to make a presentation on an arm of accountancy, was able, and inclusive growths. Scale Enterprises (MSMEs), 

bill seeking to establish Act a different profession. “We Emefiele said N393.5 billion 

had been released to 478 us of sustainable growth, job 

which he said was the nucle- 

for the creation of Chartered 

Institute of Forensic from the Corporate Affairs large-scale agricultural pro- 

creation and poverty reduc- 

already have two searches 

Accountant of Nigeria and Commission (CAC) confirming 

the existence and even as the bank was poised of the CBN in key sectors had 

jects since inception in 2010, tion, he said the intervention 

Chartered Institute of Forensic 

and Investigative Auditors 

in Nigeria. 

of the new bodies,” he said. lion at only 9 percent interest in local 

membership composition to disburse up to N400 bil- 

resulted in a significant boost 

production. 


Unions petition FG over sack of 37 

teachers from aviation school 

Aviation unions in 

the Nigerian aviation 

industry have 

petitioned the 

Federal Government over 

the sack of 37 teachers from 

the Nigerian College of Aviation 

Technology (NCAT), 

Zaria, Kaduna State, by the 

management. 

The unions - National 

Union of Air Transport 

Employees (NUATE), Air 

Transport Services Senior 

Staff Association of Nigeria 

(ATSSSAN) and the National 

Association of Aircraft 

Pilots and Engineers 

(NAAPE) - in a joint petition 

signed by their general 

secretaries insisted that the 

college’s management was 

ill-advised by some people 

in the system. 

The unions also demand 

for due process 

at all times be followed 

when the management 

decides to discharge any 

of their members due to 

faults not of theirs. 

The petition, dated 

March 19, 2018, was 

signed by Frances Akinjole, 

ATSSSAN; Olayinka 

Abioye, NUATE, and 

Ocheme Aba for NAAPE. 

The unions also copied 

Hadi Sirika, minister of state 

for aviation, Rotimi Amaechi, 

minister of transportation, 

Chris Ngige, minister 

of labour and employment, 

head of the civil service of 

the federation and the executive 

chairman, Salaries, 

Income and Wages. 

The petition insisted 

that “some mischievous 

third force at NCAT” were 

bent on misadvising the 

management in order to 

dislocate the prevailing industrial 

harmony at NCAT, 

wondering why the management 

was reluctant in 

implementing the judgement 

of the National Industrial 

Court of Nigeria, which 

reversed the sack of teachers 

in staff schools across 

the country. 

The petitioners explained 

that the management 

of the college immediately 

implemented the 

policy of the government, 

which withdrew it from the 

funding of staff schools, but 

wondered why it was slow 

in implementing a court 

judgement, which reversed 

the government’s policy. 

Other staff schools across 

the country have implemented 

the judgement of the 

industrial court by recalling 

their sacked teachers in staff 

schools, but only NCAT was 

yet to implement such.


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BUSINESS DAY C002D5556 Monday 09 April 2018 

Monday 09 April 2018 C002D5556 

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Access Bank Rateswatch 

KEY MACROECONOMIC INDICATORS 

Indicators Current Figures Comments 

GDP Growth (%) 1.92 Q4 2017 — higher by 0.52% compared to 1.40% in Q3 2017 

Broad Money Supply (M2) (N’ trillion) 24.02 Increased by 0.79% in Feb’ 2018 from N23.83 trillion in Jan 2018 

Credit to Private Sector (N’ trillion) 22.62 Increased by 2.88% in Feb’ 2018 from N21.99 trillion in Jan 2018 

Currency in Circulation (N’ trillion) 1.94 Decreased by 0.42% in Feb’ 2018 from N1.95 trillion in Jan 2018 

Inflation rate (%) (y-o-y) 14.33 Declined to 14.33% in Feb’ 2018 from 15.13% in Jan’2018 

Monetary Policy Rate (%) 14 Raised to 14% in July ’2016 from 12% 

Interest Rate (Asymmetrical Corridor) 14 (+2/-5) Lending rate changed to 16% & Deposit rate 9% 

External Reserves (US$ million) 46.55 April 4, 2018 figure — an increase of 9.20% from March start 

Oil Price (US$/Barrel) 69.04 April 6, 2018 figure - a decrease of 0.1% from a prior week 

Oil Production mbpd (OPEC) 1.81 Feb’ 2018 figure — an increase of 1.40% from Jan’2018 figure 

STOCK MARKET 

Indicators Friday Friday Change(%) 

6/04/18 29/03/18 

NSE ASI 40,841.14 41,504.51 (1.60) 

Market Cap(N’tr) 14.75 14.99 (1.60) 

Volume (bn) 0.50 0.27 84.13 

Value (N’bn) 5.85 3.72 57.35 

MONEY MARKET 

NIBOR 

Tenor Friday Rate Friday Rate Change 

(%) (%) (Basis Point) 

6/04/18 29/03/18 

OBB 3.67 7.17 (350) 

O/N 4.00 8.08 (408) 

CALL 8.94 11.95 (301) 

30 Days 14.90 15.05 (15) 

90 Days 15.68 16.02 (34) 

FOREIGN EXCHANGE MARKET 

Market Friday Friday 

1 Month 

(N/$) (N/$) Rate (N/$) 

6/04/18 29/03/18 

6/03/18 

Official (N) 305.60 305.65 305.80 

Inter-Bank (N) 336.87 336.42 335.18 

BDC (N) 359.81 360.00 360.00 

Parallel (N) 362.00 362.00 362.00 

BOND MARKET 

AVERAGE YIELDS 

Tenor Friday Friday 

Change 


6/04/18 29/03/18 

3-Year 0.00 0.00 0 

5-Year 13.56 13.78 (22) 

7-Year 13.72 13.92 (20) 

10-Year 13.62 13.69 (6) 

20-Year 13.65 13.63 1 

Disclaimer 

This report is based on information obtained from various sources believed to be 

reliable and no representation is made that it is accurate or complete. Reasonable care 

has been taken in preparing this document. Access Bank Plc shall not take responsibility 

or liability for errors or fact or for any opinion expressed herein .This document is for 

information purposes and private circulation only and may not be reproduced, 

distributed or published by any recipient for any purpose without prior express consent 

of Access Bank Plc. 

Sources: CBN, Financial Market Dealers Association of Nigeria, NSE and 

Access Bank Economic Intelligence Group computation. 

COMMODITIES MARKET 

Indicators 6/04/18 1-week YTD 

Change Change 

(%) (%) 

Energy 

Crude Oil $/bbl) 69.04 (0.09) 

7.11 

Natural Gas ($/MMBtu) 2.70 (2.17) (11.65) 

Agriculture 

Cocoa ($/MT) 2,452.00 (5.15) 

26.65 

Coffee ($/lb.) 117.45 (0.25) (9.79) 

Cotton ($/lb.) 82.53 1.96 6.49 

Sugar ($/lb.) 12.39 0.90 (19.18) 

Wheat ($/bu.) 468.00 4.52 7.96 

Metals 

Gold ($/t oz.) 1,332.46 0.69 1.13 

Silver ($/t oz.) 16.38 0.80 (4.71) 

Copper ($/lb.) 305.60 0.66 (6.77) 

NIGERIAN INTERBANK TREASURY BILLS TRUE YIELDS 

Tenor Friday Friday Change 


6/04/18 29/03/18 

1 Mnth 13.90 13.44 45 

3 Mnths 13.20 14.40 (119) 

6 Mnths 14.67 15.12 (46) 

9 Mnths 14.59 14.69 (10) 

12 Mnths 14.90 15.04 (15) 

ACCESS BANK NIGERIAN GOV’T BOND INDEX 

Indicators Friday Friday Change 


6/04/18 29/03/18 

Index 2,623.02 2,615.33 0.29 

Mkt Cap Gross (N'tr) 8.81 8.71 1.17 

Mkt Cap Net (N'tr) 5.75 5.68 1.25 

YTD return (%) 6.78 6.47 0.31 

YTD return (%)(US $) -48.35 -48.68 0.33 

TREASURY BILLS (MATURITIES) 

Tenor Amount Rate (%) Date 

(N' million) 

91 Day 9,520 11.75 4-Apr-2018 



Market Analysis and Outlook: April 06 - April 13, 2018 

Global Economy 

In the U.S., the unemployment rate stood at 4.1% 

in March 2018, same as in the previous month. 

The number of unemployed persons dropped by 

121,000 to 6.59 million and employment fell by 

37,000 to 155.18 million. Data according to the 

Bureau of Labour Statistics (BLS) revealed that 

the labour force participation rate stood at 62.9% 

in March and the employment-population ratio 

stood at 60.4%. Elsewhere in Brazil, the trade 

surplus declined to $6.28 billion in March 2018 

from $7.14 billion in March 2017. Imports climbed 

16.9%, driven by purchases of intermediate 

goods, fuels and lubricants. According to the 

Ministry of Development, Industry and Foreign 

Trade (MDIC), exports also surged by 9.6% driven 

by sales of basic goods and manufactured 

products. Among major export trading partners, 

shipments increased to the European Union (EU), 

China and the U.S. Considering the first quarter of 

2018, imports jumped 15.8% to $36.05 billion and 

exports rose by 11.3% to $54.37 billion, therefore 

shrinking the trade surplus by 3.1% to $13.95 

billion in the reference quarter. In another 

development, the Reserve Bank of India left its 

key policy rate unchanged at 6% during its April 

meeting. Policymakers stated that the decision is 

in line with the Bank’s neutral monetary policy 

stance which aims to achieve the medium term 

inflation target of 4%. The inflation forecast was 

lowered to 4.5% from 5.1% for Q1 2018 of the 

current fiscal year. GDP growth for 2018 was also 

revised to 7.4% from 6.6% previously. 

Local Economy 

The Nigerian Stock Exchange (NSE) published its 

m o n t h l y D o m e s t i c & F o r e i g n P o r t f o l i o 

investment report for the month of February 

2018. The report revealed that the total 

transactions at the nation’s bourse declined in 

the month of February 2018 by 46.24% to 

N212.05 billion from N394.44 billion recorded in 

January 2018. Total foreign transactions 

witnessed a significant decline when compared 

to the previous month by 49.98% to N83.22 

billion from N166.39 billion the prior month. Total 

domestic transactions followed closely falling by 

43.51% to N128.83 billion from N228.05 billion in 

January. A decrease of 51.07% in monthly foreign 

inflows was recorded at N44.89 billion from 

N91.75 billion in January. Foreign outflows fell by 

48.65% to N38.33 billion in February from N74.64 

billion in the previous month. In a separate 

development, according to the Central Bank of 

Nigeria’s Credit Conditions Survey report for Q1 

2018, the availability of secured credit to 

households increased during the first quarter of 

the year due to a favourable economic outlook for 

the economy. The demand for secured lending by 

households however, declined during the quarter 

under review. The proportion of loan applications 

that were approved increased despite lenders’ 

tightening of the credit scoring criteria. It was 

also reported that the availability of unsecured 

credit to households increased during the 

reference quarter as well as the demand for 

unsecured lending from households. The 

availability of credit to the corporate sector 

increased as well as the demand for corporate 

credit across all firm sizes during the quarter. 

R e g a r d i n g l o a n d e f a u l t s , s e c u r e d l o a n 

p e r f o r m a n c e a n d t o t a l u n s e c u r e d l o a n 

performance to households worsened in Q1 

2018. Corporate loan performance improved 

across all firm sizes except for small businesses. 

Regarding loan pricing, lenders reported that the 

overall spreads on secured lending rates on 

approved new loans to households relative to 

MPR narrowed in Q1 2018. The spreads on overall 

unsecured lending also narrowed in the reference 

quarter. 

Stock Market 

The local bourse closed in the red in the week 

ended April 6, 2018. The negative performance 

was due to profit taking especially on gains of the 

previous week. The All Share Index (ASI) posted 

losses of 1.6% or 663.37 points to close at 

40,841.14 points from 41,504.51 points the 

previous week. Similarly, market capitalization 

also fell by 1.6% to close at N14.75 trillion from 

N14.99 trillion the previous week. Market indices 

was pulled down by stocks in the industrial goods 

and oil & gas sectors. This week market sentiment 

may improve as investors await more earnings 

report. 

Money Market 

Money market rates moderated in the week 

ended April 06, 2018 due to inflow from Federal 

Accounts Allocation Committee (FAAC) of about 

N312 billion. Short-dated placements such as 

Open Buy Back (OBB) and Over Night (O/N) rates 

declined to 3.67% and 4% from 7.17% and 8.08% 

respectively the previous week. Longer dated 

placements also trended downwards. The 30-day 

and 90-day NIBOR closed lower at 14.90% and 

15.68% from 15.05% and 16.02% the prior week. 

This week, rates may trend higher due to 

expected retail Secondary Market Intervention 

Sales (SMIS). 

Foreign Exchange Market 

The local currency depreciated marginally at the 

interbank window by 45kobo to close at 

N336.87/$ from N336.42/$ the previous week. 

The local currency however appreciated slightly 

at the official market to N305.60/$ from 

N305.65/$ the previous week. At the parallel 

market, the local currency remained unchanged 

from the previous week at N362/$. The 

depreciation witnessed at the interbank segment 

may be attributed to the apex bank’s mop up of 

naira liquidity to curb speculation on the currency. 

This week, we expect the naira will remain around 

prevailing levels. 

Bond Market 

Bond yields trended downwards last week due to 

increase in demand from improved liquidity. 

Yields on the five-, seven- and ten-year debt 

papers settled at 13.56%, 13.72%, and 13.62% 

from 13.78%, 13.92%, and 13.69% respectively 

the previous week. The Access Bank Bond index 

rose by 7.69 points or 0.29% to close at 2,623.02 

points from 2,615.33 points the previous week. 

This week, yields might trend upwards due to 

anticipated tight liquidity. 

Commodities Market 

Oil prices declined last week after the U.S. 

president, Donald Trump threatened new tariffs 

on China, reigniting fears of a trade war between 

the world’s two largest economies. The 

Organization of Petroleum Exporting Countries 

(OPEC) reference crude fell by 1.32% to $65.18 

per barrel from $66.05 per barrel the previous 

week. Nigeria’s benchmark crude, Bonny light, 

also declined by 0.1% to $69.04 per barrel from 

$69.10 per barrel the previous week. The prices of 

precious metals surged as investors sought safe 

assets after the U.S. president proposed $100 

billion in new tariffs on China. Gold price gained 

0.7% to $1,332.46 an ounce from $1,323.27 an 

ounce the previous week. Silver also rose by 0.8% 

to $16.38 from $16.25 an ounce the previous 

week. Oil prices are likely to remain pressured due 

to the concerns over the potential trade war. 

Precious metals may also be supported by the 

concerns over the potential trade war as 

investors migrate towards safe haven assets. 

MONTHLY MACRO ECONOMIC FORECASTS 

Variables Apr’18 May’18 June’18 

Exchange Rate 

(Official) (N/$) 336.02 337.50 337.90 

Inflation Rate (%) 13.96 13.74 13.00 

Crude Oil Price 

(US$/Barrel) 67 68 68 

For enquiries, contact: Rotimi Peters (Team Lead, Economic Intelligence) (01) 2712123 rotimi.peters@accessbankplc.com


FT FINANCIAL TIMES 

C002D5556 

BUSINESS DAY 

A11 

World Business Newspaper 

Xi Jinping to outline 

economic reforms 

amid trade tension 

Chinese president’s test is to appear as a bold reformer without bending to the US 

TOM MITCHELL AND EMILY FENG 

Xi Jinping will on Tuesday 

give the most anticipated 

speech of his already historic 

presidency. During an address to a 

Chinese government-hosted forum 

on Hainan island, Mr Xi’s challenge 

will be to outline bold new economic 

reforms and measures to open markets 

without appearing to bend to US 

pressure on trade. 

With China preparing to mark the 

40th anniversary of Deng Xiaoping’s 

“reform and opening” policies, Mr Xi 

had hoped to use his address at the 

Bo’ao Forum for Asia to signal his 

determination to be as decisive and 

effective as Deng was in implementing 

difficult economic and financial 

reforms. 

“How will China further advance 

reforms? This is a question people 

want to know the answer to,” Chinese 

foreign minister Wang Yi said 

last week, just hours before trade 

tension between the world’s two 

largest economies erupted. “At Boao, 

Xi Jinping will provide the most 

authoritative answers. Participants 

will see the new opening and reform 

measures that China will take.” 

Last week’s trade hostilities, 

however, have bolstered the position 

of hardliners who argue against 

making any trade or market-opening 

concessions to the US. “It’s very delicate,” 

said one Chinese government 

policy adviser. “We don’t want to 

escalate the situation, but if we don’t 

respond we only encourage Trump.” 

On Sunday US President Donald 

Trump tweeted that “China will take 

down its Trade Barriers because it is 

the right thing to do …A deal will be 

made on [trade].” 

Mr Xi has also limited his room 

for manoeuvre by cultivating an image 

of a nationalist hero in the mould 

of Mao Zedong, Communist China’s 

revolutionary founder. He began his 

first term as party general secretary 

by leading the seven-member Politburo 

Standing Committee on a tour 

of a “Road to Rejuvenation” exhibit 

at China’s national museum, which 

chronicles the “century of humiliation” 

the country endured at the 

hands of foreign invaders between 

1839 and 1945. 

Adidas looks to score online as 

it drives harder into digital 

German sportswear brand ramps up investment as it looks to click with consumers 

OLAF STORBECK 

In two major speeches over the 

past six months, Mr Xi has outlined 

his vision for China’s emergence as 

a first-rank global power. In the most 

recent of these addresses — at last 

month’s annual session of China’s 

rubber-stamp parliament — Mr 

Xi warned the US not to “threaten 

others”. 

It was a warning that Mr Trump 

chose to ignore in what Chinese officials 

saw as deliberately insulting 

fashion. 

On April 5 Mr Trump threatened 

“$100bn in additional tariffs” on 

Chinese exports to the US. Just a 

day earlier the Trump administration 

had outlined its plans to assess 

punitive tariffs on $50bn worth 

of Chinese exports, to which Beijing 

responded in kind. Mr Trump 

dismissed China’s counter-tariffs, 

which officials in Beijing described 

as proportionate and legal, as “unfair 

retaliation” that will “harm our farmers 

and manufacturers”. 

Mr Trump’s latest threat, issued 

via a formal White House statement 

rather than a casual tweet, has raised 

the stakes dramatically for Mr Xi as 

he prepares to address hundreds 

of Chinese and international dignitaries, 

financiers and captains of 

industry at Bo’ao. “Xi is up against 

a wily adversary,” says Tim Clissold, 

a foreign investment adviser and 

veteran of hundreds of Chinese 

business negotiations. “Trump is unpredictable 

and [has] hidden goals.” 

In private, Chinese officials are 

more sanguine. “Trump is unpredictable 

in one sense but he’s very 

predictable in another sense,” one 

official told the Financial Times. 

“He has been a protectionist his 

whole life.” 

In a hastily arranged press conference 

held just before US markets 

opened on Friday morning, a Chinese 

commerce ministry spokesman 

vowed that “under this backdrop [of 

US threats] China will not negotiate”. 

“Trump has moved further in the 

wrong direction,” said He Weiwen, 

a Chinese trade policy expert and 

former commerce ministry official. 

“The right approach is to sit down 

for negotiations without unilateral 

threats, based on hard facts and 

World Trade Organization rules.” 

German sportswear maker 

Adidas is closing stores and 

stepping up investment in 

digital as it looks to more than double 

ecommerce sales over the next two 

years. 

“Our website is the most important 

store we have in the world,” says 

Kasper Rorsted, chief executive. “It 

has priority when we hire, when we 

allocate our resources and when we 

build our infrastructure.” 

Since joining Adidas from German 

consumer goods and chemicals 

group Henkel in 2016, Mr Rorsted 

has ramped up the Herzogenaurachbased 

group’s annual capital expenditure 

by almost 40 per cent. He plans 

to spend €900m this year, with the 

bulk of the increase earmarked for 

digital operations. 

One area of investment is logistics 

and infrastructure, such as fulfilment 

warehouses for online consumers. 

“The entire logistics is totally different,” 

says Mr Rorsted. “When you ship 

to a big retail chain, you ship pallets 

Continues on page A2 

One-man show: Xi Jinping is expected to outline bold economic reforms for China this week © AP 

Barclays plans to split euro trading hub over Brexit 

Shift highlights level of uncertainty in London’s position as dominant centre 

MARTIN ARNOLD AND 

DAN MCCRUM 

Barclays is preparing to split 

its euro rates trading team 

because of Brexit and plans to 

move part of the unit that trades eurozone 

government bonds and interest 

rate swaps away from its main trading 

floor in London. 

The shift is designed to allow 

Barclays to continue trading euro 

securities with European clients 

even if the UK crashes out of the EU 

in March 2019 with no trade deal or 

transition agreement to maintain 

access to the bloc’s single market. 

The plan highlights the level of 

uncertainty over the City of London’s 

position as the dominant 

centre for trading euro securities. 

The European Commission and 

European Central Bank are pushing 

for the EU to retain direct oversight 

over clearing such assets. 

Without a free trade deal between 

the UK and EU to preserve 

mutual market access for financial 

services, banks will lose their “passport” 

that gives them the right to 

trade securities across Europe from 

London. 

US truck driver shortage points to bigger problems 

As automation is happening unevenly a flexible training system is needed 

GILLIAN TETT 

Until recently, if you said the 

word “truck drivers” and 

“21st-century economy” in the 

same breath, most economists — and 

voters — would have guessed that 

the next words would be “job losses”. 

No wonder. A couple of years 

ago, auto experts started to warn 

that computers will soon be driving 

not just cars, but trucks, too. A 

2017 trucking industry report, for 

example, predicts that by 2030 some 

4.4m of the 6.4m trucker jobs in Europe 

and America could disappear, 

since robots will be driving. 

Unsurprisingly, that has sparked 

plenty of hand-wringing about the 

political economy, especially in 

America. After all, in recent decades 

truck driving has been one of the 

best-paying jobs for non-college 

American graduates, and the workforce 

is overwhelmingly male, middleaged 

and lowly-educated. 

Both sides have committed to a 

transition deal to avoid a “cliff edge” 

Brexit by maintaining the status 

quo until December 2020, but that 

agreement is unlikely to be finalised 

until close to the date when the UK 

leaves the EU in March 2019. 

Barclays has not decided where 

its new euro rates trading desk 

will be based but it is expected to 

involve slightly fewer than 10 traders 

being based in the eurozone, 

according to a person briefed on the 

plan. London will, however, remain 

the bank’s main hub for euro rates 

trading and the leader of that team 

will still be based in the UK capital. 

“Meeting the needs of our clients 

worldwide is our top priority,” 

the bank said in an emailed statement. 

“Barclays continues to plan 

for all contingencies relating to 

Brexit to ensure seamless service 

for our clients.” 

The British bank is planning 

to make Dublin its main EU hub 

outside London, adding 150 to 200 

more staff in a new office building 

in the Irish capital. It is also beefing 

up its legal status to become a 

standalone subsidiary with its own 

capital and regulatory oversight. 

So the idea that truckers might 

suddenly be tossed out of the workforce 

has contributed to a fear that we 

are heading for a dystopian future — 

which, of course, is the type of alarming 

theme that Donald Trump played 

on in his presidential campaign. 

But lately, something peculiar 

— and unexpected — has been 

going on with those trucks. Yes, in 

the long term, it is likely we will see 

automated vehicles on the roads. 

However, in the short term the really 

big problem is not a lack of trucker 

jobs, but a dire shortage of all-toohuman 

truckers. The combination 

of a surging economy and a rise in 

internet shopping is creating rising 

demand for long-haul shipping, 

which trucking companies are struggling 

to meet. 

Demand is so high that capacity 

utilisation is now running at about 

100 per cent according to consultants 

(compared with 85 per cent 

at the start of the decade). And the 

Jes Staley, chief executive of 

Barclays, plans to visit Dublin this 

week to discuss its Brexit plans and 

to view its new Molesworth Street 

office in the heart of the city, with 

capacity for up to 400 people. 

The bank’s new euro rates trading 

desk is likely to be based in one 

of its other European offices, such 

as Frankfurt or Paris. These will 

soon be converted from branches of 

its London headquarters to become 

offshoots of its new Irish subsidiary. 

Mr Staley has consistently said 

the impact of Brexit on the bank is 

minor compared with the work it 

has done to comply with UK ringfencing 

rules and US intermediate 

holding company requirements. 

It nonetheless remains one of 

the big challenges still facing him 

and the bank’s chairman, John 

McFarlane, before his planned 

retirement at its annual meeting in 

May 2019. 

Other hurdles include a regulatory 

investigation into Mr Staley’s 

attempt to unmask a whistleblower 

and UK criminal charges against 

the bank and several former executives 

over a rescue fundraising with 

Qatar in 2008. 

producer price index for trucking is 6 

per cent higher than a year ago. That 

has hit margins for companies ranging 

from General Mills to Clorox, and 

executives say the problem could soon 

get even worse. 

What should investors make of 

this? There are at least three important 

lessons. First, this tale shows that we 

should take futurist predictions about 

technology and jobs with a pinch of 

salt. A few years ago researchers at 

Oxford university sparked alarm by 

predicting that 47 per cent of American 

jobs were at risk from “computerisation” 

in the next decade or two. 

However, this week the OECD, 

the Paris-based club of mostly rich 

nations, did its own intensive study 

which estimated that “only” 14 per 

cent of jobs in the west are vulnerable 

to automation. That still might sound 

quite scary. But what is also becoming 

clear is that the spread of robots 

is likely to be uneven, and the timing 

uncertain.

A12 BUSINESS DAY 

C002D5556 Monday 09 April 2018 

FT 

NATIONAL 

Citic Resources plans stake sale to Kazakhstan 

Central Asian country prepares to play bigger role in China’s ‘Belt and Road’ trade 

HENNY SENDER 

Hong Kong listed Citic Resources 

Holdings is negotiating 

with Kazakhstan to sell 

a significant minority stake to the 

country, which is preparing to play 

a bigger role in Beijing’s “Belt and 

Road” trade and development initiative, 

according to two people with 

direct knowledge of the matter. 

The complicated plan, which still 

has not been finalised, involves Citic 

Resources itself selling off a series of 

assets starting with an under-performing 

oilfield in northeastern China. It 

hopes eventually to sell other oilfields 

in China and various mining and coal 

assets, these people added. 

Meanwhile a Kazakh government 

entity will inject energy assets 

into Citic Resources in return for a 

stake in the company, while powerful 

Citic Group itself will remain its largest 

shareholder. 

Among the most important assets 

involved will probably be JSC Karazhanbasmunai, 

which has the right to 

explore, develop, produce and sell oil 

from the Karazhanbas oilfield. Today 

Kazakhstan and Citic Resources each 

own 50 per cent of that entity. 

The deal has been in the works for 

many months and has the blessing of 

Chang Zhenming, chairman of Citic 

Group who is expected to retire next 

year and wants Citic Resources to 

become an important participant in 

China’s principal international initiative, 

these people added. 

Citic Group has long had a close 

relationship with Kazakhstan: for example, 

local Halyk Bank agreed to sell a 

60 per cent stake in its subsidiary Altyn 

Bank to Citic Bank Corp in a transaction 

meant to promote the Belt and Road 

initiative, while Citic Kazyna Investment 

Fund I is sponsored by Citic and is 

a subsidiary of Kazakhstan’s sovereign 

wealth fund. That fund focuses on 

infrastructure projects in Kazakhstan, 

Central Asia and China. 

The first step in the transformation 

of the company is the sale of the 

Hainan-Yuedong Block in the Bohai 

Bay Basin in Liaoning Province to 

Geo-Jade Petroleum Corp, a Shanghailisted 

independent oil exploration and 

production company for a price that is 

yet to be determined. 

Adidas looks to score online 

as it drives harder... 

Continued from page A11 

of shoes; but when you sell to the 

end customer, you ship maybe one 

pair of shoes, some socks and maybe 

some shorts.” 

The group is hiring 200 staff with a 

digital focus and wants to more than 

double its ecommerce revenues to 

€4bn by 2020. Last year, the group’s 

online sales rose 57 per cent to almost 

€1.6bn. 

“That growth rate is impressive,” 

says Piral Dadhania, an analyst with 

Royal Bank of Canada, adding that 

the “relatively ambitious” 2020 target 

for online sales shows Adidas has 

“a high level of confidence for the 

midterm prospects” online. 

As part of its efforts to boost digital 

sales, Adidas introduced a smartphone 

app that allows customers 

a high degree of personalisation. It 

has been launched in the US, the UK 

and Germany, and is set to go live 

in France, Spain and Canada in the 

coming months. 

Another driver of growth are tieups 

with online retailers such as fellow 

German group Zalando — both 

warehouses are connected, and Adidas 

fulfils some of its partner’s orders. 

Adidas, which last month announced 

a €3bn share buyback and 

a 30 per cent increase to its dividend, 

is one of Germany’s best-performing 

blue-chips. Its shares have risen 21 

per cent this year, compared with 

a 5 per cent drop for the blue-chip 

Dax index. 

In the first full year under Mr 

Rorsted’s leadership, Adidas in 

2017 reported a 16 per cent increase 

in revenue to €21.2bn, while the 

operating profit margin increased 

120 basis points to 9.8 per cent. Mr 

Rorsted aims to lift sales 10-12 per 

cent a year by 2020, and to boost 

the operating profit margin from 

almost 10 per cent to 11.5 per cent. 

The company says net profit is forecast 

to rise 22-24 per cent annually 

until 2020. 

“Adidas has been one of the most 

successful turnround stories in the 

sporting goods universe,” write 

Berenberg analysts. 

Mr Rorsted insists increasing 

sales and margins at the same time 

is not a trade-off. “In most industries, 

the larger companies are also 

the most profitable,” he says, adding 

that in the past regional operations 

were too fractured. “Every country 

was running their own warehouses 

and systems. We became 20 Adidas 

companies instead of one.” 

Pruning its store network is also 

intended to increase profitability, as 

margins in ecommerce are higher 

than for traditional retail. 

Christian Sewing has been at Deutsche Bank since 1989 © Reuters 

Co-deputy chief in line to replace Cryan at Deutsche Bank 

Chairman favours Christian Sewing as board prepares to meet on Sunday evening 

OLAF STORBECK 

John Cryan is set to be replaced 

by one of his deputies as chief 

executive of Deutsche Bank two 

years earlier than planned after a spat 

with chairman Paul Achleitner that 

has thrown Germany’s largest lender 

into turmoil, according to two people 

involved in the discussions. 

Deutsche Bank’s supervisory board 

will make a final decision on whether 

to appoint Christian Sewing, who also 

runs the bank’s retail operations and is 

Mr Achleitner’s preferred candidate, 

in a meeting on Sunday evening, according 

to several people familiar with 

the matter. 

The board is also poised to appoint 

Garth Ritchie as the sole head of the 

lender’s ailing corporate and investment 

bank, a person familiar with the 

internal discussions said. 

Mr Ritchie’s current co-head Marcus 

Schenck informed Mr Achleitner 

over the Easter break that he was leaving 

Deutsche Bank after May’s annual 

meeting as the bank was not commit- 

HENRY FOY AND 

DAVID SHEPPARD 

The latest round of US sanctions 

against Russian oligarchs and 

political officials have been designed 

to wound parts of the country’s 

economy. But the pain is also likely to 

be felt far away from Moscow. 

Blanket sanctions against billionaire 

Oleg Deripaska’s aluminium empire look 

set to have an impact across the global 

commodity market, while restrictions on 

major figures in Russia’s energy and industrial 

sectors could also create widespread 

complications for western partners. 

Friday’s salvo against 24 Russians 

ting enough resources to secure the 

investment bank’s global position, 

according to a person who knows Mr 

Schenck. 

Mr Sewing, 47, has been with 

Deutsche Bank since he was a teenager. 

His previous roles included 

head of group audit, deputy chief 

risk officer and chief credit officer. 

German news magazine Der 

Spiegel on Sunday reported that Mr 

Achleitner had chosen Mr Sewing. 

Two people close to the supervisory 

board stressed that the final decision 

had yet to be made. 

Three top-10 shareholders on Sunday 

voiced their deep frustration with 

Mr Achleitner’s handling of the situation. 

“His days as chairman should 

be numbered,” one of the lender’s 

biggest investors told the FT, adding 

that he was “just the lesser of 

two evils”. 

A person at another leading investor 

in Deutsche Bank said it was 

“beyond doubt that Mr Achleitner 

botched his job”. A third key shareholder 

said his record at the lender 

was “devastating” but pointed 

US sanctions on oligarchs set to resonate globally 

Broad-based salvo of restrictions will ripple across wider commodity secto 

and 14 companies bans US citizens from 

doing business with them. 

But it also for the first time extends 

that restriction to non-Americans who 

“knowingly facilitate significant transactions… 

for or on behalf of [them]”, a proviso 

that means the sanctions’ impact on 

global trade will likely be deeper than 

previous curbs. It could make banks and 

commodity houses wary of conducting 

any US dollar denominated transactions 

with those linked to sanctioned entities, 

lawyers said, creating ripples across the 

wider commodity industry in which 

Russia plays an oversized role 

“These sanctions are going to make 

it very difficult for any western bank 

out that his position nonetheless 

seemed secure. Shareholders extended 

Mr Achleitner’s term by five 

years at last year’s annual shareholder 

meeting. 

Mr Achleitner’s frustration over 

Mr Cryan’s lack of leadership, and 

the incomplete implementation of 

the bank’s cost-cutting strategy, are 

the main reason for the rift between 

the chairman and CEO, two people 

familiar with Mr Achleitner’s thinking 

told the FT. 

“This is not about strategy, but 

about the failure to execute it,” one 

of them said. 

Investors have a different view. 

“The strategy and its implementation 

is ultimately the chairman’s 

responsibility,” said Hans-Christoph 

Hirt, executive director at Hermes 

EOS, which advises and represents 

around 0.5 per cent of the voting rights. 

He added that Mr Sewing would be 

the third CEO during the six years of 

Mr Achleitner’s tenure. “Mr Achleitner 

will have to answer some serious 

questions in the run-up to and at the 

shareholder meeting.” 

to deal with these companies or individuals,” 

said Michael O’Kane, partner at 

Peters & Peters in London. “The breadth 

of the sanctions also suggest they may 

restrict non-US citizens from facilitating 

significant transactions with these companies, 

which may complicate trade.” 

It will certainly complicate the aluminium 

market. Mr Deripaska’s Rusal 

accounts for just under 6 per cent of the 

metal’s global supply and is the largest 

producer of the metal outside of China. 

Rusal is the second biggest supplier of 

aluminium to the US after Canada, and 

more than 10 per cent of his output is 

sent to America, roughly $1bn worth of 

metal that it now needs to sell elsewhere. 

Trump leads condemnation 

of Syria gas attack 

US president says there will be ‘big price to 

pay’ for alleged eastern Ghouta attack 

REBECCA COLLARD AND 

COURTNEY WEAVER 

Donald Trump has led international 

condemnation of 

an alleged chemical weapons 

attack by the Syrian government, 

raising prospects of an American 

response to the assault that 

has killed at least 48 people in the 

rebel-held town of Douma. 

The US president singled out 

Russian president Vladimir Putin in 

a tweet on Sunday, saying he held 

Russia and Iran, Syrian president 

Bashar al-Assad’s backers, responsible 

for the atrocity. He slammed 

the “Animal Assad” and warned 

there would be a “big price to pay” 

for the attack. 

Republican lawmakers urged 

Mr Trump to turn his words into 

action. Senator Lindsey Graham, 

a Republican foreign policy hawk, 

said a soft response from Mr Trump 

would damage his credibility. “If 

he doesn’t follow through and live 

up to that tweet, he’s going to look 

weak in the eyes of Russia and Iran,” 

he warned. 

Relations between Washington 

and Moscow are fraught after the 

Trump administration on Friday 

imposed sanctions against 24 

prominent Russians and more than 

a dozen Russian companies. 

The EU said on Sunday that it 

“condemns in the strongest terms 

the use of chemical weapons” 

and urged for an “immediate response 

by the international community 

. . . to make sure that those 

responsible are held accountable.” 

Brussels also pressed Russia 

and Iran “to use their influence to 

prevent any further attack and ensure 

the cessation of hostilities and 

de-escalation of violence”. 

The Syrian American Medical 

Society, a medical relief organisation, 

said that at least 48 people 

had been killed and hundreds more 

injured in a chemical attack inside 

the rebel-held enclave of eastern 

Ghouta on Saturday evening. 

If confirmed the attack would 

be the most serious since sarin gas 

was dropped on the Syrian town of 

Khan Sheikhoun a year ago, killing 

more than 80 people and provoking 

retaliatory air strikes on the Assad 

regime by the US military. The UN 

said last year that the Syrian government 

had carried out dozens of 

chemical attacks since the start of 

the Syrian civil war seven years ago. 

Video footage and images posted 

by activists showed rescue workers 

treating dozens of people, some 

foaming at the mouth, as well as 

children and babies being given 

oxygen and being doused in water. 

It was not possible to confirm the 

authenticity of the videos or images.


Half Africans with HIV have access 

to antiretroviral drugs - WHO 

LAIDE AKINBOADE-ORIERE 

The World Health 

Organisation 

(WHO), on Friday, 

revealed that out of 

28 million Africans 

infected with human immunodeficiency 

virus (HIV), 14 

million have access to lifesaving 

HIV treatment. 

Matshidiso Moeti, WHO 

regional director for Africa, 

stated this during a media 

parley organised to mark its 

70th anniversary as well as 

the World Health Day, saying 

it was imperative for African 

leaders to live up to the Sustainable 

Development Goals 

(SDGs) pledges they made in 

2015 through commitment 

and concrete actions. 

The theme of this year’s 

World Health Day celebration 

is “Universal Health Coverage: 

everyone, everywhere.” 

He stressed that effective 

leadership and high-level of 

political commitment were 

critical to achieving the 

Universal Health Coverage 

(UHC) in Africa. 

In his speech, Moeti said, 

“The WHO has in its 70 years 

of existence recorded major 

advancement in health and 

health technology as well as 

improved access to treatment 

and essential services.” 

According to Moeti, for 

the first time in the history of 

Africa, more than half of all 

people living with HIV in Africa 

(14m) have access to lifesaving 

HIV treatment. 

‘’Over the past 70 years, 

there have been major advances 

in health and health 

technology, including lifesaving 

medicines for diseases 

such as HIV/AIDS, tuberculosis, 

malaria, hypertension 

and diabetes. In the African 

Region, health outcomes 

have been improved through 

strategies such as distributing 

insecticide-treated nets 

to prevent malaria, and vaccinating 

against the human 

papillomavirus, which causes 

cervical cancer,” he said. 

The WHO regional director, 

who also said new cases 

of malaria dropped by 20 percent 

between 2010 and 2016, 

added that the risk of developing 

pneumonia and meningitis 

was largely reduced for 

nearly two thirds of children 

on the continent following 

their vaccination as compared 

to the 3 percent in 2010. 

He reiterated WHO’s 

continued support to 

member states towards 

achieving its Universal 

Health Coverage (UHC), 

the WHO boss, added that 

it had developed a framework 

of actions to assist 

countries in selecting their 

own path towards achieving 

both UHC and SDGs. 

Four more states sign into Lagos rice revolution 

… to jointly cultivate 32,000 hectares of paddy 

JOSHUA BASSEY 

Four states in the 

southwest have 

signed on to the 

planned Lagos rice 

revolution that will see to 

the production of 32 tons of 

rice per hour from the Imota 

Rice Mill, in Ikorodu, which 

is presently undergoing expansion 

and retooling by the 

Lagos State government. 

This brings to six the 

number of states that have 

signed agreement to collaborate 

with Lagos in the 

areas of agro value chain 

and other economic ventures, 

Kebbi and Kano had 

already done so. 

The four states include 

Oyo, Osun, Ondo and Ekiti. 

However, Lagos’ next-door 

neighbour, Ogun, is yet to 

sign into the rice production 

deal. Lagos, Nigeria’s economic 

hub, has advantage 

of market with a population 

estimate of 21 million people. 

It is learnt that Ogun is 

currently resolving areas of 

disagreement with Lagos, 

bordering on a large expanse 

of land that Lagos acquired 

from it (Ogun) during the 

administration of Babatunde 

Fashola, the immediate past 

governor of Lagos, which is 

yet to effectively utilise for 

purposes acquired. It is expected 

that Ogun will join 

the rest of the states upon the 

As Nigeria’s longest 

rigid pavement 

road project 

inches closer to 

completion, motorists travelling 

from Northern part to 

the South say the road has 

started supporting vehicular 

movements across the 

regions. 

The Obajana-Kabba road 

in Kogi State is said to be the 

longest concrete road project 

in Nigeria, one of the 

country’s roads that links the 

North to the South. 

A businessman from the 

North, Ibrahim Dantsoho, 

as well as other motorists 

commended the president 

of the Dangote Group, Aliko 

Dangote, and described the 

project as a big relief, saying 

it had already eased travelling 

and connectivity across 

the regions. 

Managing director of AG- 

Dangote Construction Company, 

Ashif Juma, said the 

project would be completed 

as planned and that Nigerians 

would yearn for more 

of such roads when they see 

the difference with bituminous 

road, 

So far, 33km earthwork 

and 22km concrete pavement 

have been accomplished, 

Juma said, adding 

that every care is being taken 

to ensure that Nigeria has a 

most durable road in Nigeresolution 

of the differences. 

The deal, which is being 

pushed through the southwest 

regional integration, 

aims at upping food production 

and making the region 

self-sufficient in rice. It will 

involve the cultivation of over 

32,000 hectares of paddy with 

Lagos as the milling hub. 

The rice paddy expected 

from this massive cultivation 

will complement the 

earlier agreement signed 

between Lagos and Kebbi 

states, which had resulted in 

the production of Lake Rice 

brand already in the Lagos 

market. 

Aside jobs to be created, 

the joint rice production will 

also serve as income generator 

for rice farmers within the 

southwest states. 

Governor Akinwumi Ambode 

had during the recent 

meeting of the southwest 

governors in Lagos explained 

the role of Lagos in the deal. 

“We are building a 32-ton 

per hour rice mill in Imota, 

and we are going to require 

32,000 hectares of paddy 

cultivation, which even the 

whole of the south west 

cannot even provide. But 

because we are interested 

in integration and also independence, 

it is important 

that beyond going to Kebbi 

or Kano, all the southwest 

states should also benefit 

from it,” Ambode said. 

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Dangote hailed over longest concrete road 

project in Nigeria 

BUSINESS DAY 

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NEWS 

ria. 

He assured: “We will deliver 

the project by December 

this year. All hands are 

on deck,” and urged Nigerian 

governments at all levels 

to switch over to construction 

of concrete road instead 

of asphalt, as it is far superior, 

durable and cheaper, and 

does not require frequent 

maintenance. 

A human right activist 

and consultant, Abdullahi A. 

Umar, who normally travels 

through Okene in Kogi State, 

said he now used the Obajana-Kabba 

road, and called 

on other companies to emulate 

the Dangote Group. 

Most of the motorists 

who spoke with our reporter 

hailed Dangote and urged 

governments at all levels to 

the partner Dangote Group 

in road construction. 

They called for a timely 

completion of the project, 

saying it would make transportation 

and businesses 

across the two regions easier. 

A statement from the 

Corporate Communications 

Department of the Dangote 

Group said: “Concrete road 

last longer than asphalt 

roads and do not have potholes. 

It does not require 

frequent maintenance as asphalt 

roads. It saves fuel for 

motorists and protects tyres 

from wear and tears.”

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BUSINESS DAY 

Insight 

NEWS YOU CAN TRUST I MONDAY 09 APRIL 2018 

While I was away (2): Obasanjo’s pious pontification 

C002D5556 

fivethings 

for your new week 

Fascinating business facts 

I 

conclude my “While 

I was away …” series 

this week on the recent 

intervention 

by former President 

Olusegun Obasanjo. In a 

grandiloquently termed 

“special statement” in January 

this year, Obasanjo cautioned 

President Buharia 

gainst seeking re-election, 

and called for a“Coalition 

for Nigeria”, a movement 

he saidwould “take Nigeria 

out of Egypt to the promised 

land”. It was typically sanctimonious 

and pontificatory. 

Sadly, media coverage 

of the intervention was 

largely uncritical. Nigerians, 

it seems, are unable or 

unwilling to engage Obasanjo 

intellectually or experientially. 

Yet, for a man 

who behaves as the nation’s 

conscience, and claims the 

inalienable rights to dictate 

its future, Obasanjoshould 

be challenged on his ideas 

and his past! 

So, we mustdeconstruct 

his “special statement” 

through the prism of his 

place in history. For me, 

that means considering two 

main characteristics that 

make him sui generis.The 

first is that Obasanjo is Nigeria’s 

most serendipitous 

leader;the second, he isthe 

country’s No. 1 Svengali. 

Take the first. Why is 

Obasanjo Nigeria’s most 

serendipitous leader? Well, 

because he never at any 

time sought the leadership 

of this country, but it was 

alwaysbestowed on him. 

He was either in the right 

place at the right time or 

a beneficiary of Nigeria’s 

geopolitics. 

In 1976, Obasanjo became 

head of state after 

the brutal assassination of 

his boss, General Murtala 

Muhammed. Twenty-three 

years later, after the annulment 

of the June 12 1993 

presidential election and 

the death of MKO Abiola, 

the winner, in prison, there 

was a national consensus 

that, to appease the South 

West, the next president 

must be Yoruba. But the military 

insisted that Obasanjo, 

a retired general, must be 

that Yoruba, according to 

General Ishaya Bamaiyi, a 

former chief of army staff, 

in his book, Vindication of 

a General. So, Obasanjo 

became president in 1999 

after an election conducted 

GLOBAL PERSPECTIVES 

OLU FASAN 

Fasan, a London-based lawyer and 

political economist, is a Visiting 

Fellow at the London School of 

Economics.o.fasan@lse.ac.uk, 

twitter account: @olu_fasan 

Obasanjo 

by the military! 

Obasanjo is thus a 

uniquely privileged Nigerian. 

But,as the Bible says, “To 

whom much is given, much 

is expected”. So, how much 

has he given back? Recently, 

the former president, 83, 

said he would “commit suicide” 

if Nigeria lacked hope. 

If a British leader said that 

he would be condemned 

for glamorising suicide and 

sending the wrong message 

to frustrated youths! But, 

leave aside the blustering, 

what did Obasanjo do since 

1976, when he first assumed 

the leadership of this country, 

to help build a hopeful 

Nigeria? Well, let’s turn to 

his Svengalian character. 

Obasanjo is Nigeria’s No 

1 Svengali because of his 

controlling influence on 

the selection of this coun- 

And they did: Yar’ Adua, 

because of his terminal 

illness; Jonathan, later as 

president, because of his inconsequentiality 

and abject 

lack of leadership. 

And what about Buhari? 

In December 2013, Bola 

Tinubu, former governor of 

Lagos State, led leaders of 

the newly formed All Progressives 

Congress (APC) 

to Obasanjo in Ota, and 

told him: “We are resolved 

and determined to rescue 

Nigeria. We want you to 

lead the mission, we want 

you as navigator”. Obasanjo 

became their “navigator”! 

His open support for APC 

acceleratedthe collapse of 

his own party, the People’s 

Democratic Party, and 

smoothed the way for Buhari’s 

election. 

Obasanjo said he knew 

The test of leadership is judgment. 

Obasanjo failed it by imposing mediocre 

leaders on Nigeria, and in many 

of his actions in government. But you 

will not detect a whiff of regret from his 

sanctimonious pontifications. Instead, 

he uses his books and letters to rosetint 

his achievements. For instance, 

Obasanjo said in his “special statement” 

that his civilian administration “made 

Nigeria truly a land flowing with milk 

and honey”. What a perfidious distortion 

of history! 

try’s leaders. Indeed, he 

once boasted that he’s been 

instrumental to the emergence 

of Nigeria’s civilian 

presidents since 1979. But 

he always imposed weak 

and ineffectual leaders on 

the country. He favoured 

the diffident Shehu Shagari 

as president in 1979, telling 

us the best person didn’t 

have to win; he handpicked 

the sickly Umaru Yar’ Adua 

in 2007 and paired him 

with the pathetically puny 

Goodluck Jonathan, setting 

both of them up to fail. 

Buhari was weak on economic 

issues, but thought 

he could “make use of good 

Nigerians”. In other words, 

he put his faith in technocracy. 

Babashould have 

read “The Political Economy 

of Policy Reforms”, edited 

by the famous economist 

John Williamson. Economic 

technocrats cannever deliver 

radical and successful 

reforms without “the 

presence at the top of a 

political leader with a vision 

of history”. Buhari is not that 

kind of leader. He disdains 

experts and has atavistic 

views on economic policy. 

For over a year, Buhari 

refused to listen to those 

he disparagingly labelled 

“the so-called economists” 

about the Naira’s fixed value, 

even though Nigeria 

was rapidly haemorrhaging 

foreign exchange. Yet, despite 

Buhari’s pathological 

weaknesses, Obasanjo was 

willing to play the Russian 

Roulette with Nigeria by 

putting his weight behind 

Buhari’s candidacy. 

But, now, Baba has 

turned on his protégé with a 

vengeance, accusing Buhari 

of running “a failed government”. 

He has warned him 

against seeking re-election, 

citing his behaviour, age 

and health. Yet, in 2015, 

the same Obasanjo blithely 

dismissed every concern 

raised about Buhari’s age, 

health and worldview, including 

his clannishness. 

He went all out to ensure 

Buhari’s victory. Why? Well, 

he said, for him, it was“Any 

OptionBut Jonathan”, even 

if that “option” was a retrograde 

former dictator with 

a closed view of the world. 

For Nigerians, the choice 

between Jonathan and Buhari 

was one between the 

devil and the deep blue sea. 

Obasanjo helped tip the 

balance in favour of Buhari. 

Dignified neutrality would 

have spared Baba’s blushes 

today. But Obasanjo can’t 

be politically neutral, despite 

his self-proclaimed 

“non-partisan position”! 

The test of leadership is 

judgment. Obasanjo failed 

it by imposing mediocre 

leaders on Nigeria,and in 

many of his actions in government. 

But you will not 

detect awhiff of regret from 

hissanctimonious pontifications. 

Instead, he uses 

his books and lettersto rosetint 

his achievements. For 

instance, Obasanjo said 

in his “special statement” 

that his civilian administration 

“made Nigeria truly a 

land flowing with milk and 


7.1% 

Tanzania’s economy grew around 7.1 percent last year, 

beating the government’s own revised forecast, Prime 

Minister Kassim Majaliwa said. Majaliwa said East Africa’s 

third-largest economy grew faster than expected last year 

owing to an increase in mining activity. “Latest data ... 

shows that the country’s gross domestic product grew 7.1 

percent in the period between January and December 

2017, compared to a GDP growth of 7.0 percent in 2016,” 

Majaliwa said in the parliamentary presentation. 

11,044 

Nissan Motor Co. plans to start assembling vehicles in 

Kenya, bolstering government plans to develop a regional 

auto-manufacturing hub in East Africa’s biggest economy. 

The Japanese automaker is the latest to target Kenya 

where sales of new units fell 20 percent last year to 11,044. 

Volkswagen AG, PSA Peugeot and CNH Industrial NV have 

announced plans for assembly lines in Kenya in the past 

18 months. Nissan will initially put together pick-up trucks 

from semi-knocked-down kits, or SKDs, if the government 

agrees to waive a 25 percent import tax, according to Jim 

Dando, director of Africa operations for Nissan. 

$2.5bn 

Ghana is considering selling bonds from China to Japan 

as the country prepares to issue as much as $2.5 billion in 

foreign-currency debt this year. Ghana will use $1 billion to 

help meet its 2018 budget and the remainder to refinance 

dollar bonds of as much as $1.5 billion should it be able to 

sell the securities at a cheaper rate. Apart from selling dollar 

debt, Ghana is weighing an issuance of Islamic securities, 

so-called Panda bonds in mainland China and Samurai 

notes in Japan. 

13.48% 

Nigeria is joining a silent revolution. Only three countries 

have issued a sovereign green bond — Poland, France and 

Fiji — and now Nigeria is the most recent member of the 

movement. As an oil-producing giant, the country has 

long been in search of a trump card against falling crude 

prices. In December, the government issued a N10.69bn 

($29m) green bond to fund local solar and forestry projects. 

The fully subscribed bond’s tenor is five years, and investors 

will receive a 13.48 per cent annual coupon, creating 

high expectations for the environmental projects linked to 

the government’s use of proceeds from the bond. 

16.9% 

BlackRock, the world’s largest asset manager, is to 

launch a range of new funds that exclude firearms 

manufacturers and retailers following a deadly school 

shooting in Florida in February. New York-based 

BlackRock is one of the biggest shareholders of the 

three largest US publicly traded gun companies. It 

owns 16.9 per cent of Sturm Ruger; 11.1 per cent of 

American Outdoor Brands; and 12.7 per cent of Vista 

Outdoor. 

Published by BusinessDAY Media Ltd., The Brook, 6 Point Road, GRA, Apapa, Lagos. Ghana Office: Business Day Ghana Ltd; ABC Junction, near Guinness Ghana Limited, Achimota – Accra, Ghana. 

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Editor: Anthony Osae-Brown. All correspondence to BusinessDAY Media Ltd., Box 1002, Festac Lagos. ISSN 1595 - 8590.

BusinessDay 09 Apr 2018

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