BusinessDay 12 Apr 2018

Nigeria’s fiscal space gets 

boost as oil hits 4-year high 

... Trump considers military attack on Syria 

DIPO OLADEHINDE 

The price of Brent crude, 

Nigeria’s benchmark 

grade hit a high of over 

$72 per barrel which 

is its strongest since early December 

2014 as geopolitical 

concerns in the Middle East and 

rising US crude inventory put 

the oil bulls firmly back in the 

driver’s seat. 

Rallying oil prices will lead to 

an increase in crude oil revenue 

and also boost Nigeria’s foreign 

reserves, according to Emmanuel 

Afimia, Energy Economist at 

Afimia Consulting Services. 

“The speculators in the future 

market are responsible for the 

increase; this is because they 

have predicted a fall in crude oil 

Continues on page 38 

L-R: Segun Agbaje, managing director/CEO; Osaretin Demuren, chairman, and Erhi Obebeduo, company 

secretary, all of GTBank, at the bank’s 28th annual general meeting in Lagos. See BusinessDay Market Monitor on page 4 

NEWS YOU CAN TRUST I **THURSDAY 12 APRIL 2018 I VOL. 15, NO 31 I N300 @ g 

Fresh twist in Oando 

suspension saga 

As regulators give conflicting accounts 

IHEANYI NWACHUKWU & 

LOLADE AKINMURELE 

Confusion over the 

lifting of the suspension 

of trading on 

Oando Plc’s shares 

heightened yesterday, 

when hours after the start 

of trading there was a reversal 

of the lifting of the technical 

suspension for absolutely no 

reason. 

As directed, trading in 

the company’s shares began 

Wednesday morning to the 

excitement of the market. On 

receipt of the Commission’s 

directive, The Exchange put 

the process in place to lift the 

Technical Suspension, including 

testing on its trading system. 

The share price had risen to 

N6.30 a 5.8 percent increase 

from N5.99 in less than three 

hours of trading. As at 11:20am 

on Wednesday April 11, 2018, 

Oando Plc shares was on demand 

(bid) of 95 million units 

with 80 million units queued at 

the limit up of N6.60. 

To the disappointment of 

the general public, there was 

a reversal of the lifting of the 

technical suspension on Oando 

Plc’s shares by the capital market 

regulator. The share price 

remains at N5.99 position as at 

the time of filing this report. A 

market source said the NSE also 

reversed all transactions done 


L-R: Rob Shuter, group chief executive officer/president, MTN; Pascal Dozie, chairman, MTN Nigeria; Tobechukwu 

Okigbo, corporate relations executive, MTN Nigeria; Vice President Yemi Osinbajo; Ferdinand Moolman, 

chief executive officer, MTN Nigeria, and Phuthuma Nkhleko, group chairman, MTN, during a courtesy 

visit to the Vice President in Abuja, yesterday. 

Buhari meets 

Archbishop of 

Canterbury, explains 

declaration for 2019 

TONY AILEMEN, Abuja 

President Muhammadu 

Buhari has explained why 

he declared his intention 

to run for another term in office 

on Monday, April 9, 2018, during 

the National Executive Committee 

(NEC) meeting of the All 

FG extends VAIDS 

to June 2018 



President Muhammadu 

Buhari has approved the 

extension of the Voluntary 

Assets and Income Declaration 

Scheme (VAIDS) to June 30, 2018. 

A statement by the Special 

Adviser to the President on Media 

and Publicity, Femi Adesina, 

said, “the short extension after 

the original March 31 date is 

based on the appeals of professional 

bodies and individual 


Inside 

Japaul losses hit 

N13.02bn in FY 17 P. 4

Thursday 12 April 2018 

2 BUSINESS DAY


BUSINESS DAY 

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4 BUSINESS DAY 

C002D5556 

Commodities 

Brent Oil 

$70.61 

Cocoa 

US $2,524.00 

Japaul losses hit N13.02bn in FY 17 

BALA AUGIE 

NSE 

Biggest Gainer Biggest Loser 

Mobil 

Betaglas 

N192 

7.56pc N71.95 -4.95pc 

40,846.24 

Japaul Oil and Maritime Services 

(JOM) Plc released its 

results yesterday showing 

total liabilities of N56.17 billion 

as at December 2017, 

exceeded total assets of N28.18 

billion. 

This resulted in a negative 

shareholders fund of N28.17 billion 

in the period under review. 

Negative shareholder equity on 

a company’s balance sheet is a red 

flag that should prompt potential 

investors to take a closer look before 

committing their money. 

Negative stockholders equity 

arises when a firm has been recording 

recurring losses throughout 

its existence and if symptoms 

persist could lead to bankruptcy. 

Japaul Oil has negative retained 

earnings of N49.18 billion. 

For the year ended December 

2017, the Maritime service firm 

Fresh twist in Oando suspension... 

Continued from page 1 

on Oando shares. 

It would be recalled that the 

NSE had in the letter signed by 

Tinuade T. Awe, executive director, 

regulation, notified Oando Plc of 

the lifting of technical suspension 

on trading in its shares. 

The NSE letter was dated April 

10, 2018 and addressed to Ayotola 

Jagun, company secretary, Oando 

Plc. 

“We refer to all prior communication 

regarding the technical suspension 

of trading in the shares of 

Oando Plc (Oando) implemented 

on the directive of the Securities 

and Exchange Commission (Commission) 

on 23 October 2017. 

“Please, be informed that further 

to a 9 April 2018 directive of 

the Commission, The Exchange 

lifted the technical suspension 

placed on Oando’s shares after 

the close of trading today, 10 April 

2018. Consequently, there will be 

no impediment to price movement 

in the shares of Oando when the 

market opens for trading (tomorrow), 

11 April 2018,” NSE stated. 

This development in Nigeria’s 

capital market is raising questions 

on who is controlling the Nigerian 

financial market – individuals or 

the institutions. 

“Both the NSE and SEC owe it to 

the general public to give us good 

reason why this has happened,” 

an informed market source said 

Wednesday. 

According to our source, “This 

level of indecision with the financial 

gate keepers of the country 

is disgraceful! The international 

market is watching, foreign investors 

are watching and once again, 

the NSE and SEC have made a 

mockery of the market.” 

No reason was given by the 

NSE for the continuous placing of 

the company shares on technical 

suspension even after early trading 

yesterday. 

Several calls and messages to 

personnel in the communications 

department of Nigerian Stock 

Exchange (NSE) were neither returned 

nor replied as at press time. 

“We don’t know what is going 

on again. We woke up this morn- 

recorded a loss after tax of N13.20 

billion as against N21.01 billion loss 

recorded the previous year. 

Sales dipped by 38.11 percent to 

N1.90 billion in the period under 

review as against N3.07 billion loss 

recorded the previous period. 

The firm attributes weak sales to 

weak economic fundamentals that 

hit the oil and gas sector with its 

impact on the maritime industry. 

A drop in oil price and a severe 

dollar shortage that hindered 

companies from importing raw 

materials and equipment to meet 

production saw the country slip 

into its first recession in 25 years. 

However a rebound in crude 

oil price and production coupled 

with a favourable foreign exchange 

policy helped the country exit the 

recession in 2017. 

The gross domestic product 

of Africa’s largest oil producer expanded 

for three straight quarters 

last year after a 1.6 percent contrac- 

ing and were very happy but all of 

a sudden the story changed. But 

the NSE is not saying anything. It 

is causing a lot of confusion. The 

social media is agog,” an investor 

in Oando Plc told BusinessDay. 

Meanwhile, a top executive at 

the SEC who spoke to BusinessDay 

simply said “We directed for the 

lifting of technical suspension on 

the shares of Oando Plc so investors 

can trade their shares while the 

forensic audit is going on. If they 

said we have suspended it again, 

did you see another letter to that 

effect? As far as we are concerned 

technical suspension on Oando 

Plc shares have been lifted. Wait 

till tomorrow morning (Thursday 

morning) and see. Maybe they 

have their own in house issues at 

the NSE”. 

Currently, Deloitte is carrying 

out a forensic audit of Oando under 

the instructions of SEC. 

In a letter on the Nigerian Stock 

Exchange dated April 11, 2018, 

Oando Plc informed the public and 

its stakeholders that its Board of Directors 

held a meeting on Tuesday, 

April 10, 2018 and approved the 

2017 Audited Financial Statements 

(the Accounts). 

Oando Plc expects to be in a 

position to file the accounts by the 

second week in May 2018 “as previously 

communicated”. 

Meanwhile, there was a fresh 

twist, Wednesday, to the forensic 

audit of Oando, after one of the 

firms charged with the task of carrying 

out the audit said the process 

was yet to commence, thereby 

contradicting an initial guidance 

by SEC that the audit commenced 

in March. 

In a text response to Business- 

Day questions, Nasir Muhammad, 

a principal partner in Nasiru Muhammad 

and Co, one of the five 

firms engaged by SEC for the audit 

on Oando, said “To date, our firm 

has not been notified to move to 

Oando site yet, either by SEC or the 

lead consultant, Deloitte. 

“And our engagement letter 

has not been vacated/withdrawn 

to our knowledge at the moment,” 

Muhammad said from Port-Harcourt 

on Wednesday. 

businessday market monitor 

Bitcoin 

Everdon Bureau De Change 

2,426,498.59 +0.81pc 

Powered by 

$-N 

£-N 

€-N 

BUY SELL 

360.00 363.00 

500.00 510.00 

436.00 446.00 

tion in 2016, with year-on-year 

growth reaching 1.9 percent in the 

final three months of 2017. 

Japaul Oil’s total expenses of 

N8.41 billion is 4.4 times revenues 

recorded in the period under review, 

which resulted in operating 

loss of N1.79 billion. 

The Maritime firm is highly 

geared or indebted as its capitalization 

ratio (ratio of total liabilities to 

total assets) increased to 200.06 

percent in December 2017 as 

against 163.52 percent as at December 

2016. 

A high capitalization ratios 

or gearing level means the large 

chunk of the firm’s balance sheet 

is financed by via debt. In other 

words, the firm is exposed to financial 

risk as it will have to pay huge 

interest out of already battered 

earnings. 

Japaul Oil’s finance costs or 


L-R: Jordi Borrut Bel, MD/CEO; Mark Rutten, finance director, and Kufre Ekanem, corporate affairs adviser, 

all of Nigerian Breweries (NB) plc, during the company’s pre-annual general meeting/press briefing in Lagos, 

yesterday. 

Pic by Pius Okeosisi 

The five firms engaged by SEC 

for the Oando audit are TJADAF 

Consulting, the stockbrokers engaged 

to review the allegations of 

insider dealings; Akintola Williams 

Deloitte and Touche, the forensic 

auditors engaged to review the allegation 

of financial misappropriation; 

Nasiru Muhammad and Co, 

joint forensic auditors; SP Ajibade 

and Co, the legal counsel engaged 

to review all the legal documents; 

and United Securities Plc, the 

registrars engaged to review and 

authenticate the register of the 

company with a view to ascertaining 

the true shareholding position 

of the shareholders. 

Olukoju Anthony, a managing 

partner at Deloitte, did not answer 

two phone calls seeking clarification 

over the matter. 

Akintunde Odunsi, the managing 

director at TJDAF consulting, 

another of the five firms tapped by 

SEC for the Oando audit referred 

our reporter to the SEC. A source at 

SEC claimed the audit was on and 

that Deloitte was currently on site. 

On October 18, 2017, the SEC 

ordered a forensic audit of Oando’s 

affairs following petitions from two 

of the company’s shareholders 

FOREIGN EXCHANGE 

TREASURY BILLS 

Market Spot $/N 3M 6M 

I&E FX Window 359.81 -0.09 -0.51 

CBN Official Rate 305.55 13.19 14.75 

Progressives Congress (APC). 

The President Buhari stated this 

when he received the Archbishop 

of Canterbury, His Grace Justin 

Welby in London Wednesday, at 

the Nigerian House in London, 

according to a statement by Special 

Adviser to the President on Media 

and Publicity, Femi Adesina. 

According to the President “I 

declared before leaving home because 

Nigerians were talking too 

much about whether I would run or 

not. So, I felt I should break the ice. 

We have many things to focus on, 

like security, agriculture, economy, 

anti-corruption, and many others. 

We needed to concentrate on them, 

and politics should not be a distraction. 

The majority of Nigerians appreciate 

what we are doing, and that 

is why I am re-contesting.” 

The President recounted some 

successes of the administration to 

his guest, with whom he has built 

a deep friendship in recent times, 

and was quite particular about 

over alleged insider dealings and 

manipulation of the company’s 

shareholding structure allegedly 

in breach of the Investments and 

Securities Act 2007 and the SEC 

Code of Corporate Governance for 

Public Companies. 

The Oando crisis thickened 

and soon led to the suspension of 

former Director General of SEC, 

Mounir Gwarzo. 

Gwarzo’s temporary replacement, 

Abdul Zubair, said last 

month that the commission has 

transmitted its directives to Oando 

for the commencement of the 

forensic audit. 

Zubair said at the time that “the 

SEC has duly informed the firm 

of Akintola Williams Deloitte and 

Touche to proceed with the audit. 

He also stated that the “audit will 

proceed immediately in a transparent 

and thorough manner.” 

Minority Shareholders Association 

of Oando Plc under the aegis 

of Proactive Shareholders Association 

of Nigeria (PROSAN) sent 

a petition to the House Committee 

on Capital Market accusing the 

SEC of shielding Oando Plc from 

the audit exercise. 

The petition was signed by 

FMDQ Close 

5 Years 

0.00% 

13.50% 

FGN BONDS 

10 Years 

0.04% 

13.68% 

20 Years 

-0.02% 

13.53% 

Buhari meets Archbishop of Canterbury... 


strides in agriculture. 

“We have cut the importation of 

rice by about 90 percent, saving billions 

of dollars in the process. People 

who rushed into petrol money 

have now gone back to agriculture. 

Even professionals have gone back 

to the land. Nigeria should be able 

to feed itself comfortably soon. I 

am so pleased,” the President said. 

On the war against insurgency, he 

stressed the need for continuous education 

of the people, “so that they can 

be free from religious manipulation,” 

adding that no true religion advocates 

the hurting or killing of the innocent. 

Responding to his guest’s comment 

on the clashes between herdsmen 

and farmers in different parts 

of Nigeria, the President submitted: 

“The problem is even older than 

us. It has always been there, but now 

made worse by the influx of armed 

gunmen from the Sahel region into 

different parts of the West African 

sub-region. These gunmen were 

trained and armed by Muammar 


Taiwo Odeninde and Barrister 

Nnodu Okeke as National coordinator 

and Treasurer, and the 

petition was captioned “Dangerous 

and malicious and deliberate 

attempt by the Acting DG of SEC, 

Abdul Zubair to cover up Oando 

plc and protect the company from 

the forensic audit. 

Another group of Concerned 

Shareholders of Oando Plc also on 

Tuesday April 10, 2018 called on 

President Muhammadu Buhari; 

Vice President Yemi Osinbajo; 

Senate President Bukola Saraki; 

Speaker, House of Representatives, 

Yakubu Dogara and other 

well-meaning Nigerians to prevail 

on the Nigerian Stock Exchange 

(NSE) and the Securities & Exchange 

Commission (SEC) to lift 

the technical suspension placed 

on the shares of Oando without any 

further delay. 

Patrick Ajudua, head of the 

Concerned Shareholders of Oando 

said the continued suspension of 

Oando shares was sending wrong 

signals to the global community 

about the seriousness of the Federal 

Government in attracting 

foreign direct investments (FDIs) 

to bolster the economy.


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COMMENT 

comment is free 

Send 800word comments to comment@businessdayonline.com 

Who are those Nigerians desperate for Buhari to contest in 2019? 

Chris Akor, a First Class 

graduate of Political Science, holds an 

MSc in African Studies from the University 

of Oxford and is BusinessDay’s 

Op-Ed Editor 

christopher.akor@businessdayonline.com 

President Buhari, on 

Monday, officially announced 

that he will 

run again for 2019 election. 

That was not surprising. 

Anyone conversant with 

Nigeria’s political terrain will have 

seen the signs long ago. But what 

is interesting is the reason he gave 

for seeking a second term in office. 

Like others before him, he said he 

was only responding to the clamour 

by Nigerians for him to contest 

again in 2019. 

“People have been asking me to 

declare for re-election and some 

have been asking me when I am 

going to declare. I want to give the 

NEC the honour to be the first to 

hear it. I have decided to contest 

the 2019 elections,” Buhari told a 

closed door meeting of his party’s 

National Executive Council at the 

party’s secretariat in Abuja. 

Surprisingly, he may be quite 

sincere about the claim. Despite 

the heavy criticisms that has 

trailed the president and his 

administration’s handling of the 

economy, jobs and security of 

late, the president has enjoyed 

tremendous support from his 

party, state governors, ministers 

and special advisers under his. 

This is understandable. Most of 

the governors came to office in 

2015 riding on the president’s 

popularity. And with their lacklustre 

performances in the past 

three years, they are now more 

desperate to ride on the back 

of his popularity and cult-like 

followership especially in the 

northern part of the country, to 

get re-elected for a second term 

or reappointed into key positions. 

And they have gone to ridiculous 

extents to push his candidacy. 

Since the beginning of 2017, they 

have been sending emissaries 

and going in numbers almost 

on a weekly basis to convince 

the president to run again. The 

other day, the Kano state governor, 

Abdullahi Ganduje said his 

government is ready to take legal 

action if Buhari refuses to seek 

re-election. 

“I am happy that it is not the 

President that said he wants to 

continue. It is the people that are 

saying continue. But Mr President 

has not made up his mind 

yet. Kano state government will 

take him to court any time he 

decides not to contest. We are 

waiting for him,” he told news 

men recently. 

His Kogi state counterpart, 

“We are politicians and those 

of us that you see here want 

the President to contest for 

a second term of office. So, 

everything is about 2019; 

there is no hiding that. We 

have no apologies for that” 

Yahaya Bello, went beyond the normal 

to restate his absolute loyalty 

to the president. “I am an ardent 

supporter of President Muhammadu 

Buhari...If Buhari asks me to 

jump into fire, I will not hesitate to 

jump into it.” 

Last week, a delegation made up 

of the governors of Kogi, Kano, Plateau, 

Niger, Yobe, Kaduna, and Adamawa 

states visited the president 

to impress on him to contest the 

2019 elections. Speaking on their 

behalf the Kaduna state governor, 

Nasir el Rufai said bluntly: 

“We are politicians and those of 

us that you see here want the President 

to contest for a second term of 

office. So, everything is about 2019; 

there is no hiding that. We have no 

apologies for that. 

“We believe in the President, 

we want him to keep running the 

country in the right direction. So, 

people can speculate about 2019; 

we have no apologies.” 

Besides the governors, ministers, 

party members and special advisers 

who want to remain relevant 

in government, there is the kitchen 

cabinet or the powerful cabal 

who, exploiting the President’s 

ignorance, lack of understanding 

of economics and most complex 

issues of governance, as well as 

vulnerability due to old age and 

ill health, have completely taken 

over governance. What makes the 

takeover by this shadowy group 

more complete is the tendency of 

the President, a highly provincial 

man himself, to over-trust and 

over delegate authority to his close 

aides and associates – appointed 

or not – who are mostly his relatives 

and or people from his part 

of the country. Stories abound 

of these powerful individuals 

determining key appointments. 

It is an open secret in the country 

that what is needed for a job, a 

connection or contract with the 

government is to get to meet a 

member of this powerful group. 

Unfortunately, the President 

himself empowered this group 

early in his administration to be 

the clearing house and policy 

centre of his government. He even 

ordered that “all communications 

and appointments from you (ministers) 

to the Presidency should be 

routed through the office of the 

Chief of Staff as it is the normal 

(procedure) in this presidential 

system.” 

So complete is the takeover of 

the government by this shadowy 

group that even Buhari’s wife felt 

completely sidelined and left out 

of the scheme of things that she 

was forced to take the unprecedented 

step of going public with 

her discontent when she accused 

a powerful cabal of hijacking her 

husband’s government. 

Of course, the cabal, prominent 

among which are the President’s 

nephew, Mamman Daura; 

the Senior Special Assistant to the 

President on Domestic Affairs, 

Sarki Aba; The President’s Chief 

of Staff, Abba Kyari; and Personal 

Assistant to the President; Tunde 

Sabiu, have completely walled 

off the president and filters any 

communication the president has 

with the Nigerians and the outside 

world. Naturally, they determine 

what the president hears and 

knows and what he needs to do 

or say. It was the same cabal perhaps, 

that ensured the president 

did not know that the Inspector 

General of Police, whom the 

president ordered to relocate to 

Benue until the killings in the state 

is brought to an end, spent only 

one day in Benue and absconded. 

Even when he was told when he 

eventually visited Benue, it is the 

same cabal that has ensured that 

no disciplinary action was taken 

against the IGP. 

It is only natural that this cabal 

will be loath to losing all their 

powers and privileges and they 

have carefully ensured the president 

heard only the voices of only 

those calling on him to run again 

and not the voices of disgruntled 

Nigerians. 

Send reactions to: 

comment@businessdayonline.com 

TUNJI ANDREWS 

Andrews is lead economist at Time, 

Trade and Commodities (TTAC). 

The year 2012 was 

very significant for 

e-commerce in Nigeria 

for at least 

two reasons. Firstly, the 

government, through the 

Central Bank of Nigeria 

(CBN), had set up a policy 

it hoped would curb excesses 

in the handling of 

cash in Nigeria. The second 

thing that happened 

was that, just a few weeks 

to the rollout of cashless 

Lagos, the CBN made two 

key tweaks to the policy 

that at the time seemed 

bold but in retrospect, now 

seem not well thought-out 

decisions. 

The first tweak was the 

Over-The-Counter limits, 

having prescribed cash 

handling charges on daily 

withdrawals above five 

hundred thousand naira 

(N500,000.00) as against 

Mobile money in Nigeria – good, can be better 

the initial one hundred 

and fifty thousand naira 

(N150,000.00) for individuals 

and three million naira 

(N3,000,000.00) for corporate 

bodies as against 

the initial two million 

naira (N2,000,000.00). 

While a few of us pointed 

out how this might 

make the policy redundant 

to curbing cash use, 

especially since the number 

of people who actually 

go to take N500,000 and 

above over the counter 

was really not that much, 

compared to those who 

fall between the N50,000- 

N250,000 bracket (CBN’s 

own analysis showed that 

only 10 percent of daily 

banking transactions are 

above N150,000), the CBN 

decided to engage in a 

needless campaign, trying 

to explain that the CASH- 

LESS in the policy actually 

meant LESS CASH. 

The apex bank spent an 

awful amount of time on 

PR campaigns, with little 

time evaluating the efficiency 

of the policy. 

The other tweak was 

in insisting that the mobile 

money operations be 

bank-led (which wasn’t 

a problem), but to emphasize 

this, no telco was 

given a mobile money licence. 

I asked the crucial 

“WHY” question at the time 

and the usual answer was 

“how it could be a threat 

to retail banking”, as it has 

been seen in other parts 

of Africa. It even echoed 

around West Africa that in 

2016, Kumangkem Kennedy 

Kubuga wrote a rebuttal paper 

titled “Mobile Money – A 

Potential Threat to Banks?” 

The long story short is that 

central banks across Africa 

chose to see the success of 

MPesa in Kenya as a loss for 

retail banking, rather than a 

win for financial inclusion. 

To be honest, though, I 

wasn’t too worried at the 

time, as looking at the list 

of 21 mobile money licences 

issued, I believed we had 

enough within them to drive 

financial inclusion into the 

rural areas and strengthen 

e-commerce in the urban 

areas. What has, however, 

happened is that banks have 

basically made it an add-on 

service to already existing 

customers, while the real 

heavy-lifting of using it as a 

tool for financial inclusion 

has been left to the likes of 

PagaTech (Paga), who now 

have over 5 million subscribers 

but are now faced 

with new regulation, with 

CBN rules, effective from 

the end of December 2017, 

stating that operators must 

have NGN1 billion ($2.8 

million) in their reserves 

to operate, a sum which is 

expected to rise to NGN2 

billion on 1 July, 2018. 

Surely now, we must 

return to this table to reevaluate 

the successes and 

the failures of the cashless 

policy and its offspring. 

While we stand afraid of 

what happened in Kenya, 

let us remember that 

Kenya leads the world in 

developing mobile money 

payment systems and in 

widespread usage, despite 

Kenya’s extreme poverty, 

ranking 187 in per-capita 

GDP. Of the country’s 

47 million people, seven 

in 10 adults (69 percent) 

have financial accounts 

(as against 41.1 percent 

in Nigeria). In addition 

to mobile money, financial 

services are available 

through a diverse group 

of providers, including 

banks, nonbank financial 

institutions and informal 

financial groups. Nearly 

two-thirds of the country is 

rural, and three-quarters 

of adults earn at least part 

of their incomes from agriculture. 

Nigeria, really, should 

be taking huge strides in 

financial inclusion using 

mobile money but we are 

still handling teething issues 

where talk has begun 

to emerge that the CBN 

may revoke the licences 

of at least 15 struggling 

mobile money operators 

under new minimum finance 

rules. 

To drive the nation’s 

(CBN’s) vision of 80 percent 

financial inclusion as 

stipulated in its National 

Financial Inclusion Strategy, 

we must push through 

with CBN governor, Godwin 

Emefiele’s remarks 

on eventually giving licences 

to telecommunication 

companies (telcos) 

to provide mobile money 

services. I believe they 

are better suited to offer 

products that would see 

a massive rolling-out of 

agent networks and creating 

awareness to increase 

adoption, and adoption of 

digital financial services 

as simple, flexible and easy 

alternative channels for 

reaching remote areas and 

rural hinterlands. 


comment@businessdayonline.com


COMMENT 

C002D5556 

BUSINESS DAY 

11 

comment is free 

Send 800word comments to comment@businessdayonline.com 

Women entrepreneurs in an emerging economy running a bankable business (I) 

OYINKAN ADEWALE 

Mrs. Adewale is Executive Director, 

Chief Financial Officer, Union 

Bank. 

Introduction 

In 2017, Nigeria’s Gross 

Domestic Product (GDP) 

growth was 0.83% (compared 

to a decline of 1.58% 

in 2016). In the second quarter 

of 2017, the country officially 

emerged from arecession which 

had lasted about a year. The Services 

sector grew by 0.1% in the 

fourth quarter of 2017, marking 

the first time the sector had grown 

since early 2016. 

Despite emerging from the recession 

last year, Nigeria continues 

to struggle with high unemployment 

rates. In the third quarter of 

2017, the country’s unemployment 

rate climbed to 40% (combining 

unemployment and underemployment 

rates), from 37% in the 

second quarter of 2017 and 35.2% 

at the end of 2016. 

Women make up the majority 

of the unemployed in Nigeria. In 

the third quarter of 2017, female 

unemployment recorded 43% in 

comparison to 37.0% for male. 

These statistics are sobering: for 

women in Nigeria, although underemployment 

improved from 

24.2% to 21.8%, unemployment 

worsened rather sharply from 

16.3% to 21.2% in 9 months (from 

the fourth quarter of 2016 to the 

third quarter of 2017). 

To give some context to these 

figures, for women in the UK, unemployment 

rate was 4.2% and in 

the US, 4.1% in the third quarter 

of 2017. The Nigerian statistics are 

plainly far worse. 

The case for job creation for 

Nigerian women 

Clearly, there is the urgent need 

to reduce women unemployment 

rates in Nigeria. In order to match 

the unemployment rates in the 

UK, we would need to create 7.1 

million jobs. The question however 

remains-“Who is responsible for 

creating these jobs - the Government 

or the people themselves?” 

Nigeria is the 7thmost populous 

country in the world and has a 

population estimated to be in excess 

of 180 million people with a growth 

rate of 2.6%. The World Economic 

Forum estimates that by 2060, Nigeria 

will be the third most populous 

country in the world, behind India 

and China. This paints a clear picture 

of the scale of work that needs 

to be done to ensure that there are 

sufficient jobs for the working class. 

Considering these figures, we 

would be mistaken to assume that 

World Bank records state 

that at the end of 2017, 

self-employed individuals 

made up 62.2% of the 

entire population of Sub- 

Saharan Africa, in contrast 

to 15.8% in the European 

Union and 10.5% in North 

America. 

the Government is capable of providing 

enough jobs to cater to our ever 

growing population. 

However, there seems to be a way 

out of this quagmire. 

It is often said that SMEs are “the 

engine of growth” in the economy; 

indicating that job creation is best 

achieved by delving into the world 

of entrepreneurship. World Bank 

records state that at the end of 2017, 

self-employed individuals made up 

62.2% of the entire population of Sub- 

Saharan Africa, in contrast to 15.8% 

in the European Union and 10.5% in 

North America. 

Becoming an entrepreneur 

According to Diane Hendricks, 

Co-founder of ABC Supply, “ ‘Entrepreneur’ 

is a word that means you’re 

going to work, take risks and be disappointed. 

It’s a big commitment.” 

The amount of work required to 

start a business should not be underestimated. 

Starting up a business 

requires a lot of determination and 

often, only pays in the long term. Another 

major ingredient for success is 

stamina to remain in the business 

despite any issues encountered. 

Starting a business also requires 

managerial skills. As one begins to 

build up a workforce, it is important 

to pull together a high performing 

team that will positively contribute 

to the business. 

Furthermore, when starting a 

business, there is the need to acquire 

the necessary qualifications. And it 

doesn’t end there! You need to keep 

attending trainings to keep abreast 

of changes in the industry and constantly 

building on this knowledge, 

to stay relevant. 

Choosing your niche: Deciding 

on the business to venture into 

If you decide that entrepreneurship 

is for you, you should 

start by identifying what you have 

a passion for and whether or not 

there is a demand for that product 

or service. An entrepreneur who 

is impassionate about his product 

or service will not be able to defend 

it effectively before a potential 

financier. At the first sign of stress 

or adverse wind, he or she is likely 

to give up. 

The next step would be to carry 

out proper research. Projects 

can be thoroughly researched 

on the internet and by attending 

conferences/seminars to ensure 

you broaden and deepen your 

knowledge. 

Questions that your research 

should answer include: Who else 

is offering this product or service? 

What is the gap in the market? Who 

needs the commodity? Is this a saturated 

market or greenfield? How 

profitable is it? The scope of the 

research is vast but the importance 

of carrying it out cannot be overemphasized. 

Potential financiers are 

be unlikely to give financial backing 

to an ill-informed promoter. 

After considering whether your 

passion is aligned with the gap in 

the market, a top-down analysis 

(reviewing from the economy to 

the industry and then the business) 

is helpful to assess and consider 

whether there is potential for 

further growth in the industry as 

a whole. Lastly, it is important to 

decide on the target market and to 

clearly define a niche. This should 

be followed by a review of the 

market dynamics. A useful tool in 

determining the competitive landscape 

is the Five Forces Analysis 

which explores concepts such as: 

the barriers to market entry, the 

level of threat of substitutes, the 

bargaining power of suppliers and 

customers and the extent of competitive 

rivalry and how these affect 

the market. 


comment@businessdayonline.com 

SOLA ONI 

Oni, Financial Journalist and 

Chartered Stockbroker is the CEO, 

Sofunix Investment and Communications 

Views expressed and 

positions taken on 

any economic policy 

by Financial Derivatives 

Company’s Managing 

Director, Mr Bismark Rewana 

cannot be ignored. He has 

paid his due. Prior to the 

much-delayed first meeting 

in the year of the nine wise 

men of the Monetary policy 

Committee (MPC) of Central 

Bank of Nigeria(CBN), Rewane 

had intuitively expected 

a one per cent reduction in 

the interest rate which currently 

stands at 14 per cent 

and stated that he did expect 

any change in the other key 

economic indicators . 

His intuitive expectation 

on the need for a reduction 

in interest rate is obviously 

understandable. Mr. Godwin 

Emefiele – led CBN has been 

working had to fix the economy 

that exited recession at 

the first quarter of last year. 

The Monetary Policy Rate 

(MPR) had peaked at 18.7 per 

cent on downward trend for 

almost eleven months to 15.4 

per cent. 

The Apex Bank’s target is 

within a range of six to nine 

per cent. Since November 

last year, MPR has stood at 14 

per cent, Cash Reserve Ratio 

(CRR), 22.5 per cent, and 

Asymmetric window, +200 

CBN’S unconventional silence on interest rate 

basis point and -500 basis 

point of MPR. 

Every quantum of change 

in interest rate has implication 

particularly on the financial 

market and economy 

in general. The apex bank 

worldwide changes interest 

rate upward or downward to 

ensure maximum employment, 

price stability and 

steady economic growth. 

When the interest rate is 

lower, companies can borrow 

at cheaper rate, grow 

businesses and employ more 

labour. Conversely, a high interest 

rate with low inflation 

regime constraints companies 

from borrowing for expansion. 

Many of them may 

embark on high cost control 

which may lead to spinning 

off of some businesses with 

attendant effect of downsizing 

labour. 

There is an inverse relationship 

between the money 

market and capita; market. A 

rise in interest rate spurs activities 

in the money market 

instruments as speculators 

take advantage of higher 

interest rate by moving their 

fund from the stock market to 

money market to invest in instruments 

such as Treasury 

Bills and Government Bond. 

The same speculators 

would embark on flight for 

safety by withdrawing their 

fund at a click of button from 

fixed deposits or fixed income 

securities to the stock 

market once the market is bullish. 

Speculators are high risk 

takers as they can win all or 

lose all. Nonetheless, they are 

key drivers in the capital market 

as they provide liquidity. 

But they need policy direction 

for enhanced calculated risk. 

Therefore, every change in 

the Minimum Rediscount Rate 

(MRR) has spill over effects on 

investment decision for both 

domestic and foreign portfolio 

investors. The current MRR at 

14 per cent while inflation is 

at 14.33 does not send comfortable 

signal. This perhaps 

explains why Rewane’s expectation 

was the need for the 

CBN to reduce the interest rate 

by one per cent ahead of the 

historic MPC’s recent meeting. 

The Apex Bank is basking 

in euphoria that its tight 

monetary policy is designed to 

keep macro economic key indicators 

at comfortable zone, 

encourage saving and de—risk 

bank lending to the private 

sector to boost economic expansion. 

Governor Emefiele had 

technically defended the decision 

of the MPC to hold the 

monetary policy rate (MPR) 

at 14 per cent in the last 18 

months. He has an answer 

to why other variables also 

remain fixed, saying: “On 

the argument to hold, the 

committee believes that key 

macroeconomic variables 

have continued to evolve in 

a positive direction in line 

with the current stance of 

macroeconomic policy and 

should be allowed more time 

to fully manifest.” Perhaps, 

this largely accounts for the 

decision of the nine wise men 

to retain the MRR and indeed 

other indicators at the 2017 

level. 

Prior to the MPC’s meeting, 

the President, Chartered 

Institute of Stockbrokers 

(CIS), Mr Oluwaseyi Abe 

had lamented the effect of 

prolonged delay of the meeting 

on the financial market. 

According to him, it has 

made foreign and domestic 

investors to rely on guess 

work about the government’s 

direction on the interest 

rate. Abe’s position which is 

corroborated by one of his 

colleagues on the Institute’s 

Council is justifiable. 

Interest rate affects our 

daily lives and the health of 

any economy. It is a crucial 

macroeconomic variable for 

growth and development. Interest 

rate affects our personal 

lives by guiding us whether 

to consume or save. Investors 

in the financial market have 

waited since late last year 

for the CBN’s position on the 

interest rate to enable them 

adjust their asset allocation. 

Every announcement by 

the MPC has therefore become 

significant as absence 

of policy direction on interest 

rate enthrones speculative 

decision. Against all expec- 

tation and permutations, the 

nine wise men of MPC rose 

from the recent meeting only 

to announce that the interest 

rate and other key indicators 

had been retained. Unconventional 

silence on the 

interest rate will have dire 

consequences on corporate 

growth. 

The Apex Bank can keep 

a high interest rate when an 

economy is doing well. But 

Nigeria’s economy is beginning 

to slow down, hence, 

lower interest rate becomes 

an option to stimulate business 

and employment. At the 

moment, Nigeria is playing 

golf with high interest rate 

and slow growth. This can 

impede economic growth. 

On the stock market, the 

impact of high interest rate is 

obvious. Investors who love 

short time horizon sometimes 

move their funds to bonds 

in order have better yield. 

At a period like this, silence 

of the MPC members on the 

need for downward review 

of interest is not golden. The 

financial market is awaiting 

the Apex Bank’s immediate 

intervention. Unconventional 

silence of the Apex Bank and 

its MPC’s nine wise may be a 

costly gamble. 


comment@businessdayonline.com


12 BUSINESS DAY 

C002D5556 

Editorial 

PUBLISHER/CEO 

Frank Aigbogun 

EDITOR-IN-CHIEF 

Prof. Onwuchekwa Jemie 

EDITOR 

Anthony Osae-Brown 

DEPUTY EDITORS 

John Osadolor, Abuja 

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NEWS EDITOR 

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EXECUTIVE DIRECTOR, 

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John Okpaire 

GM, BUSINESS DEVELOPMENT (North) 

Bashir Ibrahim Hassan 

GM, BUSINESS DEVELOPMENT (South) 

Ignatius Chukwu 

HEAD, HUMAN RESOURCES 

Adeola Obisesan 

Nigeria and ECOWAS 

Perhaps, one of 

the revolutionary 

actions taken 

by Economic 

Community of 

West African States (ECO- 

WAS) since its formation 

in 1975 to foster regional 

integration is the ECOWAS 

protocol on the Free Movement 

of People and Goods. 

The very first of its kind in 

the continent, the free movement 

of goods, capital and 

people was meant principally 

to boost regional trade 

and economic development 

among member states while 

allowing people of the region 

to enter and reside in the territory 

of any member state 

for 90 days at a go, provided 

they have valid travel documents 

and international 

health certificate. 

Although the implementation 

of the protocol hasn’t 

been hassle-free, it has provided 

the peoples and governments 

of the sub-region 

the opportunity to travel 

and trade across their borders 

with little hindrance. 

For Nigerian entrepreneurs 

and businesses, the protocol 

avails them the opportunity 

to explore the markets of 

fourteen other countries. 

For the other member countries, 

Nigeria, with its 185 million 

population (bigger than 

those of the fourteen other 

ECOWAS members), provides 

a huge market for them. Perhaps, 

that is the major reason 

why Morocco, a North African 

Arab country, is applying to 

join ECOWAS. With its fairly 

developed manufacturing 

sector, Morocco stands to 

gain disproportionately from 

free trade with the mainly 

import-dependent West African 

region. But much more 

important to Morocco is the 

benefits of trading freely with 

the over 185 million Nigerian 

market. 

One draw-back of the 

protocol on the Free Movement 

of people, capital and 

goods across the region is the 

predatory actions of Nigerian 

neighbours, who, in wanting 

to access the huge Nigerian 

market, import goods far beyond 

their capacities and 

engage in smuggling across 

Nigerian porous borders. One 

good example is the problem 

of importation and smuggling 

of rice into the Nigerian 

market. The Nigerian government, 

in its bid to ensure selfsufficiency 

in rice production, 

banned the importation of 

rice across the land borders. 

However, as legal importation 

to Nigeria drops drastically, 

importation of parboiled rice 

(consumed mainly by Nigerians) 

increased exponentially 

in the neighbouring countries 

of Benin, Cameroun, Niger 

and others. 

For example, data gathered 

by BusinessDay show that 

Benin Republic with an estimated 

population of 11 million 

people imported 609,893 

metric tonnes of parboiled 

rice from India in 2017, while 

Niger, with an estimated population 

of 21 million people, imported 

98,179 metric tonnes, 

and curiously, Nigeria, with 

a population of 186 million 

imported only 8,726 metric 

tonnes. 

Also, data by the Thai Rice 

Exporters Association shows 

that Benin Republic’s imports 

from Thailand from January 

to November 2017 stood at 

1.64 million metric tonnes, a 

32 percent increase from 1.24 

million metric tonnes within 

the same period in 2016, 

and an increment of 104.45 

percent from 805,765 metric 

tonnes exported to Benin 

republic in 2015. Cameroun 

also imported 663, 667 metric 

tonnes of parboiled rice from 

Thailand between January 

and November 2017, a 47.64 

percent increase from 449, 

513 within the same period 

in 2016, and 449, 297 metric 

tonnes in 2015. 

Of course, from investigation 

and other studies carried 

out, these imported parboiled 

rice all find their way into 

the Nigerian market illegally 

regardless of Nigerian government 

position on importation 

of rice along the land borders. 

While not advocating for 

the termination of the ECOW- 

AS protocol on free movement 

of people, capital and goods 

across the sub-region, we call 

on Nigeria to do more to protect 

its borders to ensure that 

only legitimate goods, services 

and capital flow into the country 

from its neighbours. 

Nigerian businesses, farmers 

and entrepreneurs must also 

do more to plug the huge hole in 

demand that always necessitates 

smuggling and dumping of goods 

from its neighbours. They have 

an unusually huge market – the 

dream of many businesses and 

entrepreneurs in other countries 

– waiting to be captured. They 

must intensify their efforts to ensure 

that they produce goods and 

services to satisfy local demand. 

That alone will give them the 

economy of scale to capture not 

only the West African market, but 

the African market and become 

global players. 

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www.businessdayonline.com


COMPANIES 

& MARKETS 

Company news analysis and insight 

BUSINESS 

DAY 

13 

Dangote Flour Mills, others 

donate N70m threshers to 

wheat farmers 

Pg. 14 

Wapic delivers stronger financial 

performance compares to peers 

BALA AUGIE 

Wapic Insurance 

Plc, 

the top underwriter 

in 

the country, 

has delivered stronger 

financial performance compares 

to peers as it recorded 

double digit growth in premium 

income and profit. 

Wapic Insurance has 

recorded impressive growth 

across key performance indicators 

for the year ended 

December 2017. 

An efficient underwriting 

capacity, the introduction 

of market penetration 

product, channel utilization, 

and capacity building 

help propel the company’s 

earnings. 

For the year ended December 

2017, Wapic insurance’s 

net income surged 

by 161.08 percent to N1.53 

billion, the strongest year on 

year growth among insurers 

that have released full year 

results on the web site of 

the Nigerian Stock Exchange 

(NSE). 

Underwriting profit 

surged by 301.91 percent 

to N1.53 billion in the period 

under review as against 

N380.67 million the previous 

year, which means there is 

enough income after settling 

claims to pay for operating 

expenses and other exceptional 

items. 

Wapic insurance’s solvency 

ratio stood at 285 

percent or 2.85 times in the 

period under review, from 

266 percent or 2.66 times the 

previous year. 

This means that the Nigerian 

insurer’s assets is 

2.85 times the liabilities that 

it holders, which puts it in a 

position to pay claims that 

might be made by customers. 

Different countries use 

different methodologies to 

calculate the solvency ratio, 

and have different require- 

ments. For example, in India 

insurers are required to 

maintain a minimum ratio 

of 1.5. 

Wapic Insurance is good 

financial health and if it is 

paying less claims than it 

receives in revenue as combined 

ratio (CR) fell to 84.09 

percent in the period under 

review from 106.05 percent 

the previous year. 

The combined ratio (CR) 

after policyholder dividends 

ratio,” is a measure of profitability 

used by an insurance 

company to gauge how well 

it is performing in its daily 

operations. 

The combined ratio is 

calculated by taking the 

sum of incurred losses and 

expenses and then dividing 

them. 

A ratio below 100 percent 

indicates that the company 

is making underwriting 

profit, while a ratio above 

100 percent means that it 

is paying out more money 

in claims that it is receiving 

from premiums. 

Wapic Insurance is 

among the NEXT Big 10 

insurers (Zenith, African 

Alliance, FBN Insurance, 

Royal Exchange, Niger, 

Cornerstone, Linkage, and 

NEM) by total assets and 

premium written, which 

makes it a target for big 

global players in the insurance 

market. 

“We highlight that the 

NEXT 10 account for 25 

percent of the market and 

a consolidation of the 1st 6 

(Zenith, African Alliance, 

FBN Insurance, Royal Exchange, 

WAPIC, and Niger) 

of them could lead to the 

emergence of the largest 

insurance company in Nigeria 

by total assets and gross 

premium income, overtaking 

Leadway Assurance,” 

said analysts at Chapel Hill 

Denham in a report. 

Consolidation is increasingly 

becoming inevitable 

because most insurers have 

a very weak capital base that 

has prevented them from 

taking on more risk and 

become competitive on a 

global arena. 

Some foreign investors 

have shown interest in some 

Nigerian firms as they continue 

to hunt for attractive 

assets and stamp their footprint 

across Africa. 

Some of the investors, 

according to him, are AXA, 

Prudential, Liberty, Swiss 

Re, Sunu Group, Saham and 

Allianz, among others. 

Further analysis of Wapic 

Insurance’s financial statement 

shows gross premium 

written, gross premium 

income and net premium 

income spiked by 23.12 percent, 

26.24 percent and 32.02 

percent to N9.80 billion, 

N9.58 billion and N5.65 billion 

in the period under 

review. 

Oando shareholders seek FG’s intervention on technical suspension placed on its shares 

Concerned Shareholders 

of Oando Plc on 

Tuesday urged Federal 

Government to 

prevail on the Nigerian Stock 

Exchange (NSE) and the Securities 

& Exchange Commission 

(SEC) to lift the technical suspension 

placed on the shares 

of the company without any 

further delay. 

The shareholders at a news 

briefing in Lagos said the continued 

suspension of Oando 

shares was sending wrong signals 

to the global community 

about the seriousness of the 

Federal Government in attracting 

foreign direct investments 

to bolster the economy. 

The News Agency of Nigeria 

(NAN) reports that NSE, 

on Oct. 18, 2017, announced 

that it had placed the shares 

of OANDO, a public quoted 

energy company trading on 

the floor of the NSE, on ‘full 

suspension for 48 hours.’ 

The exchange, thereafter 

on Oct. 23, 2017, further announced 

that it had placed 

the shares of the company on 

‘Technical Suspension’. 

The NSE in a letter dated 

Oct. 18, 2017 informed the 

company that the suspension 

of its shares by the NSE was 

done in compliance with a 

directive issued to it by SEC. 

Mr Patrick Ajudua, Head, 

Concerned Shareholders of 

Oando, speaking on reasons 

for the immediate lifting of 

the technical suspension, said 

that the continued suspension 

of the company’s shares could 

also send wrong signals about 

the prevailing operating environment 

in the country. 

Ajudua said that the Federal 

Government must protect 

a prosperous company like 

Oando from going down if it 

wanted to demonstrate to the 

investing world about its seriousness 

to attract investors to 

the country. 

“The continued suspension 

of OANDO PLC is a wrong signal 

to the global market about 

the prevailing harsh operating 

environment in Nigeria, and 

this is at variance with the 

Federal Government’s initiatives 

to diversify the economy 

through increased Foreign 

Direct Investment. 

”We appeal to the Federal 

Government to intervene in 

our travails because the international 

investment community 

is keenly watching. 

”The value of the investment 

we as shareholders of 

Oando have made is being 

eroded because of this continued 

suspension of trading. We 

appeal that this suspension 

order must be lifted now. 

”We, therefore, call on President 

Muhammadu Buhari, 

GCFR; Vice President Yemi 

Osinbajo, GCFR; Senate President, 

Dr. Bukola Saraki, CON; 

Speaker, House of Representatives, 

Rt. Hon. Yakubu Dogara, 

and other well-meaning Nigerians 

to, as a matter of urgency, 

prevail on the NSE and SEC to 

review their position”, he said. 

According to him, the continued 

suspension of Oando 

stock price is not in the best 

interest of the shareholders of 

the Company and investors in 

the capital market. 

Ajudua said that in spite 

of the troubles which the joint 

action of the NSE and SEC had 

subjected Oando, the management 

had continued to show 

the willingness and commitment 

to resolving the issues 

that gave rise to the technical 

suspension of the shares. 

“Management of Oando in 

the spirit of respect and compliance 

with regulatory guidelines 

voluntarily withdrew all legal 

proceedings brought against 

the SEC and the NSE in defending 

its position. 

”This action was taken in 

the best interest of the company’s 

numerous shareholders 

and the nation in particular. 

Even the legal action we as 

shareholders instituted against 

SEC, we have equally withdrawn.

14 

BUSINESS DAY 

COMPANIES & MARKETS 

C002D5556 


Dangote Flour Mills, others donate 

N70m threshers to wheat farmers 

BALA AUGIE 

Dangote Flour 

Mills and other 

flour millers donated 

50 units 

of multi-crop 

thresher machine worth N70 

million to wheat farmers to underpin 

Nigeria’s self-sufficiency 

in wheat production. 

Thabo Mabe, managing 

director/chief executive director 

of Dangote Flour Mills of 

Nigeria, made the disclosure at 

the presentation of the equipment 

in Lagos. 

Mabe said that the new 

machine would help reduce 

costs and improve yields, hence 

increasing the amount of yields 

farmers get per hectare of land. 

He added that the yields would 

go up and costs would come 

down. 

“We are working assiduously 

to ensure that Nigeria 

attains self-sufficiency in wheat 

production. Our company has 

bought about 3000 tonnes of 

wheat from local farmers. We 

need to make sure that we get 

local wheat for bread spaghetti 

and bread” said Mabe. 

Thabo Mabe, chief executive officer, Dangote Flour Mills 

The FMDQ OTC Securities 

and Exchange, 

on Tuesday listed the 

first sovereign Federal 

Government N100 billion Sukuk 

bond aimed at tackling 

infrastructure development on 

its platform. 

Patience Oniha, the Director-General, 

Debt Management 

Office (DMO) said at the listing 

programme in Lagos. 

She said the seven-year 

bond at 16.47 per cent due by 

2024, was packaged on behalf 

of the government by DMO and 

the Ministry of Finance. 

Oniha said the bond was 

issued to develop and enhance 

quality of life and business activities 

in the country. 

“The DMO in pursuit of 

its objectives to diversify the 

sources of government funding 

and deepen the domestic capital 

market, successfully issued the 

debut N100 billion seven-year 

Sovereign Sukuk on Sept. 26, 

2017.’’ 

She said the proceeds of the 

issuance of the Sukuk would 

be used to construct and rehabilitate 

ear-marked roads across 

the six geopolitical zones of the 

country. 

According to her, the purpose 

of the Sukuk is to integrate 

ethical investors into the domestic 

securities market. 

She said the bond was floated 

to establish a benchmark 

for pricing of Sukuk by other 

domestic issuers and offer investors 

the opportunity to earn 

returns, while contributing to 

the infrastructure development 

John Coumantaros, the 

Chairman, Flour Milling Association 

of Nigeria (FMAN), 

represented by Paul Gbededo, 

Group Managing Director, 

Flour Mills Nigeria Ltd., said 

that the presentation was a 

demonstration of the association’s 

commitment to continuously 

support wheat farmers 

and Federal Government’s 

agriculture promotion agenda. 

“There is no gainsaying that 

self-sufficiency in the production 

of wheat in Nigeria will 

have an unprecedented impact 

on the Nigerian economy 

through attainment of food 

security, poverty reduction and 

of course, save much needed 

foreign exchange,” he said. 

Coumantaros said that the 

association signed an MoU 

with Wheat Farmers Association 

of Nigeria in 2016 to purchase 

all available wheat grain 

produced by farmers in line 

with agreed quality parameters 

and prevailing market prices. 

“In 2017, FMAN fulfilled its 

promise by purchasing over 

2,400 metric tons of wheat 

valued at N469 million. 

“In 2018, even before the 

start of harvest, we have purchased 

over 1600 metric tons of 

wheat valued at N237 million. 

“FMAN established a N20 

million Researches and Development 

Grant to the Lake Chad 

Research Institute to conduct 

research into enhanced wheat 

farming technology and modern 

agronomy practices aimed 

at improving wheat varieties 

with good yield,” he said. 

Coumantaros said that the 

association would continue to 

invest effort and resources on 

initiatives that would improve 

local supply chain. 

He said that it would also 

ensure access to quality wheat 

at decent price and ensure that 

bakers and confectioners were 

not burdened. 

Also, Rotimi Fadipe, a representative 

of Honeywell Flour 

Mills, said that the local production 

of wheat had increased 

to about one million metric 

tons. 

Fadipe said the association 

expected double yields with 

the equipment presented to 

the farmers, adding that the 

initiative would be sustained. 

According to him, Kano, 

Jigawa, Kebbi and Katsina 

States will each receive eight 

units of the multi-crop threshers, 

while Sokoto, Bauchi, Kaduna 

and Zamfara States will 

receive four units each. 

He said that the remaining 

two units would be kept at the 

national office of the wheat 

farmers association for intervention 

purposes. 

In his remarks, Salim Mohammed, 

the National President, 

Wheat Farmers Association 

of Nigeria, commended 

the flour millers for their gesture 

toward boosting wheat 

production. 

Mohammed said that the 

equipment would be judiciously 

utilised to boost wheat 

production and reduce cost of 

FMDQ lists FG’s N100bn sovereign Sukuk 

bond for infrastructure development 

of the country. 

Oniha said the proceeds 

were being deployed for the 

construction and rehabilitation 

of 25 key economic roads 

projects across Nigeria’s six 

geopolitical zones. 

“The listing of the sovereign 

Sukuk on FMDQ will 

provide investors with the 

much needed transparent 

and efficient platform for 

price determination and liquidity,” 

she said. 

Oniha said the Sukuk Bond 

was an infrastructure bond, noting 

that people that invested in 

the bond, invested for the future. 

She stated that the bond was 

initiated to boost the financial 

inclusion programme of the 

government to reach out to the 

unbanked people. 

Business Event 

L-R: Kunle Ahmed, chief executive officer; Omowunmi Mabel-Adewusi, general counsel/HR director; 

Abisola Nwoboshi, group head, corporate business and Akinlolu Akinyele, group head, energy 

and special risks, all of AXA Mansard Insurance plc after receiving award for most innovative 

deployment of HR strategy in Lagos 

L-R: Patrick Akpareva, regional service head, Lagos of First City Monument Bank (FCMB); Tajudeen 

Nurudeen, deputy rector, academics, Lagos State Polytechnic (LASPOTECH); Ola Olateju, deputy 

rector, administration; Samuel Sogunro, rector; Oliver Opara, regional head, Lagos of FCMB, and 

Bukola Smith, executive director, business development of the bank, during the commissioning 

ceremony of the LASPOTECH gate reconstructed by FCMB as part of the activities of the opening 

of the Bank’s Flexx Hub at the school in Ikorodu, Lagos. 

L-R: Gloria Archibong, Acting Ogun State Co-ordinator, World Health Organisation (WHO); Nofiu 

Aigoro, Permanent Secretary, Ogun State Ministry of Health; Babatunde Ipaye, Commissioner for 

Health, Ogun State, and Omotayo Omoteso, representing, Nestlé Nutrition Institute Africa (NNIA), 

at a press conference to celebrate the 2018 World Health Day, in Abeokuta. 

L-R: Patrick Ajudua, member, New Dimension Shareholders Association; Badmus Tunde, chairman, 

Pacesetters Shareholders Association Inc., and Oguntoye Lawrence, member, District Shareholders 

Association at the media briefing by concerned shareholders of Oando Plc calling for the lifting of 

the suspension of Oando stocks by the Nigeria Stock Exchange in Ikeja, Lagos.


BUSINESS DAY 

15 

CITYFile 

Collapsed Reigners Church building: 

‘No one will escape justice’ 

ANIEFIOK UDONQUAK, Uyo 

Families who lost their loved 

ones in the collapsed Reigners’ 

Bible Church building, in Uyo, 

Akwa Ibom State capital, have 

been assured that those whose 

negligence and unprofessional roles led 

to the unfortunate incident would face 

the full weight of the law. 

The church building collapsed in 

December 2016 killing 30 people and 

leaving several others, mostly worshipers, 

injured. 

Uwemedimo Nwoko, attorney general 

and commissioner for justice, Akwa Ibom 

State, gave the assurance following the 

release of the white paper on the incident 

by the state government. 

Speaking in Uyo on Tuesday, Nwoko 

said those found culpable from the investigation 

will not go scot free. He promised 

to liaise with the police in the state to 

ensure a thorough investigation of those 

indicted by the report of the commission 

of enquiry to ensure that justice is done 

in the case. 

Nwoko appealed to the people to 

remain calm and patient as the state government 

would do all within its powers to 

ensure that everyone indicted is properly 

investigated and charged to court. 

“All those who have been indicted by 

the report will be subjected to a thorough 

investigation by the police and 

any found culpable will be charged to 

court and made to face the full weight 

of the law”. 

“No one has been exonerated, but we 

have to carry out proper investigation, you 

cannot just jail anyone, we must follow 

due process, but trust that justice must 

be done at the end of the day”. 

Meanwhile, Dominic Ukpong, the 

commissioner for health says the government 

has taken steps to forestall a repeat 

of such magnitude of disaster in the state 

with the establishment of emergency 

health centres with trained personnel. 

Ukpong said as further indication of 

commitment to the welfare of victims of 

the collapsed Church Building, the Akwa 

Police arrest herder with charms in Edo 

IDRIS UMAR MOMOH, Benin 

The police in Edo say they have arrested 

a herder suspected to be 

involved in kidnapping, and recovered 

some charms from him. 

Johnson Babarunde Kokumo, Commissioner 

of Police in Edo, who paraded 

the suspect alongside 27 others, said 

that the herder was arrested by officers 

of the Auchi divisional headquarters 

on April 9. Kokumo said the suspect, 

simply identified as Abubakar Ilyasu, 

aged 30, was arrested following the kidnapped 

of a farmer identified as Idirisu 

Mohammed at Ivbiaro/Afuze junction 

in Owan East local government area. 

He said the kidnapped victim was 

however rescue unhurt while other 

suspects escaped. 

“On April 9, 2018 at about 1700 hours 

the police at Auchi embarked on bush 

Commissioner of Police, Johnson Kokumo pointing to the victims of kidnappers rescued 

unhurt by the Police during the parade of suspected armed robbers, kidnappers and Fulani 

herdsmen at the Command headquarters, Benin City. 

Ibom State government recently spent a 

total of N300 million as medical bills for 

victims of the building collapse. 

combing exercise following a report of 

the kidnap of a farmer at Ivbiaro/Afuze 

junction by kidnappers. 

“In the process, the victim, named 

Idirisu Mohammad (m) was rescued unhurt, 

one of the kidnappers later identified 

as Abubakar Ilyasu (m) and aged 30, 

Fulani herder was arrested while others 

escaped. Some charms were recovered 

from him”, he said. 

He said that efforts were ongoing to 

arrest the other fleeing suspects and 

recover their arms. 

The commissioner said that kidnappers 

who disguised as herders were also 

arrested in the bush in Afuze area of 

Owan East local government area and 

taken to Ekpoma divisional headquarters 

by the Inspector-General of Police intelligence 

response team. 

He said the suspects named Mirtala 

Umoru (m) and Rabiu Udu (m) were 

He said that a total of 168 victims were 

evacuated from the scene of the incident 

out of which 30 worshipers lost their lives. 

arrested on April 9, 2018 while one AK- 

47 rifle with breech number K0340119 

and ten rounds of 7.62mm ammunition 

were recovered from them. The CP said 

that the suspects having confessed to the 

crime have been transferred to the police 

headquarters. 

He also paraded three other suspects 

in connection with the murder of Pius 

Eromonsele, a pastor in the Church of 

God Mission, Benin. 

He said that one of the suspects, Tahiru 

Usman (m) was arrested following 

the cooperation of two others earlier 

arrested. 

The CP explained that 11 other suspects 

were arrested in connection with 

armed robbery, seven for cultism while 

ten guns, 15 live ammunition, 32 assorted 

phones, two cars, the sum of N19,040 

and many other items recovered from 

them were also displayed at the event. 

Police recover 

168 guns, others 

in Imo 

Commissioner of Police in Imo, 

Chris Ezike, says the command 

has recovered 168 guns and 2,323 

ammunition during its mop-up of armaments 

in the state. 

Ezike, who made the disclosure in 

Owerri while displaying the weapons, 

said they were recovered from criminals 

and some individuals who surrendered 

their own voluntarily. 

The command, according to the police 

chief, also recovered 99 cartridges and 25 

empty magazines. 

Ezike said that the action was in compliance 

to the Inspector General of Police 

directive to state police commands to 

deposit all mop-up and surrendered arms 

and ammunition to the public armory. 

He said that those arrested in connection 

with the weapons that were not 

voluntarily made, are facing various 

charges in court. 

He explained that the arms recovery 

had become a proactive exercise aimed 

at checking the activities of would-be 

political thugs, adding that the mop-up 

and voluntary submission of weapons 

had led to reduction in criminality such 

as kidnapping and armed robbery in the 

state. 

He assured that anybody who willingly 

surrendered weapons in his custody 

within the time frame stipulated by the 

IG would have police protection. (NAN) 

Kano LG to 

immunise 

181,129 children 

Kumbotso local government 

council in Kano says about 

181,129 children have are targeted 

for immunisation this month. 

Nasir Gwarzo, head, department of 

health in the council, disclosed this 

at Kumbotso. He said that the council 

was optimistic of meeting the target as 

143,170 had already been immunised 

in the ongoing exercise. 

According to him, the council has 

also received 200,000 vaccines for the 

April round of the immunisation exercise. 

Gwarzo said tremendous success has 

been recorded in the exercise amidst 

minor challenges. 

He commended traditional rulers 

in the area for timely resolution of issues 

related to non-compliance and 

missed children. The official however 

assured that missed children would be 

targeted and incorporated in the mop 

up exercise. 

Kano State is generally targeting 3.2 

million children below the age of five 

for immunisation in 2018.


C002D5556 


Investor 

In association with 

Helping you to build wealth & make wise decisions 

NSE All Share Index Market capitalisation 

NSE Premium Index The NSE-Main Board NSE ASeM Index NSE 30 Index NSE Banking Index NSE Insurance Index NSE Consumer Goods Index NSE Oil/Gas Index 

Year Open 38,243.19 N13.609 trillion 2,564.13 1,713.69 1,087.32 1,746.68 475.44 139.37 976.10 330.69 

Week open (29 – 03–18) 41,504.51 N14.993 trillion 2,950.23 1,794.38 988.53 1,874.27 520.57 151.09 978.14 346.91 

Week close (06 – 04–18) 40,841.14 N14.753 trillion 2,907.24 1,779.28 978.72 1,846.47 513.67 150.98 967.61 337.31 

Percentage change (WoW) -1.60 

-1.46 

-0.84 -0.99 

-1.48 -1.33 -0.07 -1.08 -2.77 

Percentage change (YTD) 6.79 13.38 

3.83 -9.99 5.71 

8.04 8.33 -0.87 2.00 

Analysts see upside potentials as market 

creates attractive entry opportunities 

HEANYI NWACHUKWU 

While many stock 

investors wonder 

if there is still any 

room for upside in 

this second-quarter 

(Q2) 2018, analysts say the recent dip 

seen in the market creates attractive 

entry opportunities in value stocks. 

The Nigerian Stock Exchange (NSE) 

All-Share Index (ASI) depreciated by 

1.60percent last week to 40,841.14 

points while and Market Capitalisation 

declined to N14.753 trillion. 

While stock investors showed less 

interest in equities, only 19 equities 

appreciated in price in the trading 

week ended April 6, lower than 40 

in the preceding week; 53 equities 

depreciated in price, higher than 40 

equities in the preceding week, while 

99 equities remained unchanged, 

higher than 91 equities recorded in the 

preceding week. 

Though the market opened this 

week on a negative note after a record 

N150billion loss on Monday, Afrinvest 

research analysts maintain their 

positive near-term outlook as investors 

hunt for bargain opportunities. 

“We believe the current negative 

performance of the market is a 

correction to the bullish run witnessed 

in the first two months of the year. The 

weak sentiment also reflects some 

negative earnings surprises in the 

earnings season as well as slowdown in 

portfolio flows into the equity market,” 

the analysts said. 

They further noted that the 

extended selloff “has, however, created 

attractive entry opportunities in large 

and medium cap stocks with strong 

fundamentals”. 

The local equities market in the 

trading week to April 6 extended the 

3-week consecutive downtrend as the 

All Share Index declined 1.6perxcent 

week-on-week (WoW) to 40,841.14 

points while year-to-date (YtD) returns 

moderated to 6.8percent. 

GTI research analysts in their 

outlook for the month of April 2018 

expect positive economic environment 

to dictate major activities in the month. 

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. 

“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. 

For United Capital, they believe 

there is still room for further upside 

“given that the benchmark index 

currently trades below our base case 

return of 12.4percent for the year.” 

“Sentiments will be largely driven 

by first-half (H1) 2018 earnings 

scorecards, continued improvement 

in the broader economy and a lower 

yield environment,” United Capital 

analysts added in their most recent 

daily insight. 

On the outlook for equities in 

second-quarter (Q2) 2018, United 

Capital said “2018 started out on a 

bullish note, extending the prior year’s 

bullish sentiments amid optimism in 

the broader economy and strong full 

year (FY) 2017 earnings expectation.” 

“The NSEASI recorded a massive 

16percent return in January 2018 

alone but corrected 2.3percent monthon-month 

(m/m) and 4.2percent 

m/m in February 2018 and March 

2018 notwithstanding the sustained 

improvement in the broader economy. 

The FY-17 corporate scorecards also 

impressed. Overall, the NSEASI rallied 

8.5percent quarter-on-quarter (q/q) in 

Q1-18, spurred by the January rally,” 

United Capital stated. 

NSE Lotus II 

2,560.39 

2,698.99 

2,660.85 

-1.41 

3.92 

NSE Ind. Goods Index 

1,975.59 

2,192.12 

2,146.20 

-2.09 

8.64 

NSE Pension Index 

1,379.74 

1,584.56 

1,571.86 

-0.80 

13.92 

Deal makers appetite dampen 

on political risks 

The political risk 

will remain a 

major concern for 

dealmakers in Africa 

in 2018, according to a recent 

report, Resourceful dealmaking: 

Outlook for Mergers & 

Acquisition (M&A) in Africa. 

The report published by 

Mergermarket in collaboration 

with specialist risk consultancy 

Control Risks notes that there 

has been a dramatic fall in 

M&A activity, with declines 

of 25percent in volume and 

26percent in value in the first 

half of 2017, compared with a 

relatively buoyant 2016. 

The drop-off signifies growing 

investor anxiety surrounding 

governance issues and weaker 

economic signals across key 

African markets, according to 

Imad Mesdoua, senior political 

risk consultant at Control Risks. 

“Political risk will continue 

to pose a major challenge to 

M&A activity on the continent 

as several large markets such 

as Nigeria undertake difficult 

elections and unpopular 

reforms to improve their 

economic outlooks. The 

political uncertainty and weak 

macroeconomic situation that 

accounted for fewer deals in 

Africa’s largest markets in 2017 

look set to ease over the coming 

year as countries such as South 

Africa, Zimbabwe and Angola 

begin to stabilise,” Mesdoua 

noted. 

“Specifically, political risk 

and transparency concerns have 

become the principal obstacles 

to successful acquisition in 

Africa. Ethical and compliance 

considerations are another 

major factor clouding the 

outlook for potential investors,” 

Mesdoua added. 

The report found that political 

uncertainty and relatively weak 

economic fundamentals have 

negatively affected M&A activity 

in Africa. A fall-off in deals was 

seen in the first half of 2017 

compared with a relatively 

buoyant 2016. 

Political risk will be a 

major obstacle to dealmaking 

in Africa over the next 12 

months, according to 84% 

of respondents. Other risk 

factors include transparency 

concerns and completeness 

of information, which ranked 

joint first alongside political 

risk (84percent), as well as 

compliance and integrity issues 

(80percent). 

Almost three-quarters 

(72percent) of respondents 

say that getting caught up 

in a regulatory or criminal 

investigation is one of the 

highest risks in relation to a 

target company’s ethics and 

compliance standards. 

Good news though for South 

Africa, Zimbabwe and Angola: 

greater political stability and 

a more favourable economic 

and business environment are 

expected to boost M&A activity 

in the coming year. 72percent 

of respondents are pursuing coinvestment 

strategies in Africa 

as a means of allocating risk 

more effectively.


C002D5556 

BUSINESS DAY 

Investor 


17 

United Capital investment views 

Bears play first fiddle 

…as equities reverse previous week’s gains 

Local equities reverse 

previous week’s gains, as 

MPC holds policy rates 

Domestic equities 

started the new 

month on a bearish footing, 

after reversing gains recorded 

in the previous week to close 

40,814.1points upon shedding 

1.6percent week-on-week 

(w/w). The bearish sentiment 

was profound in the holidayshortened 

week as the market 

closed in the red three of the 

four trading days. Thus, market 

capitalization lost N239.6billion 

to N14.8tillion while Year-to- 

Date (YtD) return dived to 

6.8percent. 

Performance across sector 

indices was broadly bearish 

as all indices declined w/w, 

led by the Industrial Goods 

(-2percent) index consequent 

on sell-offs in WAPCO 

(-2.4percent) and DANGCEM 

(-2percent). The Oil & Gas 

(-1.8percent) and Financial 

Services (-1.2percent) index 

trended southwards on account 

of TOTAL (-4.9percent), MOBIL 

(-8.5percent), FO (-4.8percent), 

WEMA (-14.1percent) and 

ZENITH (-6.8percent). The 

Consumer Goods (-0.2percent) 

and Agriculture (-1bps) indices 

trailed along owing to declines 

in DANGFLOUR (-13.5percent), 

INTBREW (-9.7percent) and 

LIVESTOCK (-1.1percent). 

Investor sentiment as 

measured by market breadth 

declined to 0.4x (formerly 

1.0x) indicating the bearish 

theme that prevailed during the 

week. However, activity levels 

remained upbeat as average 

volumes traded advanced 

14.5percent w/w to 441.2mn 

units while average value traded 

leaped 59.6percent to close at 

N6.6bn. We expect bargain 

hunting on stocks trading at 

a relatively low price to guide 

investors’ sentiment. 

Money Market: Liquidity 

deluge crushes rates to 2018- 

lows 

The money market was 

awash with cash in the week 

ending 6th April 2018 as 

money market rates averaged 

3.9percent compared to 

20.7percent in the preceding 

week. The weeks’ liquidity 

profile was kept afloat by 

OMO maturities to the tune of 

N528.9bn, as well as an absence 

of any significant funding 

pressure. All-inclusively, 

money market rates declined 

on a weekly basis; OBB (down 

4.1percent to 4percent) and 

O/N (down 3.5percent to 

3.7percent) w/w. 

On Wednesday, the Apex 

bank conducted its bi-monthly 

Nigerian Treasury Bill (NTB) 

auction, wherein it successfully 

re-financed N95.2bn. Demand 

was robust with a bid-to-cover 

ratio of 2.1x compared to 

1.5x in the previous auction. 

Notably, the 364-day tenor 

was mostly demanded (with a 

bid-cover of 4.6x compared to 

the 91-day and 182-day tenors, 

where demand was relatively 

slimmer with a bid-cover of 

1.0x and 0.4x respectively. The 

auction was carried out at the 

following stop rates: 91-day 

(11.75percent vs. 11.95percent 

at the last auction), 182-day 

(12.7percent vs. 13percent at 

the last auction) and 364-day 

(13percent vs. 13.15percent 

at the last auction). In terms 

of liquidity profile, N476.2bn 

OMO maturities are expected 

to hit the system this week, 

however, we expect rates to 

inch higher considering FX 

Secondary Market Intervention 

Sales (SMIS) expected on 

Monday as well as other 

probable mopping-up activities 

by the CBN. 

Yields: FI players ply into 

the market amid boisterous 

system liquidity 

Sentiment in the fixed 

income space was broadly 

the domestic currency saw a 

fractional increase 2bps and 

5bps in official market and 

the Investors and Exporters 

Foreign Exchange window to 

settle at and N305.6/$1 and 

N360.0/$1 respectively. The 

outlook of the naira is expected 

to remain tied to the spate of 

CBN’s intervention in the spot 

and forward market. 

Global equities mixed as 

trade war fears intensify 

Equity indices across the 

globe closed the week that 

ended 6th April 2018 mixed. 

In the U.S market, major 

indices reversed previous 

week’s gains as fear of trade 

war erupting between U.S. and 

China intensified. China in a 

retaliatory move announced 

tariffs on about 130 U.S. goods, 

including a 25percent penalty 

on U.S. pork and 15percent on 

fruit while the U.S. proposed 

additional tariffs on $100 billion 

of Chinese goods on top of 

RSA fund price of PFAs as at April 6, 2018 

S/N PFAs CURRENT PRICE 

1 CrusaderSterling Pensions 3.9187 

2 Premium Pensions 3.8462 

3 ARM Pension Mgrs. 3.8245 

4 Stanbic-IBTC Pensions 3.6868 

5 Legacy PFA 3.5444 

6 NLPC PFA 3.3622 

7 PAL Pensions 3.3614 

8 First Guarantee Pension 3.2198 

9 Trustfund Pensions 3.2007 

10 Leadway Pensure PFA 3.0821 

11 SigmaVaughn Pensions 3.0725 

12 AIICO Pension Managers 2.9762 

13 APT Pensions 2.7649 

14 Fidelity Pensions 2.6690 

15 AXA Mansard 2.6382 

16 FUG Pensions 2.5898 

17 OAK Pensions 2.4913 

18 Investment One Pension Mgrs. 2.4119 

19 IEI Anchor Pension Managers 2.2899 

20 Radix Pension 1.9916 

21 NPF Pensions 1.4372 

bullish, representing an 

ease-off from the previous 

weeks’ bearishness that was 

characterized by liquidity 

strains. Furthermore, sentiment 

was guided by spill-over 

demand from the PMA auction 

and liquidity dynamics. Overall, 

average T-bill yield shed 72 

basis points (bps) w/w to close 

the week at 14.2percent; 91-day 

(down 173bps to 12.9percent), 

182-day (down 37bps to 

14.5percent) and the 364-day 

(down 5bps to 15.1percent). 

In a similar theme, the bulls 

were at the helm of the bonds 

market, as average bonds yield 

fell by 5bps to end the week at 

13.7percent, driven by bargainhunting 

in the 3-year and 10- 

year maturities (where yields fell 

16bps and 11bps respectively). 

Looking ahead, we expect 

fixed income yields to track the 

trajectory of system liquidity. 

Currency Market: Naira 

remains constant in the 

parallel market 

In line with its recurrent 

trend, the naira traded sideways 

in the parallel market to close the 

week at N361/$1. Nevertheless, 

the $50bn outlined earlier 

in the week. Consequently, 

NASDAQ (-2.1percent), 

S&P 500 (-1.4percent) and 

DJIA (-0.7percent) trended 

southwards w/w. 

In Europe, equity indices 

weathered a volatile week 

to log back-to-back weekly 

gains. With the trade tensions 

between U.S. and China in the 

background; European Union’s 

statistics agency, Eurostat, 

said unemployment in the 

19 Eurozone countries fell to 

8.5percent in February from 8.6% 

in January, its lowest level since 

December 2008. Accordingly, 

UK’s FTSE (+1.8percent), 

France’s CAC ((+1.8percent), 

Germany’s DAX (+1.2percent) 

and Pan-European STOXX 600 

(+1.1percent) indices closed the 

week higher. 

Emerging market indices 

closed the week mixed. India’s 

BSE (+2percent) and South 

Africa’s JALSH (+0.7percent) 

advanced w/w while Brazil’s 

IBOV (-1.6percent), China’s 

SCHOMP (-0.9percent) and 

Russia’s RTSI (-0.8percent) 

declined w/w. 

Investor’s Square 

•Have you been shabbily treated by your registrar, 

stockbroke r or other capital market operators? 

Let us know and investor will help you investigate and 

report back. 

E-mail: iheanyi.nwachukwu@businessdayonline.com 

Subscription opens for FGN 

savings bonds offer 

…at 10.75%, 11.75% coupon rates 

IHEANYI NWACHUKWU 

The Debt 

Management 

Office (DMO) 

on behalf of the 

Federal Government 

of Nigeria (FGN) has 

started offering Savings 

Bond for this month of 

April. 

The subscription 

for the five-day offer 

opened on Monday 

April 9, 2018, with a 

minimum subscription 

of N5, 000 and 

maximum subscription 

of N50million and 

closes by 12 noon on 

Friday April 13, 2018. 

FGN Savings 

Bond is a scrip-less 

security with allotment 

done electronically 

into investor’s 

CSCS account; and 

investors will receive 

notifications. The 

Savings Bond is backed 

by the full faith and 

credit of the Federal 

Government of Nigeria 

and charged upon 

the general assets of 

Nigeria. 

Early this year 

(January 25), the Debt 

Management Office 

updated list and contact 

details of its accredited 

distribution agents to 

market FGN Savings 

Bond. The Agents are 

currently 135 in number, 

according to DMO list. 

The Central Bank of 

Nigeria is the Registrar 

and Settlement Agent 

for FGN Savings Bond; 

while Central Securities 

Clearing System Plc 

(CSCS) plays the 

Custody, Clearing and 

Settlement roles. 

The 2-Year FGN 

Savings Bond due April 

18, 2020 is currently 

being offered at a 

coupon rate of 10.75 

percent per annum; 

while the 3-Year FGN 

Savings Bond due April 

18, 2021 is also offered 

at a coupon rate of 11.75 

percent per annum. 

Coupon will be paid 

quarterly and bullet 

principal payment 

on maturity - directly 

into investors’ bank 

account. The coupon 

rate is the rate of interest 

paid by the bond issuer 

(Debt Management 

Office on behalf of 

Federal Government of 

Nigeria) on the bond’s 

face value. 

FGN Savings Bond 

is an investment 

vehicle offered by the 

Sovereign that serves 

to meet the investment 

needs of low-high 

income citizens in the 

economy by enhancing 

their savings culture 

while also acting 

as an efficient debt 

management tool for 

the Nigerian Treasury. 

It is of immense 

benefit to individual 

savers, small businesses, 

co-operatives, 

foundations, nonprofit 

organisations, and other 

investors subject to 

the maximum limit of 

N50million. Nigerian 

Citizens resident abroad 

and foreigners resident 

in Nigeria are eligible. 

Every month, the 

Federal Government 

issues Savings Bond to 

deepen the national 

savings culture; provide 

opportunity to all 

citizens, irrespective 

of income level to 

contribute to national 

development; enable 

all citizens participate 

in and benefit from 

the favourable 

returns available in 

the Nigerian Capital 

Market; and diversify 

funding sources for the 

Government.



C002D5556 

Investor 


Access, Lafarge, Seplat, UBA to 

migrate to NSE Premium Board 

IHEANYI NWACHUKWU 

The Nigerian 

S t o c k 

Exchange 

(NSE) will 

on Monday 

April 16 migrate Access 

Bank Plc, Lafarge Africa 

Plc, Seplat Petroleum 

Development Company 

Plc and United Bank for 

Africa Plcto the Premium 

Board. 

The admission of 

these companies to 

the Premium Board 

listing segment for the 

elite group of issuers 

implies that they have 

met the Exchange’s most 

stringent corporate 

governance and listing 

standards. 

They will be joining the 

likes of Dangote Cement 

Plc, FBN Holdings Plc, 

and Zenith International 

Bank Plc already on the 

Premium Board. 

The Board is a 

platform for showcasing 

companies who are 

industry leaders in their 

sectors. Premium Board 

features companies that 

adhere to international 

best practices on 

corporate governance 

and meet the Exchange’s 

highest standards of 

capitalisation and 

liquidity. 

FMDQ Learning 

Access Bank Plc 

currently has a market 

capitalization in excess 

of N347.135billion with 

shares outstanding of 

28.927billion units. The 

share price stood at N12 

as at April 10, 2018. 

Lafarge Africa Plc with 

share price at N41 as 

at April 10, 2018 has a 

market capitalisation in 

excess of N355.610billion 

and shares outstanding 

of 8.673billion units. 

Seplat Petroleum 

Development Company 

Plc priced at N665.1 as 

at April 10, 2018 is valued 

at N391.374billion on the 

Nigerian bourse, with 

outstanding shares of 

588.44million units. 

The equity value of 

United Bank for Africa 

Plc is N405.263billion 

at N11.85per share as at 

Tuesday April 10, 2018. 

The bank’s outstanding 

shares are 34.199billion 

units. 

A Premium Board 

listing gives a company 

access to a global pool 

of investors who are 

focused on companies 

managed in conformity 

to the highest standards 

in their target markets. 

The NSE requires 

that companies seeking 

admission to its Premium 

Board should satisfy one 

set of Listing Standards 

for the NSE Main Board, 

as well as comply 

with the following: 

meet the minimum 

market capitalisation 

requirement of N200 

billion on the date The 

Exchange receives its 

application (or at the 

time of listing – for new 

listings). 

Also, the company 

must be evaluated under 

the NSE’s Corporate 

Governance Rating 

System (CGRS) and 

achieve a minimum 

rating score of 70percent. 

The company must 

satisfy either: a minimum 

free float requirement of 

20percent of its issued 

share capital, or the value 

of its free float shares 

is equal to or above 

N40billion on the date 

the Exchange receives its 

application to list. 

Deal makers appetite 

dampen on political risks 

Shareholders seek 

FG intervention on 

Oando’s technical 

suspension 

A group of Concerned 

Shareholders of Oando 

Plc called on President 

Muhammadu Buhari; Vice 

President Yemi Osinbajo; 

Senate President Bukola 

Saraki; Speaker, House of 

Representatives, Yakubu 

Dogara and other well 

meaning Nigerians to 

prevail on the Nigerian 

Stock Exchange (NSE) and 

the Securities & Exchange 

Commission (SEC) to lift the 

technical suspension placed 

on the shares of Oando 

without any further delay. 

Speaking at a press briefing 

on Tuesday, April 10, 2018, in 

Lagos, the shareholders said 

the continued suspension of 

Oando shares was sending 

wrong signals to the global 

community about the 

seriousness of the Federal 

Government in attracting 

foreign direct investments to 

bolster the economy. 

It will be recalled that the 

Nigerian Stock Exchange 

(NSE) on 18th October 2017 

announced that it had placed 

the shares of OANDO Plc, 

a public quoted energy 

company trading on the floor 

of the NSE, on ‘full suspension 

for 48 hours.’ Thereafter on 

23rd October 2017, the NSE 

further announced that it 

had placed the shares of 

the Company on ‘Technical 

Suspension’. The NSE by a 

letter dated 18th October 2017 

informed Oando PLC that the 

suspension of its shares by the 

NSE was done in compliance 

with a directive issued to it 

by the Securities & Exchange 

Commission (SEC). 

The head of the 

Concerned Shareholders 

of Oando, Patrick Ajudua, 

while advancing reasons 

for the immediate lifting of 

the Technical Suspension, 

noted that the continued 

suspension of Oando shares 

could also send wrong signals 

about the prevailing harsh 

operating environment in 

the country. He also stressed 

that the Federal Government 

must protect a prosperous 

company like Oando from 

going down if it wanted to 

demonstrate to the investing 

world about its seriousness 

to attract investors to the 

country. 

According to him: “the 

continued suspension 

of OANDO Plc is a wrong 

signal to the global market 

about the prevailing harsh 

operating environment 

in Nigeria, and this is at 

variance with the Federal 

Government’s initiatives 

to diversify the economy 

through increased Foreign 

Direct Investment. We appeal 

to the Federal Government 

to intervene in our travails 

because the International 

investment community is 

keenly watching. The value 

of the investment we as 

shareholders of Oando have 

made is being eroded because 

of this continued suspension 

of trading. We appeal that this 

suspension order must be 

Introduction to Securitisation (2) 

Continued from last week 

Benefits of 

Securitisation 

From providing 

funding and 

cash flow 

requirements 

to deepening 

the capital markets, 

securitization offers 

diverse benefits to the 

originators, investors 

and the capital markets 

as a whole. 

Some of these 

include, but are not 

limited to the following: 

To the originator, 

securitisation offers 

cash flow and balance 

sheet management 

benefits. It can be used 

to improve balance 

sheet liquidity by 

converting long-term 

and illiquid receivables 

into funds that can 

be used for valuegenerating 

investments. 

Furthermore, it can 

be used to diversify 

funding sources 

and reduce the cost 

of the originator’s 

borrowings. In addition, 

securitisation offers 

a useful mechanism 

by which originators 

transfer risks associated 

with their loan 

portfolios to parties 

that are more willing or 

able to manage them. 

This is achieved through 

the transforming of 

cash flows and risks of 

the collateral pool into 

those of the securities 

issued on the pool. 

To the investor, 

securitisation provides 

an investible asset 

class which could 

offer attractive yields. 

Securitised assets can 

also be tailored in a 

manner that meets the 

investor’s unique needs 

and risk appetite. 

To the capital 

markets, securitisation 

contributes to market 

depth and liquidity, and 

offers price discovery to 

relatively illiquid assets, 

as well as facilitates 

greater access to funds 

for new firms or firms 

with low credit ratings. 

Risk Considerations 

Whilst securitisation 

can provide benefits 

to capital market 

participants and 

associated stakeholders, 

it also creates unique 

risks which can 

lead to unintended 

consequences. 

Cash flow risk: 

This is the possibility 

of poor cash inflows 

from the pooled assets, 

threatening investors’ 

ability to recover 

the value of their 

investments. 

Amortisation risk: 

This emanates from 

a potential mismatch 

between cash flow 

receipts on the 

receivables (pooled 

assets) and cash outflow 

payments on the 

securities. For example, 

in a scenario where 

a long-term security 

is collateralised by 

short-term credit card 

receivables, the security 

will almost certainly be 

exposed to amortisation 

risk. Securitisation 

requires detailed risk 

management structures 

to ensure that the 

inherent risks are 

properly understood 

and managed. In 

addition to ensuring 

that the securitised 

products are of good 

credit rating, investors 

are expected to adopt a 

robust forward-looking 

analysis that considers 

the fundamental 

characteristics of the 

underlying assets 

and captures the 

interplay between 

economic factors, 

collateral performance 

and legal structure 

of the transaction to 

measure identified risks 

effectively. 

Securitisation, as an 

asset class, presents an 

interesting opportunity 

for the Nigerian DCM, 

promoting diversity 

of investment assets 

and supporting the 

deepening of the 

Nigerian financial 

markets. 

The next edition in 

this series will delve 

into the fundamentals of 

ABS and MBS.


19

20 

BUSINESS DAY 

C002D5556 

Thursday 12 April 2018


21

BUSINESS DAY C002D5556 Thursday 12 April 2018 

Thursday 12 April 2018 C002D5556 


21

22 

BUSINESS DAY 

C002D5556 



C002D5556 

BUSINESS DAY 23 

BDLegalBusiness 

Business Law Industry Report Practice Intelligence Partnerships 

Legal500 hails Banwo 

& Ighodalo 

THEODORA KIO-LAWSON 

Global leaders in legal research, ratings and rankings, 

LEGAL500 on Tuesday took to its twitter handle to 

give shout-outs to leading global law firms on its 

Legal 500 EMEA (Europe, Middle East, Africa) 2018 ratings 

and rankings. 

Its shout-out went to top Nigerian law firm, Banwo & Ighodalo 

(B&I), hailing it as the firm with the highest number of leading 

individuals and next generation lawyers (combined) in 

Nigeria. 

Other felicitations went to Allen & Overy as the firm with 

the most leading individuals and next generation lawyers 

(combined) in the Netherlands and for also taking the highest 

number of top tier rankings in Slovakia; to Corpus Legal 

Practitioners and Musa Dudhia & Company for the highest 

number of leading individuals and next generation lawyers 

(combined) in Zambia; to Baker Mckenzie for the highest 

number of top tier rankings in Russia; and to Al Tamimi & 

Co. for the highest number of top tier rankings in the United 

Arab Emirates. 

The Legal500 research is conducted annually and covers 

81 countries, over 2,700 ranked law firms. Its EMEA guide 

provides an assessment of various factors including work 

conducted by law firms over 12 months. This includes experience 

and depth of teams; specialisation and expertise, 

ancillary services; as well as the opinions of law firms’ clients. 

Rankings are based on feedback from 250, 000 in-house peers 

and access to law firm deals and confidential matters, assessed 

by the organisation’s researchers. 

Civil rights lawyer, Emeka Nwadioke 

has advised the Lagos 

State House of Assembly to 

“urgently repeal” the controversial 

Land Use Charge Law 2018. 

In a statement at the weekend, 

Nwadioke described the LUC law 

as “unconstitutional,” noting that 

the law is in breach of the 1999 

Constitution. 

“The Land Use Charge Law 2018 

as presently enacted is in clear 

breach of Article 1 (j) of the Fourth 

Schedule to the 1999 Constitution,” 

said Nwadioke who is also a member 

of the Nigerian Bar Association 

(NBA) Criminal Justice Reform 

Committee. “The schedule, pursuant 

to Section 7 (5) of the Constitution, 

unequivocally vests the assessment 

of privately owned houses or 

tenements for the purpose of levying 

PIGB: Why the President must expedite 

action to give assent to this Bill 

On Wednesday March 28, 2018, 

the much-awaited reform of the 

Nigerian Oil & Gas Sector may 

have finally commenced, with the 

passage of the Petroleum Industry 

Governance Bill (‘PIGB’). This reform is not unusual 

as most of the countries with established 

National Oil Companies (‘NOCs’); as Nigeria 

has done, have developed their respective legal 

and regulatory frameworks, to benefit potential 

investors – but more importantly, her citizens. 

Comparatively over the last five years, countries 

like Uganda, Kenya, Tanzania and Ghana, have 

passed their respective petroleum sector bills in 

2012, 2016, 2015 and 2016 respectively. 

The PIGB as passed, is a revolutionary step 

towards creating a more efficient, transparent, 

competitive, local content driven Nigerian oil & 

gas market. It is the first of a series of laws, to restructure 

the industry to drive increased investor 

participation in exploration and production. 

After about two decades, and in what appears 

to be an elongated and tortuous exercise, 

a fragmented version of the original Petroleum 

Industry Bill (‘PIB’) is now to hand with Nigeria’s 

President, Muhammadu Buhari GCFR for his 

presidential assent. 

The Philosophy 

The Bill seeks to establish efficient and effective 

governing institutions, with clear and 

separate roles for the petroleum industry. It will 

also establish a framework, for the creation of 

commercially oriented and profit driven petroleum 

entities, that ensure value addition and 

internationalization of the petroleum industry, as 

well as promote transparency and accountability 

in the administration of petroleum resources in 

Nigeria. The law (when assented to), will foster a 

conducive business environment for petroleum 

industry operations. 

Unbundling and Consolidation of Functions 

of Agencies 

The PIGB provides three-pronged solutions 

to: the bureaucratic bottlenecks and regulatory 

inefficiency in the oil and gas industry, harsh 

Lawyer asks Lagos assembly to repeal LUC law 

rates on the local government.” 

“While we have taken notice of the 

remark by the honourable Speaker of 

the Lagos State House of Assembly 

that ‘the (LUC) law was all about 

increasing the revenue generation 

of the state,’” said the activist lawyer, 

“it is unthinkable and highly worrisome 

that a duly constituted group of 

lawmakers sworn on the Constitution 

would contemplate such brazen undermining 

of the same Constitution 

merely in a quest to shore up internally 

generated revenue.” 

According to Nwadioke, “All 

lovers of democracy and rule of 

law must rise in defence of the Nigerian 

Constitution from this latest 

onslaught. The cavalier manner in 

which the lawmakers have treated 

the Nigerian Constitution is unacceptable. 

No amount of legislative 

business environment for investment 

in the industry, and default in 

meeting the financial obligations of 

the government, on its investment in 

the industry. The unique approach 

offered by the Bill is the establishment 

of three institutions to pilot the 

change in the general operations of 

the oil and gas industry. They are: 

Nigeria Petroleum Regulatory 

Commission (NPRC); 

National Petroleum Asset Management 

Company (NPAMC); and 

National Petroleum Company 

(NPC). 

Following Presidential assent, 


L-R Emeka Chinwuba, Kieran Whyte, Jen Stolp & Calvin Walke at the Nigerian Bar Association 

Section on Business Law (NBA-SBL) Banking, Finance & Insolvency Committee 

2nd Quarter Members’ Forum. 

gymnastics can alter the right exclusively 

vested by the Constitution in 

the local government to levy tenement 

rates. 

“It is heart-warming that the 

Nigerian Supreme Court had in 

Knight Frank Rutley Nigeria v Attorney 

General of Kano State (1998) 

4 SC 251 upheld this unambiguous 

provision of the Constitution. The 

same is true of the Rivers State High 

Court in Grinaker LTA Limited v 

Board of Internal Revenue (Suit 

PHC/2842/2010). We are confident 

that when the opportunity again 

presents itself, the High Court of 

Lagos State will align itself with these 

clear-cut decisions.” 

Continuing, the former NBA 

Lagos Branch Publicity Secretary 

advised the lawmakers to instead 

“take immediate steps to empower 

the local government administration 

by vesting it with the power 

to levy and collect tenement rate 

among others, rather than engage 

in measures that further emasculate 

that all-important tier of government. 

This will enable it discharge its 

uniquely equipped roles as obtains 

in other jurisdictions.” 

It is recalled that the Lagos State 

House of Assembly had in an unprecedented 

move enacted that Lagos 

LGAs “may delegate to the State” 

the power to collect tenement rate.

24 BUSINESS DAY C002D5556 Thursday 12 April 2018 

THE YOUNG BUSINESSLAWYER 

Now let us talk welfare! (1) 

A 

survey 

was recently conducted 

to identify core issues 

that were pertinent to young 

lawyers, impacting their career 

progression, personal 

development and work life and about 

155 lawyers responded. Over 90% of the 

responses were similar and pointed to 

one core deficiency; neglect of the welfare 

of young lawyers. By the way, welfare 

is not synonymous with remuneration. 

Welfare is a synonym for wellbeing and 

transcends remuneration to include, 

comfort, happiness, development, health 

and prosperity. When viewed from this 

paradigm, welfare includes anything that 

makes for a fulfilling career and life. 

The question of the welfare of young 

lawyers is a well-known ingredient of 

most conversations between and about 

lawyers. Sadly, the corresponding action 

in this regard is significantly lacking. It 

appears there are seasonal upticks for 

the conversation and then a few strides 

are made but the impact is yet to be allencompassing 

or concentrated enough 

to tip the scale in a different direction. 

When asked what changes are to 

be advocated for, the responses were, 

regulated remuneration, mentoring, 

professionalism and respect of young 

lawyers, intentional or structured training, 

healthy work environment, inclusion 

in more challenging work. Some more 

disturbing responses pointed to what I 

would term abuse, they were along the 

lines of “young lawyers should be treated 

like human beings and not worse than 

slaves, oppression and abuse should be 

prevented”. A cumulative review of these 

issues raises critical questions as to the 

purpose of the longwinded education that 

lawyers undertake and the veracity of the 

“prestige” of being a lawyer; for many, the 

only reward for their labour is the communal 

hailing “De law!!!”. In my opinion, 

not too many lawyers called to the bar in 

Nigeria ever experience that prestigious 

character of the law, with most vicariously 

living through their more than distant 

seniors who have earned the benefit of 

the rewards of experience, hard work, 

connections and providence. 

Please do not get me wrong, I am not 

an advocate for lethargy or a system of 

hand-me downs without due qualification. 

There is indeed a place for hard 

work, proving yourself and working 

your way up to success but this must be 

juxtapositioned with a balanced reward 

system and obvious progression. This 

combination is what works and makes 

for fulfilment, the absence of either 

makes for discontentment. Little wonder 

the consistent attrition of the number 

of lawyers who remain in practice as 

we know it. 

At this point, credit is to be given 

to various law firms, associations and 

leading lights who have made it their 

concern to champion the cause of young 

lawyers, made sacrifices for them and 

DOCKET 

Court acquits emirates airline over alleged $1.6m Theft 

The Federal High Court in Lagos 

on Tuesday discharged 

and acquitted Emirates 

Airlines and ten others in a case 

brought against the airline alleging 

conspiracy and stealing of $1.630 

million belonging to Prince Ikem 

Orji. 

The airline and other defendants 

in the case were alleged to have 

conspired and stole four bags, one of 

which contained $1.630 million on 

December 19, 2007 at the Muritala 

Mohammed International airport, 

Lagos. 

Justice Mohammed Idris held 

that the prosecution failed to prove 

its case against all the defendants 

constantly invest in their development. 

However, pockets of impact will not suffice 

if we want a thriving legal services 

sector. A critical pillar of our association 

as lawyers should be the consolidation 

of efforts to ensure a minimum standard 

for the welfare at the onboarding stage 

and even beyond. As many as we appear 

to be, we are yet to hit the 250,000 mark 

of qualified and enrolled lawyers. All the 

numerous professional platforms exist 

within this limit and given the closed 

nature of the regulation of the profession, 

it should not be rocket science to 

work out solutions which are extensive, 

revolutionary and to the benefit of the 

most. 

There is a contra argument that is as 

germane as the cause for welfare; the 

case for profitability. Yes, law firms and 

businesses are set up for profit and a 

business that is yet to float or become 

profitable cannot be realistically expected 

to conform with idealistic notions like 

welfare or fair remuneration. You and I 

know however that this is not the case. 

While there are several organisations 

that uphold the notion of fair compensation 

and welfare, majority appear to 

believe that it is in the place of the young 

lawyer to earn stripes, hustle and even 

suffer before they deserve reasonable 

compensation or career progression 

and this is the paradigm that must be 

changed. 

Much is to be said about all these 

issues that have been highlighted but 

it appears that remuneration is centerfield. 

This has been given credence 

with the recent move by the Nigerian 

Bar Association to apply a mandatory 

minimum wage for young lawyers. 

This commendable move should be 

encouraged. Albeit, before application 

of such a general rule, there must be 

critical study and confirmation of the 

organisations who are able to commit to 

and sustainably adhere to the proposed 

minimum wage. The policy is then to 

be benchmarked against empirical evidence 

and capacity and where relevant, 

subventions may be proposed. It would 

be benefit no one, if the rules made are 

beyond reasonable doubts. 

Justice Idris described the claim 

as a fairy tale stating that there was 

no evidence suggesting such collusion. 

by nature defunct with the subjects being 

incapable of compliance. 

Empirical evidence shows that there 

are lawyers who earn as little as N15,000- 

N20,000 per month. In today’s Nigeria, 

that takes no one home and is even 

beneath statutory minimum wage. More 

disheartening is that for many a young 

lawyer, their earnings do not progress 

alongside the work they do or the length 

of time in practice. 

There is no reason that a young lawyer 

with over 5 years of experience should 

be earning N30,000 for 5 years without 

any change! And let no one say that this is 

due to performance ratings as that speaks 

to the quality and standards endorsed/ 

nurtured by the organisation. 

There is no reason that a lawyer would 

remain unpaid for months on end where 

it is apparent that the organisation has 

simply refused to prioritise payment 

despite its capacity to do so! 

There is no reason that a young 

lawyer who shows up at work every day 

would be asked to go home without 

monthly remuneration but earn only on 

the basis of an indeterminable commission 

which would be payable when the 

young lawyer brings business! 

There is no reason that a young 

lawyer would be asked to use his/her 

personal funds to fund company business 

without reimbursement! 

Lastly, there is no reason that a lawyer 

should be hired without a proper 

contract that states clearly what remuneration 

and benefits apply to his/her 

employment relations! You think this is 

incredulous, there are young lawyers who 

are informed of their salary per payday 

and largely based on whimsical appraisals 

conducted without set indices on the 

day salaries are to be paid. 

There is no gainsaying the need for 

urgent review and change. This must 

be done with tact, a genuine drive for 

change and to the benefit of the most. 

We will speak to the other issues in 

Part 2, please stay tuned. 

Oyeyemi 

OYEYEMI ADERIBIGBE is a Senior 

Associate at Templars. She is also the 

current Vice-Chairman of the Young 

Lawyers’ Forum of the Nigerian Bar 

Association -Section on Business Law 

and the Young Lawyers’ Committee 

Liaison Officer of the African Regional 

Forum of the International Bar Association. 

Feedback – Oyeyemi.aderibigbe@ 

templars-law.com ; yemiimmanuel@ 

yahoo.com. 

THE COLUMN GIVES PERSPECTIVE 

ON VARIOUS ISSUES YOUNG LAW- 

YERS DEAL WITH IN THE COURSE 

OF THEIR CAREER AND HOW THEY 

CAN OPTIMISE THEIR JOURNEY. 

The court further held that there 

was no evidence to show that any of 

the defendants were in Dubai at any 

time in order to have nexus with the 

missing bags. 

GlobalREPORT 

Microsoft calls for dismissal of U.S. 

Supreme Court privacy fight 

Microsoft Corp on Tuesday backed 

the Justice Department’s request 

that the U.S. Supreme Court dismiss 

a case pitting the two against each 

other over whether prosecutors 

An IRN survey of the UK Business 

Legal Services Market 

has revealed that demand 

for commercial legal advice will rise 

over the next 18 months, according 

to an annual market bellwether, but 

some sectors are becoming crowded 

with law firm teams created to serve 

specific industries. 

Of 180 large and SME businesses surveyed 

by IRN Research, most expect 

their demands for legal services to 

stay unchanged over that period. But 

nearly a third of large businesses and 

16% of SMEs predict a rise in their use 

of external advice. Just 9% of large 

businesses and 11% of SMEs expect 

a fall. Most large businesses reported 

using more than one law firm. 

IRN surveyed the websites of the top 

200 law firms to gauge how many 

have created vertical sector teams 

to advise different industries. Thirteen 

(13) vertical sectors are listed 

by over 50 firms, led by real estate 

(101), financial services and insurance 

(97), and hospitality, leisure and 

Lucia Raimanova, a Counsel at 

Allen & Overy’s International 

Arbitration Group has been 

nominated by the VIAC Board to the 

three-member panel on behalf of 

the respondent. Lucia relocated to 

Bratislava from London in June 2016 

to lead the firm’s international arbitration 

practice within the CEE. 

In her remarks, Lucia said, “Like 

many sectors, also international 

arbitration struggles with retaining 

female talent in leading roles. 

Securing gender equality in arbitrator 

appointments is no easy task. 

There is still an insufficient pool of 

experienced female arbitrators and 

it does not help that arbitrators are 

often associated with an image of 

white-haired men. In this case, my 

co-arbitrator and I made sure we 

had an equally qualified male candidate 

for the role of the Chairman 

of the Tribunal but, as luck would 

can force technology companies to 

hand over data stored overseas after 

Congress passed a law that resolved 

the dispute. 

---Reuters 

Demand for business law to 

rise, as competition intensifies 

sport (91). Another 10 sectors reach 

double figures. 

Some vertical sectors are already 

becoming crowded, the report 

warns, with the next emergent trend 

a move to more niche expertise. In 

health, for example, niche specialties 

include GPs, independent hospitals 

and social care. 

UK-based business law firms and 

chambers generated revenues of 

£15.4bn in 2017, says IRN, a 4% rise 

on the previous year. 

A&O lawyer makes history with first all-woman arbitral 

tribunal at Vienna International Arbitration Centre 

have it, we ended up with the female 

candidate who is doing a wonderful 

job as a Chairwoman.” 

The Vienna International Arbitration 

Centre (VIAC) is an international 

arbitration institution with a 

particular stronghold in Central and 

Eastern Europe (CEE), but attracting 

also parties from further afield, 

notably Africa and Oceania. 

Its recently-released annual 

report shows that it began 43 new 

international arbitration and mediation 

cases in 2017. Notably, it 

also reports the formation of its first 

all-female tribunal.


PROBONO 

Paul Usoro Challenge: A Bold Initiative at 

Advancing the Pro Bono Culture 

Though life was not perfect for 

24-year old Jimi Oladapo, at 

least he managed to get by. 

A graduate of Accounting from the 

University of Benin, Oladapo eked 

out a living working as a machine 

operator in a plastic production factory. 

After three fruitless years of job 

hunting, he was forced to swallow 

his pride, put away his impressive 

university degree and take up his 

present job. While the job was hardly 

his preferred option, it was, at least, 

a stop-gap measure that guaranteed 

him daily bread. 

However, the young man’s relatively 

stable life came crashing down 

after he was arrested for allegedly 

murdering his landlord’s son. Oladapo 

maintains that he acted in 

self-defense. According to him, he 

was attacked by the deceased and 

his brother and in a bid to defend 

himself, he killed the young man. 

One year after the incident and 

Oladapo is still languishing in prison 

even as he waits for the matter to be 

taken to court. Bereft of legal representation, 

abandoned by family, 

friends and the society as a whole, 

Oladapo’s fate mirrors the pathetic 

situation of Awaiting Trial Persons 

(ATP) in Nigeria. 

He is not alone. According to a 

fact sheet released by the Prisoners’ 

Rehabilitation and Welfare 

Action (PRAWA), a Lagos based 

Non-Governmental Organization 

(NGO); over 70 percent of inmates 

in Nigerian prisons are ATPs. They 

are left at the mercy of a legal system 

that simply has not lived up to its 

responsibility of guaranteeing much 

needed access to legal services for 

indigent citizenry. In truth, Oladapo 

and thousands of ATPs that are 

wasting away in prisons all over the 

country reflect the sad state of the 

Pro Bono culture in Nigeria’s legal 

space. 

The obvious dearth of Pro Bono, 

that is, the provision of free legal 

services for indigent people, is not 

limited to the criminal law scene 

in Nigeria. It also spills into civil 

disputes. Incidences of widows who 

are deprived of their late spouse’s estates, 

workers whose employments 

are terminated without receiving 

benefits due to them, amongst 

others, make headline news daily. 

A number of these cases go unresolved 

simply because the victims 

cannot afford the high cost of engaging 

counsel. 

Interestingly, Nigeria’s legal 

space has witnessed a number of 

initiatives put in place to provide 

legal support for indigent people. 

For instance, the Legal Aid Council 

(LAC), a department under the 

Federal Ministry of Justice was 

established in 1976, to provide free 

legal services to indigent Nigerians. 

In 2012, the Lagos State Government 

announced the establishment of 

the Lagos State Public Interest Law 

Partnership (“LPILP”) a partnership 

initiative between the State Government 

and over 100 law firms, to provide 

free legal assistance to indigent 

members of the public. 

In 2009, came the Pro Bono Declaration 

for Members of the Nigerian 

Bar Association (NBA), the Umbrella 

Body of Nigerian lawyers, which 

requires each member to provide 

more than 20 hours or three days of 

pro bono legal services per annum. 

In 2015, NBA took its stance on Pro 

Bono a notch further by encouraging 

law firms and lawyers to provide 

free legal services to at least five 

indigent families yearly. In addition 

to the aforementioned, several other 

NGOs like the Prisoners’ Rehabilitation 

and Welfare Action (PRAWA) 

have been in the forefront of providing 

pro bono services to people who 

cannot afford legal services. 

So, why has the culture of pro 

bono not gotten traction in Nigeria 

despite these laudable moves? 

The reasons are not farfetched. 

Quite simply, there are not enough 

lawyers and law firms stepping in, 

to provide free legal services to indigent 

people. With the exception 

of a few established law firms, a 

significant number of lawyers and 

law firms in the country are too 

enmeshed in the bread and butter 

struggle, to keep afloat, to bother 

about providing free legal service. 

True, the economic situation may 

well be a good reason for the dying 

culture of Pro Bono in Nigeria. However, 

is this excuse really tenable 

given that pro bono service in itself 

remains a sacrosanct responsibility 

which the legal profession prides 

itself in? 

James Etaghene runs a law 

chamber in Abuja. He admits to 

cutting down on his pro bono work 

to focus more on his business. “My 

brother, I have to look out for myself 

and my business before I think of 

helping others. In any case, the pro 

bono work would be funded by my 

business and things have not exactly 

been rosy with my firm, hence the 

decision to leave pro bono work for 

now,” he explained. 

All may not be gloom however, as 

legal luminary and foremost communications 

law expert, Paul Usoro, 

SAN announced the donation of 

N600, 000 as prize money to six lawyers 

in a new initiative tagged Paul 

Usoro Challenge. The Paul Usoro 

Challenge, a novel idea from the distinguished 

lawyer, is a social media 

driven campaign set up to recognize 

and encourage young lawyers to buy 

into the pro bono culture. The Challenge 

called on lawyers, between 

1-10 years of practice, to send in short 

videos of their pro bono work which 

would be assessed by a special panel 

comprising top legal practitioners 

(members of PBC panel). 

According to Usoro, the Challenge 

is a platform to celebrate the 

efforts of lawyers who were giving 

back to society through pro bono legal 

services and encourage others to 

join. He said: “From our experience 

in doing pro bono work, we realized 

that there are lots of young lawyers 

out there who are doing so much 

for the society, through free legal 

services. The Pro Bono challenge is a 

platform for us to share the fantastic 

stories of these young lawyers and 

challenge not only their peers but the 

entire legal space to emulate them,” 

he said. 

Speaking on Pro Bono practice 

in Nigeria, Mrs L. Y. Salau, Deputy 

Director, Legal Aid Council, stated 

that “Pro Bono is a way veritable way 

in which lawyers can give back to the 

society. Unfortunately, most lawyers 

shy away from this area except when 

they want to meet the requirements 

for the rank of SAN. A lawyer who 

genuinely does pro bono cases will 

a have sense of fulfilment. 

The second edition of the Paul 

Usoro challenge is already underway 

with modifications to its scope. 

Head of Chambers, Paul Usoro & Co, 

Munirudeen Liadi revealed that this 

edition has been packaged to accommodate 

a broader spectrum of pro 

bono services. Contestants have also 

been extended to include lawyers 

between 1 and 15 years’ experience 

at the bar. Specifically, lawyers who 

have handled pro bono cases in areas 

of law enforcement agents’ brutality, 

domestic violence, gender related issues, 

child abuse can now participate 

in the Challenge. 

Speaking on the notion behind 

this, Liadi said that “Our aim is to 

cover more areas of pro bono work. 

Based on experience, we’ve been 

convinced of the need to open the 

opportunity to lawyers handling 

these cases and also expand the 

scope in terms of years of practice. 

It is no secret that abuse of human 

rights is rife in Nigeria. In one breath, 

we’re encouraging pro bono work 

and as well helping to get more hapless 

Nigerians out of difficult situations,” 

he said. 

The Challenge was opened for 

entries from the 9th of February to 

the 9th of April. Six Lawyers with the 

most compelling cases, after evaluation 

by a designated panel of judges, 

will be rewarded with N100, 000 each 

for their efforts. 

C002D5556 

PIGB: Why the President must... 


the NPRC will be established to assume 

full upstream, midstream, and 

downstream regulatory functions of 

the Department of Petroleum Resources 

(‘DPR’) and the Petroleum 

Products Pricing Regulatory Agency 

(‘PPPRA’). This will address issues 

of “red-tapism” in the industry, and 

reduce frictions; characteristic of the 

oversight functions of the DPR and 

the PPPRA. 

The Bill, as law, will empower 

the NPRC to determine and enforce 

standards relating to industry 

activities, which includes designs, 

construction, installation, operation, 

and maintenance of all plants, 

facilities, and equipment used 

in petroleum related operations. 

Furthermore, in collaboration with 

the Federal Ministry of Environment 

(‘FMoE’), the NPRC will be 

lumbered with the responsibility 

of making and enforcing environmental 

regulatory standards in the 

industry. An important part of the 

Bill, is the regulation of activities of 

oil and gas companies on environmental 

issues. 

The PIGB, post-presidential assent, 

will establish the ‘NPAMC’. The 

NPAMC, which is modelled after 

the Malaysian PETRONAS, will be 

expected to manage the PSC assets, 

where government has no immediate 

funding obligation. At incorporation, 

the Bill provides a transmission 

of employees, assets, rights and 

obligations of the Nigerian National 

Petroleum Corporation (NNPC) to 

NPAMC. An important industry concern, 

is the backlog of legacy debts 

hanging with the NNPC. It has been 

proposed that these legacy debts 

be mopped into a special purpose 

vehicle (such as was done with the 

Nigerian Electricity Management 

Company in the Electricity Sub- 

Sector), which the government 

will capitalize to liquidate these 

outstanding liabilities. Put simply, 

the huge liabilities’ portfolio of the 

NNPC will be severed and transferred 

to a Vehicle to be named 

Oil &Gas Liability Management 

Company (“OLMC”). The aim of the 

suggested severance, is to ensure 

a seamless transfer of the assets of 

NNPC to the companies that will 

take over, without burdening them 

with the liabilities. It is expected 

that the liabilities will be efficiently 

managed by the OLMC, in the same 

way the National Electricity Management 

Company (“NELMCO”) 

is saddled with the liabilities of the 

defunct Power Holding Company of 

Nigeria in the power sector. 

Some Stakeholders have however 

disagreed with this position, for 

fear of government’s actual commitment 

to capitalize the SPV. In truth, 

if NPAMC is to operate as a clean 

company which can attract foreign 

lending, then government and the 

Stakeholders must consider this 

option and seriously too. 

The ‘NPC’ for its part, will take 

over assets with existing cash call 

obligations. It is expected that at any 

time within 6 years of the operation 

of the Bill, 30% of the shares of the 

NPC will be divested to members 

BUSINESS DAY 

25 

of the public. The opportunity for 

the private sector investment in the 

company, will undoubtedly increase 

the operational efficiency of the 

company. 

Other Matters 

Independence of the NPRC 

Political intervention in the 

administration and regulation of 

activities in the industry, as well as 

excessive ministerial powers, have 

been major concerns for stakeholders 

and potential investors alike. 

This intervention however appears 

to have been ingeniously addressed, 

as the PIGB has now donated the 

powers to issue and revoke licenses 

in the industry, to the Nigeria Petroleum 

Regulatory Commission 

(NPRC). 

Similarly, the Minister no longer 

assumes the role of appointing 

members of the NPRC. That role has 

now been donated to the President. 

However, one must view this with 

cautious optimism as, when viewed 

against the present situation (where 

the office of the President is fused 

with that of the Minister of Petroleum), 

such excessiveness may still 

pervade; which will render the relevant 

provision of the Bill otiose. The 

independence of the Commission is 

entirely dependent on the separation 

of the offices of the President 

and the Minister of Petroleum. 

The Equalization Fund 

The Petroleum Equalization 

Fund (PEF) is setup with the objective 

of ensuring economic balance 

in the price of petroleum products 

throughout the country. With a 

5% tax return on sales of petroleum 

products, the Fund seeks to 

achieve equitable opportunities to 

oil marketing companies, for losses 

incurred due to sales of petroleum 

products at the uniform price. Aside 

the regular functions of the Fund in 

the reimbursement to oil marketers 

for their losses incurred in the 

marketing of oil and gas products 

around the country, it has been 

provided that the Fund will also be 

spent on infrastructural development. 

Although this is not an entirely 

new concept, the Bill has introduced 

that the Fund should also be used 

for ‘infrastructural development’. 

Conclusion 

Now that the framework regulating 

the Nigerian Oil & Gas Sector 

has been passed by the 8th National 

Assembly and awaits presidential 

assent, the industry should be 

geared towards recouping the infrastructural 

deficit it has suffered over 

the years, preparing itself as an attractive 

bride to potential investors, 

and seek to recover the over $235 

billion lost as a result of the delay in 

the passage of the Bill. 

It is important that this Bill becomes 

law as quickly as possible. 

We therefore urge the office of the 

President to expedite all procedures 

to give its assent to the Bill. The PIGB 

is a catalyst and the game changer 

in the Nigerian Oil & Gas Sector. 

Tolu Aderemi is the Partner-incharge 

of Perchstone & Graeys’ 

Energy Team.


INDUSTRYFILE 

DCS hosts stakeholders in infrastructure 

and real estate at 7th Detail Business 

Nigeria’s first commercial 

solicitor firm, specializing 

in non-court 

room practice, Detail 

Commercial Solicitors 

(DCS), last week organised the 

7th edition of its Business Series in 

Lagos. 

The event, which took place at 

the firm’s purpose-built office in 

Lekki brought together key players 

in infrastructure, who had in-depth 

discussions on how to drive policy 

changes in the real estate sector to 

aid its growth. 

Speakers and panelists at this 

event include, Andrew Nevin, Partner 

and Chief Economist, PwC, 

Sonnie Ayere CEO Dunn Loren 

Merrifield, Toyin Ajose, associate 

partner heading Detail’s real estate 

and construction practice, Dolapo 

Omidire, founder and team lead, 

Estate Intel. See BusinessDay Newspaper, 

on Monday April 9th, 2018 for 

the full story. 

POWERPERSPECTIVE 

MBAH ALPHEUS ANAYO ESQ. 

The Lagos State Electricity Power 

Sector Law is a product of Governor 

Akinwunmi Ambode 

people orientated policy to provide 

direct state intervention for a stable, 

affordable and reliable power supply 

in Lagos State. The legislation is the 

legal frame works that give legal backing 

to the Light-Up-Lagos program 

designed to add on incremental basis 

3000MW of electricity to Lagos State. 

This policy backed by this beautiful 

piece of legislation came at a time 

when direct government intervention 

has become the last resort to provide 

the much needed stimulant to unlock 

private investments into the Nigeria 

Power Sector. 

The objectives of the law as prescribe 

by Section 2 are inter alia; 

provide for the development and 

management of a sustainable power 

supply in the Lagos State; facilitate 

the development and management 

of electricity infrastructure within the 

state; ensure availability of cost reflective 

tariff; provide support in the 

collection of tariffs and revenue from 

embedded power end users; collaborate 

with Federal, State, Energy and 

Electricity Power related Agencies to 

promote and support investment in 

the electricity power projects within 

the state.The Bill which received 

the ‘No Objection’ of the Nigeria 

Electricity Regulatory Commission 

before being passed into law has 

now become a reference point that 

States can indeed contribute their 

own quota towards bridging the gap 

of electricity supply to the people. 

The Law has received so many 

encomiums from power industry 

players and greeted with the same 

frenzy that came with the privatization 

of power sector with majority of 

power investors now turning to Lagos 

State as an investment destination. It 

is to be noted that until the relevant 

stakeholders envisaged by the law 

to implement the Light Up Lagos 

program, carry out their functions in 

L-R, Dolapo Kukoyi, Partner, DETAIL; Sonnie Ayere, CEO, Dunn Loren Merrifield; Tosin 

Ajose, Associate Partner DETAIL participating at the 7th DETAIL Business Series. 

L-R: Femi Williams, CEO, Chams Plc; Abdulmalik Mahdi, 

Director, Sales, Brains & Hammers; Tosin Ajose, Associate 

Partner DETAIL; Dolapo Omidire, Founder & Team Lead, 

Estate Intel speaking as panellists at the 7th DETAIL Business 

Series. 

Andrew S. Nevin, Partner 

and Chief Economist, 

PwC Nigeria speaking at 

the 7th DETAIL Business 

Series. 

Lagos state electricity power sector law 

2018: understanding the role of the state, 

distribution companies and NERC 

accordance with the law and regulatory 

framework, the law and purpose 

of the Light Up Lagos program will 

remain a political statement that will 

not see the light of the day. 

The Law itself is just the path to 

the end and not the end itself, a conscious 

and committed effort is therefore 

required from Lagos State, the 

Distribution Companies in Lagos 

(Eko Electricity Distribution Plc and 

Ikeja Electricity Distribution Plc) 

and the Nigeria Electricity Regulatory 

Commission to achieve the 

much desired effects of the law. 

Each stakeholder as envisaged 

by the law must restrict itself to 

its role under the law and other 

regulations governing the electricity 

industry in Nigeria for there to 

be meaning achievement of the 

Limitation of actions: Time freezes while litigation is pending 

Continued from last week 

Court’s Judgment and Rationale 

The Supreme Court held that the main 

issue between the parties was “when did 

the Respondents’ cause of action arise and 

whether the time spent at the Federal High 

Court should not be counted? In deciding 

this issue, the Supreme Court agreed with the 

Respondents that the cause of action accrued 

when the Respondents obtained the certified 

true copies of the incorporation documents 

of the 5th Appellant from the Corporate Affairs 

Commission. 

Augie JSC relying on the Supreme Court’s 

decision in UBN v. Umeoduagu (2004) 13 

NWLR (Pt. 890) 352that it is only reasonable 

that a party can only sue when he becomes 

aware that this right has been tampered with, 

held as follows: “…they (the Respondents) 

went in search of the truth from the right 

source. I also agree that this truth triggered 

their right to take necessary action. The truth 

they sourced from CAC confirmed that…the 

Appellants went behind the Respondents to 

incorporate the 5th Appellant.” 

On the second issue, the Supreme Court 

held that nothing was said in the Judgment 

of the Court of Appeal to alter Respondents’ 

case to a shareholders’ dispute.The Court 

of Appeal merely narrated the facts in the 

Respondents’ pleadings to trace what triggered 

their right to take necessary action. 

Furthermore, referring to the foreign book 

relied on by the lower Courts, the Supreme 

Court agreeing with its decision in Araka 

v. Egbue (2003) 17 NWLR (Pt. 848) 1 at 

20, held that‘there is nothing in our laws 

that says the Nigerian Courts cannot rely 

upon foreign decisions…they are useful in 

the expansion of the frontiers of our jurisprudence’. 

As such, where there has been 

no decision on whether limitation period 

shall count or not during the pendency of 

an earlier suit, the lower Court was right 

to ‘…look around for principles in decided 

cases that will proffer answers thereto’. 

On the effect of a statute of limitation, 

the Supreme Court relied on its decision 

in Asaboro v. Pan Ocean Oil Corporation 

Nigeria Ltd (2017) LPELR-41558, where it 

held that the statute bars the action and not 

the cause of action. The cause of action refers 

to facts the Claimant must adduce to be 

entitled to any relief, while the action is the 

medium through which he ventilates those 

facts. As such, Amina Augie JSC held: “I 

agree; earlier Suit filed by the Respondents 

cannot be dead; it is alive and so it can be 

resuscitated, which is what Respondents 

achieved, when they filed this Suit at the 

incremental power as envisaged by 

the Light-Up-Lagos program. The 

ability of the law to support real 

investment and mobilize the much 

needed private funds into the Lagos 

State electricity market will depend 

largely on the legal regulatory 

compliance by the stakeholders as 

early controversy and/or disagreement 

regarding the violation and/ 

or undermining of the law in the 

implementation of the program will 

totally destroy the good intention of 

the policy and erode the confidence 

of foreign and local investors who 

will not risk investing in a process 

that may be successfully challenged 

in the court of law. 

All Stakeholders must be willing 

to limit itself to the powers conferred 

on it by the law and other relevant 

laws governing the power sector. It 

is in this regard that we analyze the 

roles of various stakeholders under 

the law with a view of charting a 

proper road map for the implementation 

of the law and policy towards 

achieving the targeted 3000MW 

incremental power in the state. 

THE ROLES OF LAGOS STATE 

GOVERNMENT 

The Role of Lagos State under 

the Lagos State Power Sector Law 

2018 is to formulate relevant policies 

that will support the development 

of embedded generation, 

the distribution of the electricity 

and ensuring collections from the 

customers. 

Section 5 of the Law rightly provides 

that the Lagos State Ministry 

of Energy and Mineral Resources 

shall among other things be responsible 

for the initiation, formulation 

and coordination of power sector 

reform policies and programs of 

the state; supervise, monitor and 

evaluate the implementation of all 

power policies and programmes in 

the state; create an enabling environment 

for private investment in 

the power sector; provide support in 

the collection of tariffs and revenue 

from embedded power end users. 

Section 4 of the Law vested on 

the Lagos State Ministry of Energy 

and Mineral Resources the rights 

to issue licenses to the feedstock 

Merchants (Gas suppliers) while the 

Nigeria Electricity Regulatory Commission 

retains issues license to the 

Embedded Power Providers. 

The Law established Lagos State 

Embedded Power Commission with 

the responsibility to collaborate with 

Nigeria Electricity Regulatory Commission 

to make certain regulations 

for the embedded power project in 

the state. The Lagos State Embedded 

Power Commission is also empowered 

to appoint licensed entities to 

trial Court with the requisite jurisdiction 

to entertain this matter, and the time spent 

at the wrong Court cannot be counted; it 

was suspended.” 

Therefore, the fact that the Respondents 

quickly filed the action at the High Court 

(within 2 months) signified that the Respondents 

did not sleep on their rights. 

Lastly, the Supreme Court held that based 

on the statement by Appellants’ counsel 

that the livewire before the trial court is the 

incorporation of the 5th Appellant, the issue 

of non-joinder is a non-issue. Additionally, 

that the Court of Appeal was right that the 

non-joinder of the Nigerian Ports Authority 

and the Bureau of Public Enterprises is not 

fatal to the Respondent’s suit. 

The appeal was dismissed with costs ofN300, 

000.00 awarded in favour of the Respondents. 

Comments 

Notwithstanding the foregoing, this laudable 

Judgment is a reminder that novel 

decisions can and are still being delivered 

in Nigerian courts, in order to meet up with 

legal developments worldwide. The term 

‘frozen period’ allows for suspension of the 

limitation period due to certain supervening 

circumstances. This is the first time such a 

situation would be considered and decided 

by the Supreme Court in Nigeria. 

As was recognised by Augie JSC: “The truth is 

that so far there has been no decision of this 

Court on the issue of whether limitation period 

shall not run during the pendency of an 

earlier suit.” Thus, the issue and the Judgment 

are novel and have become a locus classicus 

on the point that the time spent in a wrong 

Court in an earlier suit cannot be counted, 

as it was ‘suspended’ or ‘frozen’. 

The Supreme Court has thus shown its 

readiness to support the growth of Nigerian 

law and jurisprudence. As was held by 

Oguntade JSC in Amaechi v. INEC (2008) 5 

NWLR (Pt. 1080) 227 at 315E-H and relied 

on Packer v. Packer (1954) P. 15 at 22“…If we 

never do anything which has not been done 

before we shall never act anywhere. The law 

will stand still whilst the rest of the world 

goes on and that will be bad for both.” The 

Supreme Court in Nigeria has followed the 

same approach…” 

Chief Wole Olanipekun, SAN, Gani Adetola-Kazeem, 

SAN, A.B. Ogunba, SAN, 

Bolarinwa Awujoola Esq, Adelani Ajibade, 

Esq(for Appellants) 

Mr. M. I. Igbokwe, SAN, Mr. Chioma Okwuanyi, 

Sir Adolphus Nwachukwu KSJI 

and Mrs. Winifred Tayo-Oyetibo (for the 

Respondents). 

procure aggregate feedstock (gas) 

for utilization under the Embedded 

Power Scheme; collaborate with Distribution 

Companies to pre-qualify 

Embedded Power providers under the 

Embedded Power Scheme. 

The Law also established the 

Lagos Embedded Power Council 

with responsibility among others to 

address consumer complaints in the 

state; provide input in the determination 

of end-user tariffs to ensure costreflective 

tariffs for embedded power 

and carry out such other activities as 

are conducive to the discharge of its 

duties under the Law. 

The Law established a Power 

Task Force with responsibility for the 

enforcement of the provisions of the 

law with powers to make arrest and 

prosecute any person for offences 

committed under this law especially 

offences on power theft, electricity 

asset vandalization and unauthorized 

use of electricity in whatever form. 

The Law also empowers the Lagos 

State Ministry of Finance and 

the Lagos State Debt Management 

of Office pursuant to the approval 

of the Governor to issue payment 

Guarantee to the Embedded Power 

producers and Feedstock Merchants 

to backstop their payment. 

To be continued next week


C002D5556 

BUSINESS DAY 

27 

Absence of perimeter fencing puts 

airport security on edge 

Stories by IFEOMA OKEKE 

The absence of perimeter 

fencing across major 

airports in Nigeria may 

continue to cause runway 

incursions, which 

could be a threat to security. 

BusinessDay’s checks show that 

only the Nnamdi Azikiwe International 

Airport, has perimeter fence 

in Nigeria. 

The situation may remain this 

way for till next year as the Federal 

Government may not provide perimeter 

fences across the airports 

this year. 

The Federal Airports Authority 

of Nigeria (FAAN) recently disclosed 

that it will capture the construction 

of perimeter fences in all airports in 

the 2019 budget. 

Experts say 2019 may be too late 

for this development as Nigerian 

airports continue to remain porous 

and could be threat to security if 

immediate steps are not taken to address 

security lapses at the airports. 

The recent incursion of Akure 

airport runway by cows that caused 

Air Peace aircraft to delay landing 

for about 20 minutes, thieves opening 

up cargo hold at the airport, the 

falling off of Dana door upon arrival 

in Lagos airport and the recent incidents 

of theft at the airports has 

again brought to the fore the need 

to improve aviation safety through 

ensuring that aircraft, airport runways 

and airside are secured. 

Meanwhile, stakeholders have 

queried what the Federal Government 

did with N5.87 billion World 

Bank credit facility for perimeter 

fencing and other infrastructural 

equipment such as fire tenders. 

The Abuja airport fencing was 

said to have gulped $65 million. 

While other stakeholders wondered 

what happened to budgetary allocations 

for the same projects for 

Port-Harcourt and Lagos, year in, 

year out. 

John Ojikutu, member of aviation 

industry think tank group, Aviation 

Round Table (ART) and chief 

executive of Centurion Securities, 

told BusinessDay that if the NCAA 

had put security fences across airports 

in the country, there would 

not be incursion of the runways 

by cows. 

“The NCAA and the Federal Airports 

Authority of Nigeria, (FAAN) 

should be blamed for absence of 

security fences across our airports. 

There are certain things we must 

have in place before we are certified 

to operate the airport. If NCAA approved 

the airports to be operating 

without perimeter fences, the airline 

should know that. 

“This information should be 

in the Aeronautical Information 

Publication (AIP). The pilot must 

read it before he departs. The 

operators too should be blamed 

because if they are going to Akure, 

they should take precaution on 

landing,” Ojikutu added. 

He recalled that in 1990s, when 

he was the airport commandant 

people were farming on the runway 

side of the Murtala Muhammed 

International Airport, (MMIA), until 

he had to put a stop to it. 

On the issue of poaching, Ojikutu 

advised FAAN to “withdraw 

company identity cards from disengaged 

staff and ensure same for 

ground handling staff; limit number 

of staff working in the aircraft and 

apron, and conduct regular background 

checks on all. Ensure regular 

payment of salaries; demand 

for security enhanced fences and 

regular patrol of aircraft manoeuvring 

areas.” 

An operator who craved anonymity 

said, “Our perimeter fences 

are not enhanced for security fences. 

The International Civil Aviation 

Organisation, (ICAO) has recommended 

that they go and make security 

fences to protect the operational 

area and they haven’t done that. 

However, Henrietta Yakubu, general 

manager, public affairs, FAAN, 

in an interview in Lagos, said the 

issue of security across the airport 

remained a great concern to the 

organisation. 

Yakubu said the incident at Akure 

was being addressed, stressing that 

the airport had perimeter fence but 

there was a gap in which the cattle 

entered through to the runway. 

According to Yakubu, FAAN civil 

engineers were already at the Akure 

airport to fix the collapsed section 

of the fence. 

As part of measures to further 

strengthen the security of the airports 

across the country. She said 

FAAN had stopped the renewal of 

On Duty Cards (ODCs) for former 

airline and FAAN workers to ensure 

strict personnel monitoring. 

The card renewal will be thoroughly 

scrutinised by the agency, 

she said, saying all security measures 

have been reviewed while 10 

vehicles have been added to the 

ones on ground to enhance runway 

patrol in order to minimise aircraft 

runway attacks. 

Ministry, agencies embark on 

capacity building for aviation sector 

In a bid to build capacity for the 

aviation industry, the Ministry 

of Transportation and all the 

aviation agencies including the 

Federal Airports Authority of Nigeria 

(FAAN), Accident Investigation 

Bureau (AIB) Nigerian Airspace 

Management Agency (NAMA), the 

Nigerian Civil Aviation Authority 

(NCAA) have held an enrichment 

programme for members. 

Anchored by the Centre for Cooperative 

Training, Research and Development 

of the Obafemi Awolowo 

University, Ile-Ife, the two-day seminar 

which held at the Administrative 

Staff College of Nigeria (ASCON) 

Badagry focused on critical areas of 

empowerment such as financial intelligence, 

taxation of income of public 

servants, utilisation of cooperative 

fund, health tips for healthy living 

among others. 

Speaking on the training workshop, 

Babatunde Sotin, the President 

of the Cooperative Society, said the 

quest to build capacity of members 

particularly in entrepreneurship derives 

from the determination of his 

administration to invest in human 

development. 

According to him, “you are aware 

that in the past couple of years we 

have invested in building structures 

for the society-guest house, offices, 

etc. Going from there, we now want 

to encourage and assist members 

who have business ideas to go into 

agriculture or any other business that 

can bring in additional income. 

“Soft loans will be provided for 

members after feasibility studies 

and other legalities are conducted, 

but before they do that, they need 

to be equipped with the necessary 

skills and know-how, hence this 

programme.” 

Sotin said this new directive 

became imperative as “it would ensure 

that members do not retire into 

penury as several cases have shown 

in the past.” 

He also revealed that more training 

programmes have been lined up 

to accommodate as many members 

as possible in the near future. 

Installation of CCTV at Lagos, Abuja 

airports 90percent ready- FAAN 

The on-going installation 

of Closed Circuit Television 

(CCTV) cameras at 

the airsides of Murtala 

Muhammed Airport (MMA), Lagos 

and Nnamdi Azikiwe International 

Airport (NAIA), Abuja has 

reached between 85 and 90 per 

cent completion stage. 

This is as Boss Mustapha, the 

Secretary to the Government of the 

Federation (SGF) would declare 

open the forthcoming Airport 

Council International (ACI) to be 

hosted by Nigeria. 

Henrietta Yakubu, the general 

manager, Corporate Communications 

of the Federal Airports 

Authority of Nigeria (FAAN) disclosed 

this to aviation reporters 

at the agency’s office at the Lagos 

Airport. 

Yakubu pointed out that the 

on-going installation of the CCTV 

Cameras at the airsides of the two 

airports in the first phase would 

further improve security at the 

airports, adding that FAAN would 

continue to improve on safety and 

security of humans and equipment 

at all airports across the country. 

She explained that after the 

completion of the installation of 

the equipment at Lagos and Abuja 

in the first phase, FAAN would 

move to Kano, Port Harcourt and 

Enugu Airports for the second 

phase. 

She added that the agency had 

trained its security personnel on 

the handling of the equipment 

and assured that security would 

be better enhanced at the nation’s 

airports with the usage of the 

equipment. 

“On the security, we have 

done a lot and the CCTV cameras 

are being installed at the airside. 

We have improved on illumination 

around our airsides. Right 

now, safety audits are on-going at 

the Port Harcourt Airport, Enugu 

and Kano Airports. The essence 

of this is to ensure that we are 

adhering to the standards set,” 

Yakubu said. 

“At the moment, we have 

reached about 85 to 90 per cent 

completion stage. We are doing it 

in phases. In fact, we are mounting 

it at MMIA, Abuja in the first phase 

simultaneously and after this, we 

will go to Kano, Port Harcourt and 

Enugu Airports. 

“The project has been on for 

a long time even before the issue 

of alleged incursions into 

the airports. It is just that we are 

facilitating and we want to ensure 

that it is done within the shortest 

period. Our security staff have 

been trained on how to monitor 

the equipment and others within 

the airports.” 

On the forthcoming ACI Africa 

conference, Yakubu declared that 

FAAN would use the opportunity 

to open up the aviation sector to 

internal and external investors. 

She explained that Mustapha 

would declare open the conference 

while Hadi Sirika, Minister 

of State for Aviation, Bernard 

Aliu, President of Council, International 

Civil Aviation Organisation 

(ICAO), and Angela Gittens, 

Director-General li Tounsi, ACI 

World would also be in attendant. 

She added: “We are expecting 

experts to come with their wealth 

of ideas that will help us to move 

our airports from just being a 

government entity to more viable 

airports and the ones that can 

declare profit. 

“The Ease of Doing business 

too has helped us to move forward 

as we showcase our potential and 

activities. The ease of doing business 

has helped us to collapse 

several formalities in checking 

the passengers, we don’t have too 

many checks at the airports any 

longer, but that does not stop us 

from still doing the security check.”

Innovation Apps Fin-Tech Start-up Gadgets Ecommerce IOTs Broadband Infrastructure Bank IT Security 


Apps released on Apple 

Store drops in 2017 

FRANK ELEANYA 

Google Play 

Store appears 

to be winning 

the favourite 

app store contest, 

as the amount of apps 

released in the Apple App 

Store fell for the first time 

in 2017. 

A new data released by 

Appfigures showed that 

both Apple’s App Store and 

Google Play Store were 

growing consistently all the 

way up to 2017, when the 

former began to drop. 

The data found that 

the amount of apps released 

on Apple’s App 

Store in 2017 was 755,000, 

representing a 29 percent 

decline from 2016, when 

the number hit one million. 

It is Apple’s first drop 

since the App Store was 

launched in 2008. 

Meanwhile, the Google 

Play Store saw a surge of 

over 1.5 million new apps, 

about 17 percent rise from 

2016 – the largest growth 

since 2014. 

According to Appfigures, 

the decline is a result of 

stricter enforcement of Apple’s 

review guidelines, as 

well as a technical change 

that eliminated many old 

apps that were not updated 

CALEB OJEWALE 

In this part of the world, 

many things that could 

still look like magic or 

at best, science fiction, 

are realities in advanced 

nations increasingly leaving 

us behind. While this may 

not be new, it also shows 

the urgent need for African 

countries like Nigeria to stop 

admiring technology from 

afar, but also actively engaging 

in usage. 

Ericsson showed some of 

these possibilities for a digital 

future in its ‘10 Hot Consumer 

Trends’ 2018 report 

which during a presentation 

by Olivier Vandermoten, 

country manager, Ericsson 

Nigeria, showed the world 

is about to move ahead with 

even more sophistication 

than previously thought. 

For instance, if you find 

yourself thinking of the possibility 

to “re-live” certain 

to support 64-bit architecture. 

In June 2017, Apple had 

sent a notification to developers 

that new iOS apps 

and updates submitted to 

the App Store must support 

64-bit. 

“Support for 32-bit apps 

is not available in iOS 11 

and all 32-bit apps previously 

installed on a user’s 

device will not launch. 

If you have not updated 

your app on the App Store 

to support 64-bit, we recommend 

submitting an 

update so your users can 

continue to run your apps 

on iOS 11, which will be in 

moments from the past, this 

just may be possible within 

the next five years, provided 

you have pictures from that 

event. Still seems strange? 

Well, not according to Ericsson’s 

report which from its 

findings showed consumers 

in the next five years 

will amongst other things, 

be able to walk through 

pictures from events, using 

virtual reality gears that 

make it possible to interact 

‘with the past’. 

As more advancement 

are made in robotics, it 

has also been suggested 

that those not so inclined 

to work, though lazy may 

sound ‘judgmental’, could 

have robots doing their 

work, earning income for 

them, while they take all 

the leisure time they desire. 

The possibilities seem endless 

from the very desirable 

ones to those perhaps, not 

so desirable. 

The 10 trends for 2018 

the hands of hundreds of 

millions of customers this 

fall,” Apple stated in that 

notice. 

Apple’s stance has seen 

the number of apps overall 

inside its App Store shrink 

by 5 percent, falling from 

2.2 million to 2.1 million, 

whereas, Google Play, is 

home to 3.6 million apps, 

continuing a steady 30 percent 

rise also observed last 

year over 2015. 

Appfigure also disclosed 

that during the period, the 

number of apps being ported 

from one platform to 

the other – also known as 

‘porting’ an app – increased. 

10 technology trends about to change how we live 

and beyond as contained 

in Ericsson’s report include: 

1. Your Body is the User 

Interface: More than half of 

current users of intelligent 

voice assistants believe that 

we will use body language, 

expression, intonation and 

touch to interact with tech 

devices as if they were fellow 

humans. Some 2 in 3 think 

this will happen within a 

mere 3 years. 

Olivier Vandermoten 

Porting an app refers to taking 

an app that was built 

for one platform and building 

it to run on a different 

platform. 

In 2017, over 25,000 

crossed from one platform 

to another. More than 16,000 

of those apps went to Google 

Play in the same year. 

“According to our algorithm 

that maps apps that 

cross platforms, roughly 

450,000 apps are available 

for both iOS and Android. 

This is a failry decent 

amount, but when we 

look at the bigger picture, it 

amounts to just 8.5%,” Appsfigure 

stated. 

2. Augmented Hearing: 

63 percent of consumers 

would like earphones that 

translate languages in real 

time. 52 percent want to 

block out a family member’s 

snoring. 

3. Eternal Newbies: 30 

percent say new technology 

makes it hard to keep their 

skills up to date. But it also 

makes us instant experts. 

46 percent say the internet 

allows them to learn and 

forget skills faster than ever. 

4. Social Broadcasting: 

Social media is being overrun 

by traditional broadcasters. 

But half of consumers 

say AI would be useful to 

check facts posted on social 

networks. 

5. Intelligent Ads: Advertisements 

may become too 

smart for their own good. 

More than half of augmented 

reality (AR)/virtual reality 

(VR) users think ads will 

become so realistic they 

will eventually replace the 

Takeaways from Organic 

Lagos startup workshop 

FRANK ELEANYA 

Starting and building a 

successful business in 

a country like Nigeria is 

a journey that only the 

brave and committed undertakes. 

Several statistics have it 

that many small businesses in 

Nigeria never see their third 

to fifth birthdays. Choked by 

insurmountable pressures, 

they die and new ones spring 

up from their ashes. 

On Saturday, 7 April, 2018, 

Organic Lagos, a non-profit 

organisation organised the 

maiden edition of its startup 

workshop aimed at equipping 

small businesses with the tools 

for entrepreneurial success. 

The workshop themed ‘Let’s 

Talk About Starting Up and 

building Successes’, was also 

an avenue to train start-ups on 

accessing funding. 

Muyi Olaitan, founder of 

Organic Lagos said the goal of 

the workshop was to expose 

start-ups in Nigeria to new 

trends and innovations to scale 

their businesses in a difficult 

environment. 

The various facilitators at 

the workshop shared from 

their experiences in business 

and dealing with start-ups – 

whether in the tech ecosystem 

or SMEs segment. Below are 

some of the takeaways from 

the workshop: 

Passion is everything 

Kola Kuddus Yusuf, chief executive 

officer of Kola Kuddus 

Couture, an African inspired 

fashion brand, said starting out 

as an entrepreneur will require 

passion and commitment. 

products themselves. 

6. Uncanny Communication: 

50 percent think not 

being able to tell the difference 

between human and 

machine would spook them 

out. 40 percent would also 

be spooked by a smartphone 

that reacts to their mood. 

7. Leisure Society: 32 

percent of students and 

working people do not think 

they need a job to develop a 

meaningful life. 40 percent 

say they would like a robot 

that works and earns income 

for them, freeing up leisure 

time. 

8. Your Photo is a Room: 

Imagine being able to walk 

into a photo and relive a 

memory. 3 out of 4 believe 

that in only 5 years they 

will use virtual reality to 

walk around in smartphone 

photos. 

9. Streets in the Air: City 

streets may be choked with 

traffic but the skies remain 

free. 39 percent think their 

Team: Frank Eleanya, frank.eleanya@businessdayonline.com; Caleb Ojewale, caleb.ojewale@businessdayonline.com 

Recalling the early days of 

his brand, Kola told the audience 

that he was largely driven 

by the passion to make his client 

look unique always. 

Social media is not all it 

seems. 

People are always pretending 

on social media platforms, 

hence small business owners 

have to be careful about 

the ideas they get from there, 

according to Shade Ladipo, 

executive director of WE- 

Connect. 

Integrity breeds trust 

Businesses built on dishonesty 

will not last long. Customers 

would always be loyal to a 

brand they can bank their 

words, says Precious Ubah, 

assistant manager of Robert 

Taylor Limited. 

“Your focus should not be 

to build a business for the now, 

but one that can be transferred 

when you are gone. You have 

to put in the work and be part 

of something great,” she said. 

Funding only meets planning 

Funding is one of the issues 

many start-ups are always 

complaining about, however 

only a few actually are ready 

to access it. To be ready, 

Adeola Olowe, partner at 

The Anavo Institute, said 

start-ups need to know their 

numbers off their finger tips. 

For instance, what will the 

venture cost? What is projected 

cost for the next project the 

startup is embarking on? 

Knowing these numbers 

and being able to articulate 

them comes very handy in an 

elevator pitch situation. 

city needs a road network for 

drones and flying vehicles. 

But almost as many worry 

that a drone would drop on 

their head. 

10. The Charged Future: 

The connected world will 

require mobile power. More 

than 80 percent believe that 

in only 5 years we will have 

long-lasting batteries that 

will put an end to charging 

concerns. 

The insights in the 10 

Hot Consumer Trends for 

2018 report are based on 

Ericsson Consumer Lab’s 

global research activities 

over more than 22 years, and 

draw on data from an online 

survey of advanced internet 

users in 10 influential cities 

across the world, performed 

in October 2017. Although 

the study only represents 

30 million citizens, their 

early adopter profile makes 

them important to understand 

when exploring future 

trends, says Ericsson.


BUSINESS DAY 

29 

Harvard 

Business 

Review 

Global Business Perspectives 

CONNECTING THE WORLD ONE BUSINESS AT A TIME 

Data for Sale 

SUSAN FROETSCHEL 

EAST LANSING, Michigan 

— The scandal 

involving Facebook 

and data-mining 

company Cambridge 

Analytica dramatically confirms 

the adage of no free lunch. 

Facebook’s more than 2 billion 

users are waking up to the fact 

that the “free” online site extracted 

a stiff price: personal 

data. 

News reports that Cambridge 

Analytica swept up details 

on millions of Facebook 

users — then used details for 

targeted political advertising 

in many countries — jolted the 

industry, regulators and users. 

Yet users consented to data exchanges 

without reading pages 

of small print of terms of service 

agreements. Many companies 

profit handsomely from knowing 

the details of users’ phone 

calls, driving patterns, family 

history, credit card purchases 

and more. 

Of course, Facebook is not 

alone. Big-data analysis is big 

business. Companies continue 

to discover new value in crossindustry 

exchanges, combining 

forces to monetize data sets to 

improve services, reduce fraud, 

attract new customers or meet 

regulatory requirements. Cambridge 

Analytica is not alone 

either. In China, the Shanghai 

Data Exchange, started in 2017, 

offers a platform for trading all 

types of consumer information 

gathered from telecommunications, 

credit cards and more 

with the aim of drawing technology 

firms to the city. 

Collecting data to assess target 

groups is not new. Decades 

ago, telemarketing firms relied 

on typists to go through phone 

books, cross-listing names and 

numbers with other public lists. 

The college application process 

has long been a data-mining exercise 

to determine which applicants 

are likely to enroll and 

graduate. 

Patients, borrowers, students 

Mark Zuckerberg, the chief executive of Facebook, speaks at a conference in San 

Jose, Calif., April 18, 2017. Addressing for the first time the growing data privacy 

scandal, Zuckerberg outlined several steps the company was taking to address the 

issue on March 21, 2018. “We also made mistakes, there’s more to do, and we need 

to step up and do it,” he wrote in a post. (CREDIT: Jim Wilson/The New York Times) 

who fill out offline application 

forms are not exempt from becoming 

targets. Paper forms are 

quickly scanned into computer 

files. Large community events 

and fairs offer opportunities 

for data gathering. Hundreds of 

vendors attending large home 

shows hold contests to gather 

potential customer contacts. 

Computers made data collection 

easy. Any type of data 

can be packaged and marketed. 

Cities already provide data on 

properties, taxes and public 

health as a public service. To 

improve efficiency, utilities in 

India, Europe and the United 

States rely on smart meters to 

monitor and predict patterns of 

energy and water use. Committees 

and policies for monitoring 

data use and information governance 

so far are not keeping 

up with the growing numbers 

of organizations gathering and 

trading data. 

Data products can be specific, 

offering details about individuals, 

or aggregated to relay 

broad trends. Laws in the United 

States and Europe protect individual 

health, education or financial 

information, but do not 

ban aggregation as described in 

privacy policies, terms of agreement 

and license agreements. 

Health is an especially sensitive 

area, and privacy laws, even 

the strict new data protections 

to be imposed by the European 

Union in May, include exceptions. 

The EU law requires that 

patient data “be collected for 

a specific explicit and legitimate 

purpose” but allows that 

same data to “be reused for research” 

for the public interest 

purpose of driving innovative 

treatments. The same law limits 

how long patient data can 

be stored, “except for archiving 

and scientific research purposes.” 

Explicit patient consent is 

not required as long Financial 

firms collaborate on data collection 

to avoid risks. Insurers 

form special units for collecting 

drivers’ data. Digital strategies 

fuel growth, explains Boston 

Consulting Group. Companies 

combine online business processes 

with communications 

and services to gather data. 

App developers respond with 

entertaining quizzes, surveys 

and games designed to entice 

consumers to hand over more 

data. The harvest of Facebook 

profiles began with a small personality 

test, fewer than 300,000 

users took part for a tiny sum, 

and in the process millions of 

friends got dragged into the net. 

Less than 20% of third-party 

app developers for Facebook’s 

platform are based in the United 

States. Developers like Elitech 

in India provide customdesigned 

applications or games 

that assess target audiences and 

prioritize user engagement. 

Developers can use games to 

assess user performance and 

personality with small tasks 

from placing an order to solving 

problems. Facebook encourages 

developers around the world 

to develop local apps that will 

lead to more local users. 

Asia leads the world with 

more than 30% of 20 million 

app developers while Europe 

and North America each have 

about 30%. Economic Times reports 

that India leads the world 

in Facebook users and has the 

second largest base of Facebook 

developers. Developers 

and social media firms worry 

about new regulations disrupting 

the growing industry. Apps 

and games available from Apple’s 

iTunes Store went from a 

few hundred in 2009 to more 

than 3 million in 2017, with 

downloads in the billions. 

Apps take advantage of the 

universal desires to play, un- 

derstand ourselves, or compare 

how we perform with others. 

Experts analyze user choices, 

associating interests as detected 

by searches and clicks with 

individual behavior, hunting for 

patterns and correlations. Some 

companies offer discounts to 

customers deemed as reliable 

or creditworthy; other firms 

hunt for gullible, impulsive 

spenders. 

Unorganized data may seem 

worthless, and Facebook and 

countless others readily opened 

the gates to app developers and 

advertisers with little attention 

to the ultimate goals behind 

data transfers. Soon after news 

emerged about Cambridge Analytica’s 

use of Facebook profiles, 

Mark Zuckerberg issued 

an apology, admitting that even 

social media executives had 

not realized the full potential of 

their platforms and how many 

insights might be gleaned. 

He admitted not imagining in 

launching Facebook in 2004 

that the site could be accused of 

changing the course of an election. 

His strategy is for communities 

to decide their values and 

rules for Facebook. 

Users have a choice on what 

to share and with whom. Like it 

or not, big-data analysis influences 

communities and workplaces, 

and users have a responsibility 

to read lengthy policies 

with care. A lesson emerging 

from the Cambridge Analytica 

and Facebook debacle is that 

those who refuse to surrender 

data cannot evade the consequences 

especially when so 

many other users do share. Millions 

of friends whose data was 

harvested may not have given 

specific consent, but in the end 

that did not matter. 

(Susan Froetschel is editor of 

YaleGlobal Online and the author 

of five novels including 

“Fear of Beauty” and “Allure of 

Deceit,” both set in Afghanistan.) 

2017 Harvard Business School Publishing Corp. Distributed by The New York Times Syndicate

30 

BUSINESS DAY C002D5556 Thursday 12 April 2018 

Luxury Malls Companies Deals Spending Trends 

Nigeria’s over N25bn leather valuechain 

to receive new lease of life 

...as The Lagos Leather Fair engages stakeholders 

STEPHEN ONYEKWELU 

At the peak of Nigeria’s 

recession, that is, over 

two quarters of consecutive 

negative economic 

growth, since 

the first quarter of 2016, economic 

diversification became paramount 

and Nigerians started looking inwards 

to grow the naira. 

The campaign for Made in 

Nigeria products took a new dimension 

and the awareness has 

grown that even without compulsion, 

Nigerian leaders assumed 

front-row in actively drumming 

up support for products. Senator 

Ben Murray Bruce kicked off the 

spirit by amplifying the hashtag 

#BuyNaijatoGrowtheNaira on 

Twitter two years ago. 

In this light, locally Finished 

Leather Goods (FLGs) such 

as shoes, handbags and other 

fashion accessories hold great 

investment opportunities. The 

leather industry has been identified 

by the Bank of Industry to 

generate an annual income of 

N24.5 billion with limited support 

and also have the capacity 

to create over 700,000 direct and 

indirect jobs, therefore implying 

that the industry has not been 

maximized to its full potential. 

The Lagos Leather Fair is a first 

of its kind in Nigeria for all the 

stakeholders along the leather 

value chain, and was created to 

identify the challenges facing the 

industry with the hope to discuss 

possible innovative and sustainable 

solutions. The first edition 

held 2017, and this year the fair 

is scheduled to hold on the May 5 

and 6 of May, 2018 at the Federal 

Palace Hotel, Lagos. 

Founded by Femi Olayebi of 

Femi Handbags, the fair is a private 

initiative that seeks to promote 

leather designers by creating 

a networking platform to showcase 

their work and eventually 

provide the much-needed training 

for artisans that would essentially 

improve the general quality of our 

finished products. 

In 2017 over 2,500 people gathered 

for the first edition of the fair 

to learn from the various master 

classes, panel discussions and creative 

workshops. Attendees also 

got to shop and discover Madein-Nigeria 

leather products from 

over 50 leather exhibitors. 

According to Ogbonnaya Onu, 

the Minister of Science and Technology 

who spoke at the validation 

workshop on National Leather 

and Leather Products Policy held 

in Sokoto in January 2018, ‘the 

leather industry is the nation’s 

next gold mine and holds the key 

to industrial growth, jobs and 

wealth creation’. He also described 

the leather industry as ‘strategic 

in view of its importance in the 

economic diversification of the 

country’. 

The most popular FLG products 

are footwear (around 85 

percent of all FLGs). Slippers 

and sandals comprise around 80 

percent of footwear production, 

data from Growth and Employment 

in States (GEM) shows. 

GEM’s programme is a five-year 

programme jointly funded by the 

World Bank and the Department 

for International Development 

(DFID), United Kingdom. GEM 

2012 report estimates the annual 

market for Nigeria FLGs at about 

$200 billion. 

The main FLG production 

areas are Kano, Onitsha, Aba and 

Lagos. Covered shoes dominate 

production in Aba with an annual 

production of 6, 000, 000 

shoes at an average retail price 

of N5, 000 ($ 16) per unit this 

gives N3 billion ($10 million) 

annually. This is only for the 

captured covered shoes market. 

One thing seems clear, there is 

great potential here. Covered 

shoes are equally significant in 

Lagos and Onitsha, while slippers 

and sandals are dominant 

in Kano and Kaduna. 

However, FLG producers specialise 

in low-end products or 

poor quality with poor finish, 

made with technologies and tools 

that have been mostly abandoned 

in the rest of the world. Nigeria 

manufactures and sells only lowend 

shoes and slippers of poor 

quality, while more than 120 

million pairs of basic, medium 

quality leather shoes are imported 

from Asia. 

“One of the biggest challenges 

we have is sourcing high 

quality, unique leather materials 

locally for our production. In addition 

the local artisans might be 

skilled but their finishing often 

falls below international standards” 

said Eseoghene Odiete, 

founder/CEO Hesey Designs 

Ltd. 

Another shoe maker, Francis 

Chukwu, managing director, Frantonia 

Industries Limited said that 

apart from military and paramilitary 

shoes, school shoes are also 

in high demand. 

He explained that his production 

capacity has increased from 

100 pairs per day to 250 pairs per 

day. 

To meet with demands, Chukwu 

said he has increased the 

number of ancillary staff from two 

to four people. For instance, I’m 

currently making shoes for schools 

and these schools are coming from 

outside the state. 

He said also that importers are 

now patronising quality shoes 

made-in-Aba but appealed to 

Federal and State Governments to 

provide infrastructure, especially 

roads and electricity, to support 

industrialisation. 

The Aba leather products cluster 

was identified as the densest in 

Nigeria. It consists of over 15,000 

enterprises with 23,000 regular 

employees and an annual turnover 

of $100 million. 

This year, the fair is themed 

‘The New Possible’ as it will focus 

on the many possibilities and massive 

potential the Nigeria leather 

industry has to offer. To encourage 

up and coming designers, the 

“Emerging Designers Competition” 

has been introduced, and 

is aimed at giving young, aspiring 

leather designers an opportunity 

and a platform to showcase their 

work. The top five finalists will win 

a cash prize, a mentoring opportunity 

and a booth at the Fair. 

Power oil resumes pay with calories campaign 

…extends health activation to Rivers, Anambra state 

CHINWE AGBEZE 

Power Oil, Nigeria’s 

healthy cooking oil 

brand has extended 

one of its annual consumer 

health awareness 

activities, ‘Power Oil Pay with 

Calories’, to Rivers and Anambra 

state to promote a healthy lifestyle 

while reminding Nigerians of the 

benefits of a daily fitness routine. 

The activation which commenced 

five years ago is open to 

consumers who are willing to work 

out and be rewarded on the spot 

for burning calories. 

According to the organisers, 

this is aimed at engaging consumers 

in series of exercises both on 

the treadmills and cyclers to burn 

calories, which would eventually 

be rewarded with amazing gift 

items depending on the amount of 

calories being able to burn within 

a specific time. 

The events which held at Onitsha 

Mall and Port Harcourt Mall 

created an exciting platform for 

the brand to interact with its consumers. 

Sport oriented gift items 

were laid out for consumers to pick 

from according to calories burnt 

within a specified time. 

Amisha Chawla, brand manager, 

Power Oil, said the experiential 

campaign was borne out of the 

necessity to encourage Nigerians 

to be mindful of their health. 

“The activation is simply 

to promote healthy living by 

encouraging Nigerians to pay 

more attention to their body and 

be cautious about the quality 

of what they consume in order 

to maintain a healthy heart,’’ 

Chawla said. 

‘‘We also make it a point of duty 

to advice Nigerians against the 

consumption of low-quality or 

sub-standard cooking oil, which 

on the long run puts consumers at 

risk of heart related diseases and 

other health issues.” 

According to Omotayo Abiodun, 

public relations manager, 

‘‘Power Oil Pay with Calories 

activity’ had always been held in 

Lagos, Ibadan and Abuja in the 

last couple of years. However, 

in order to have more Nigerians 

especially from the Eastern part 

of the country benefit from the 

health awareness campaign, 

it was extended to Rivers and 

Anambra state.’’ 

The consumer engagement 

activation was extended to more 

states with the strong believe that 

it will motivate and encourage 

consumers to understand the importance 

of leading a healthy life 

for themselves and their family. 

“We had so much fun while 

getting rewarded for that made 

it more interesting, I applaud the 

Power Oil brand for bringing the 

event to Port Harcourt, and we 

shall be looking forward to another 

edition,’’ said Tony Chris, a 

participant in Port Harcourt who 

also burnt 53 calories. 

Ngozi Ibekwe, a participant 

in Onitsha who lost up to 30 

calories and got rewarded with a 

tummy trimmer, commended the 

brand for its unflinching efforts 

in encouraging Nigerians to live a 

healthier life through their various 

health friendly activities.


C002D5556 

BUSINESS DAY 

31 

LG Electronics has provided 

a free laundry 

service for residents 

of Ogba community 

and its environs that 

are faced with power and water 

challenges to efficiently carry 

out their washing chores. The 

laundry cabin is equipped with 

state of the art facilities to effectively 

take care of laundry needs 

of the people at no cost. 

The event which held at 

the LG showroom had top officials 

from Korea in attendance. 

Some of the attendees include; 

Choong Hak Lee, executive 

vice president, business support 

officer, LG Electronics; 

Dae Sik Yoon, vice president, 

LG Electronics as well as top 

management of LG Electronics 

West Africa operations led by 

Taeick Son, managing director, 

LG Electronics West Africa operations; 

Mohammed Fouani, 

managing director, Fouani Nigeria 

limited; Jiung Park, general 

manager, Home Appliances 

Division, LG Electronics; Hari 

Elluru, corporate marketing 

manager, LG Electronics West 

Africa operations alongside 

other dignitaries and the media. 

The Free Laundry tagged 

“Life’s Good with LG Wash” 

is part of the company’s corporate 

social responsibility 

program for the year which has 

been designed to help people, 

homes and the community at 

large lacking sufficient water 

and power to carry out their 

laundry requirement. This 

free laundry offered by LG 

Electronics will help people 

overcome laundry issues at free 

of cost as well as create convenience, 

comfort and availing 

them more time to handle 

other valuable activities. 

LG Electronics provides free laundry 

service to Ogba community in Lagos 

CHINWE AGBEZE 

It is designed to serve over 

50 people per day and it will 

operate on a daily basis from 

morning till evening in order 

to ameliorate the living 

conditions as well as support 

the daily washing requirement 

of people in the area. It 

is interesting to note that, LG 

Electronics has over the years 

continued receive accolades 

from Nigerian consumers for 

having their interest at heart 

in the development of cutting 

edge technological products. 

LG plans to be replicating this 

initiative in other strategic 

locations across the state and 

indeed the country. 

The Executive Vice President, 

LG Electronics in his 

opening remarks, said “as a 

global company, LG Electronics 

wants to use its capabilities 

to help local communities 

all over the world 

solving some of their regional 

issues. In this regard, I hope 

that ‘Life’s Good with LG 

Wash’ will help make your 

lives more convenient and 

comfortable. I hope that the 

opening of ‘Life’s Good with 

LG Wash’ will bring more 

spare time and comforts to 

residents here. LG Electronics 

will continue to support communities 

even in the future. 

However, the feat which 

seems to be the first of its kind 

L-R: Hari Elluru, corporate marketing manager, LG Electronics West 

Africa operations; Taeick Son, managing director, LG Electronics West 

Africa operations; Mohammed Fouani, managing director, Fouani 

Nigeria Limited; Choong Hak Lee, executive vice president, business 

support officer, LG Electronics; and Dae Sik Yoon, vice president, LG 

Electronics, during the commissioning of LG Electronics free laundry 

service recently at LG showroom in Ogba Lagos. 

in the country by any brand 

in the country will create a 

real difference in improving 

society and helping address 

social issues in Ogba and its 

environs. The facility contains 

several LG Washing machines, 

LG Dryers, LG Air Conditioning 

units, uninterrupted 

power supply, constant supply 

of water among others to 

ensure the facility operates 

seamlessly. 

Also commenting at the 

occasion Mohammed Fouani, 

managing director, Fouani 

Nigeria Limited, said: “this is 

what I truly call giving back to 

the society, because the real 

beneficiaries of this project are 

the masses, I believe they will 

take advantage of this initiative 

from LG Electronics to make 

life better for them. The laundry 

is fully equipped with modern 

facilities for a standard laundry 

service.” 

More so, LG Electronics 

has vigorously pursued its CSR 

initiatives with all sense of responsibility 

and commitment, 

placing it at the forefront of giving 

back to the society. In the 

educational and health sectors 

of the economy, the brand 

has contributed immensely 

by touching lives and institutions 

which is its CSR core 

thrust which should tilt toward 

human centric. Recently, LG 

made donations to health 

institution in Port Harcourt, 

Abuja and Kano all in a bid to 

give a facility lift to the health 

sector in the country. 

Bosch Power Tools launches first 

experience centre in Sub Saharan Africa 

Bo sch Power 

Tools Nigeria has 

launched the first 

experience centre 

in Sub Saharan Africa 

to deliver the latest tools 

to professional users and 

tradesmen. 

The experience centre 

which is birthed with the 

partnership of Amicable 

Concerns Limited is located 

in Victoria Island area of 

Lagos state. 

The centre focuses on 

professional users in the 

construction space as well 

as tradesmen, artisans, and 

craftsmen assisting users to 

meet the demands of the 

growing Nigerian economy, 

especially in the area of infrastructural 

development. 

‘‘Users can enjoy tailored 

application trainings, for 

example, with bench top, 

impact drills and measuring 

tools and have the opportunity 

to purchase the 

latest Bosch power tools 

and accessories,’’ said Frank 

Diermann, country sales 

director, Bosch Power Tools. 

‘‘To increase user convenience, 

the centre offers 

a drop off and pick up service 

for all aftersales service 

needs.’’ 

According to Diermann, 

the experience centre is 

essential for the Nigerian 

market. 

“In support of the rapid 

infrastructural developments 

in Nigeria, the exclusive 

first of its kind Bosch 

Power Tools experience 

centre in the Sub Saharan 

Africa provides professionals 

and tradesmen with 

know-how and tools that 

are easy to use and that will 

significantly increase productivity 

in their day-to-day 

work. The experience centre 

is essential for the Nigerian 

market,” he said. 

Bosch Power Tools officially 

opened the experience 

centre which is located 

at Block B Shop 4A, 

Eko Court Complex, Kofo 

Abayomi Street, Victoria Island 

Lagos on April 7, 2018. 

Living under poverty line 

How Nigerians are struggling to survive 

If you want to contact the writer of this story call: +234(0) 803 889 1567, +234(0) 

8155184838 chinwe.agbeze@businessdayonline.com 

Teacher in dire need of funds to undergo hip replacement 

Name: Godwin Adanon 

State of Origin: Lagos 

State 

Age: 26 years 

Dependents: None 

Occupation: Teacher 

I used to teach Music at 

Christabel Nursery and Primary 

School, Oshodi. I also 

taught Music in College Best 

Secondary School but I quit 

teaching in schools in 2015 

when I started experiencing 

a severe hip pain. 

I have had issues with my 

left leg for a long time but 

sometime in 2015, I discovered 

that each time I stood 

up to teach, the pain at the 

hip was always severe. 

What did you do when 

you noticed the severe pain? 

I went to General Hospital, 

Isolo, for diagnosis. I 

was referred to Ikeja General 

Hospital for X-ray. After the 

X-ray, I was told I needed a 

ment since then? 

I have not taken any treatment. 

The doctor advised me 

to be using crutches to avoid 

total breakdown of the hip 

since I don’t have the money 

for the surgery. I also have to 

use the crutches each time I 

want to go out to reduce the 

pain on my leg. 

I have had this issue for 

long and I usually take Renaf 

Plus and other pain-relieving 

drugs prescribed by my doctors. 

I take the drugs once in 

two days just to calm the pain 

and it lasts for a week, after 

which the pain would come 

up again. If that happens, I 

rush and get the drugs. 

How have you been coping 

since you noticed this 

in 2015? 

I had to stop teaching Music 

in schools. I only teach a 

student Music at home on Saturdays 

and I’m paid N15, 000 

surgery. The doctor said my 

entire hip has gone and must 

be replaced. 

The bill I was given was 

huge so I went to my pastor 

for prayers. One of the leaders 

in my church raised N50, 

000 for me and another leader 

from another church raised 

N50, 000, making it N100, 000. 

Since then (February 2016) 

till now, no more money has 

been raised. 

What is the cost implication? 

The bill I was given by 

the Lagos State University 

Teaching Hospital (LASUTH) 

on the September 30, 2016, 

was N823, 000 for the hip 

replacement, but recently, 

I went back to the hospital 

and was told I needed about 

N1.4million which will cover 

the surgery, admission bill, 

drugs, and blood. 

Have you taken any treata 

month. I used that money 

to support myself. My family 

are poor and could barely feed 

themselves let alone help with 

my medical bill. I still support 

them with the little I make. 

I cannot go far with the 

crutches. Sometimes, I have 

to trek from my house to the 

junction to catch a bus and 

that usually gives me a tough 

time. I discovered that each 

time I walk the bones at my 

hip rub against each other and 

that gives me serious pains at 

the hip. Each time I’m walking, 

the hip generates pain. 

The best thing I was told is to 

do the surgery. 

This hip problem has 

caused me so much pain. 

It’s hard for anyone to know 

what I’m going through but 

whenever I’m alone, I cry so 

much praying that God will 

raise men to help me do this 

surgery. 

Analysts: Chinwe Agbeze, Stephen Onyekwelu, David Ibemere, Graphics: Fifen Famous

32 

BUSINESS DAY 


GARDEN CITY BUSINESS DIGEST 

Groups lie in wait for FG’s 

new oil & gas policies 

•Point out areas of attention to government 

•Prepare action plan to win more deals for communities and citizens 

IGNATIUS CHUKWU 

Civil Society Organisations 

(CSOs), 

oil-based trade 

unions, and media 

groups have 

formed an alliance to press for 

proper implementation of the 

new oil and gas policies approved 

by the Federal Government 

in June 2017. The alliance 

emerged in Port Harcourt after 

two days of brainstorming to 

understand the pitfalls in the 

two bulky documents at the 

strategic workshop sponsored 

by FOSTER (Facilitator for Oil 

Sector Transformation). 

The experts numbering over 

24 picked out major policy gaps 

especially in the area of gas 

pricing and infrastructure and 

resolved to press for stricter 

implementation and drawing 

FG’s attention to areas that 

needed fine-tuning. 

The new alliance worked out 

ways to drive an activist crusade 

to make a difference henceforth. 

The workshop was convened 

by Adejumobi Fashola and 

Louis Brown Ogbeifun (PhD) 

from AfriTAL. Experts came 

from organizations such as 

Foundation for Environmental 

Rights, Women Environmental 

Programme, Divine Youth Initiative, 

NUPENG, PENGASSAN, 

KIF, NAGGOND, GASEN, etc. 

It was recalled that in June 

and July 2017, the Federal Executive 

Council approved the 

National Gas Policy and the 

National Petroleum Policy 

(NPP) which incorporated some 

broad-based economic growth 

and efficiency considerations. 

In addition, the two chambers 

of the National Assembly have 

passed the Petroleum Industry 

Governance Bill (PIGB). It is 

also anticipated that the fiscal 

framework for the industry is 

being contemplated in a new 

bill expected soon. 

It was agreed that to successfully 

bring about the policies 

into laws and subsequently 

implement them, CSOs have a 

vital role to play in the natural 

resource governance process. It 

was however realized that the 

capacity for CSOs to influence 

policy enunciation, formulation 

and implementation in a 

highly technical area such as oil 

and gas also depends on their 

understanding of the key technical 

issues within the sector. 

The participants were 

drawn from various advocacy 

backgrounds including the 

Media, Labour Unions and Non 

Governmental Organizations. 

They were split into two groups 

to brainstorm, tease out advocacy 

issues and engagement 

strategies to accomplish the 

tasks assigned. The two groups 

are: Oil Policy Group and the 

Gas Policy Group. 

The Oil Policy Group came 

up with mission strategies to 

advocate for the enthronement 

of an Oil Sector governed in 

a way for the benefit of the 

generality of Nigerians. Its key 

objectives include improved 

corporate relations between 

host communities and oils 

firms. The deliverable is to get 

every oil operator within the 

host community to design 

an inclusive business model. 

Ibe Kachukwu 

They believe that peace in the 

oil communities would create 

stability in the industry for 

maximum profitability. 

The activist group outlined 

activities to carry out in order 

to meet the objectives as advocacy 

to Ministry of Petroleum 

Resources (MoPR) for 

the renegotiation of new terms 

in the industry; to advocate 

for competitive, transparent 

and accountable contractual 

systems; set five months advocacy 

timeline to achieve group 

roadmap. 

Others include to ensure 

that the Ministry of Petroleum 

Resources is developing a communication 

strategy with the 

communities; engage with 

the National Assembly to pass 

the Petroleum Host community 

Bill; visit the community; 

engage the media; facilitate 

consultative meetings between 

the communities and the IOCs; 

examine contractual terms for 

disclosures that would allow 

stakeholders ask relevant accountable 

questions. 

These are aimed at pressing 

for fiscal regime that is progressive, 

transparent and accountable 

to encourage investors’ 

interest; ensure royalty is paid 

on offshore operations; press 

for contractual processes are 

open and competitive because 

it is a major area that corruption 

thrives. 

The group frowned at policy 

inconsistencies and somersaults, 

demanding for advocacy 

for strong institutions, demand 

for the passage of the new policies 

into laws, advocate for the 

industry to be made to run 

commercially and professionally, 

and press for passage of the 

Petroleum Industry Administrative 

Bill (PIAB). 

The group saw the need 

for citizens’ ability to demand 

accountability, and that there 

should be accountability scorecards 

by the communities over 

government actions. They said 

creating a scoring system for 

what the government has done 

from time to time could do this. 

“There would be capacity building 

for sensitization to enable 

the citizens to be effective in 

demanding for accountability. 

We need to set up community 

accountability networks”. 

Highlights of the Gas Policy 

Group showed that there is 

no serious or bankable reference 

to host communities. 

“Therefore, there is the need to 

identify Community liaisons 

that should be properly trained 

for the assigned tasks.” 

They observed that there is 

need for transparency in the 

Gas Flare policy to, for instance, 

show who is buying and where? 

“There is need for infrastructure 

mix and who should take responsibility 

for infrastructure. 

Leaving it to investors would 

add so many burdens on them.” 

On Gas Flaring, they observed 

that the policy aimed at 

ending gas flares should not be 

profit-based, but rather focused 

on job creation and acting as a 

catalyst for industrial growth. “It 

should not just be to pay for gas 

flared. Government can give 

five-year tax-free incentive to 

gas-ending investments. Gas 

is not as innocent as it looks. 

The gas policy must demand 

for plan for disposing toxicity 

waste to the end.” 

They noted that gas flare-out 

incentives were not clearly outlined 

in the new gas policy and 

that there was need for guarantees 

from the government on 

amortization on local currency 

fluctuations. “There is need for 

gender-inclusion without the 

lowering of standards.” 

On pricing, it was noted 

that there is the need to do 

cost-reflection in Naira instead 

of only in US Dollar. “At the 

moment, what goes to gas suppliers 

is only 30 per cent of 

what the DISCOs generated. 

There is need for risk guarantee 

to gas suppliers. There are lots 

of redundant infrastructural 

facilities in the country whereas 

there is the existing Trans-West 

Africa pipelines which should 

be maximized to reduce cost. 

There is no provision for funding 

and PPP clauses.” 

The group noted that it 

was absence of clear national 

policy that saw to the $2Bn 

spent in laying pipes to Abuja/ 

Kaduna/Kano where there are 

no industries for the uptakes, 

whereas there is a shortage of 

gas in the South with so many 

industries. “There is a ‘silos’ 

mentality instead of leveraging 

industrial assets. There 

should be proper identification 

of stakeholders and allies. 

There is however, the need to 

know opponents that could be 

turned into allies.” 

Actions plans lined up by 

the CSOs include creating massive 

awareness on the new gas 

policy and review competences 

of those expected to operate the 

campaigns. 

Is Ifeanyi Ararume the strongest guber force for Imo 2019? 

Port Harcourt by Boat 

With 


Ifeanyi Ararume 

buried his father inlaw 

in Amike area 

of Nkwerre last two 

weekends but it turned 

into a huge political rally. 

The crowd was simply 

too large. Most bigwigs 

in Imo politics struggled 

fuse to return it. So it was 

that the PDP had primaries 

just a day to submission 

deadline to INEC. It 

ended in a deadlock with 

Ararume. Udenwa and his 

party decided to ‘dash; the 

slot to Mike Ugwu, former 

minister of Industries believed 

to be Obj’s man, 

contrary to the laws of the 

PDP. Udenwa gave to the 

loser and Ararume went 

from court to court until 

the Supreme Court ordered 

it back to Ararume. 

This was in the era of great 

impunity of the powerdrunk 

ruling party where 

Obj was emperor. 

Udenwa struck by 

to put up presence there. 

Emmanuel Iwuanyanwu, 

was present and this 

spoke volumes. Achike 

Udenwa, who ensured 

Ararume never became 

governor in 2007, was 

announced with huge 

reaction by the crowd. 

Udenwa was an important 

factor in how 

Ararume and the PDP 

gave their banana to the 

‘monkey’ and have never 

been able to retrieve it 

to this day. Those who 

give their bananas to 

monkeys for safekeeping 

usually find out that the 

monkey would climb to 

the top of trees and removing 

the PDP machinery 

to the highest 

buyer, Ikedi Ohakim, 

then of PPA. Their belief 

was that the ticket would 

return soon. To their surprise, 

the ticket has never 

come back but poverty 

has struck the party for 

years. From Ohakim, Rochas 

Okorocha stormed 

the state and took it away 

to APC. Let’s forget that 

Ararume had to support 

Rochas against Emeka 

Ihedioha of PDP in 2015, 

thus also helping to push 

the banana further into 

the monkey kingdom. 

Now, all hands seem 

to be on deck to win 

back the lost paradise. If 

Ararume expected whatever 

deal he must have 

had with the governor to 

work, he may be discovering 

that he needs to 

fight Okorocha to get it 

back because the governor 

seems bent on handing 

it back to his family 

through his son in law. It 

seems all the losers now 

want to unite at last. This 

must explain the loud 

presence of Ihedioha at 

Ararume’s home It seems 

the politicians are beginning 

to realize that one 

per cent of something is 

better than 100 per cent 

of nothing. The presence 

of Madumere, the deputy 

governor to Okorocha, 

who thought he was the 

chosen one but is just 

finding out the truth, 

spelt volumes too. 

The biggest presence 

but not for Imo politics 

was that of the Alabo from 

Rivers State, Tonye Graham-Douglas, 

many times 

minister and the biggest 

influence in politics in the 

south-south at the moment, 

with his large entourage 

of chiefs and titled 

men and top women. 

It was as if Ararume 

is the new force and the 

rallying force in Imo if 

power must leave

Thursday 12 April 2018 C002D5556 BUSINESS DAY 33 

Live @ The Stock Exchange 

Top Gainers/Losers as at Wednesday 11 April 2018 Market Statistics as at Wednesday 11 April 2018 

GAINERS 

Company Opening Closing Change 

BETAGLAS N75.7 N71.95 -3.75 

FO N38.6 N37.5 -1.1 

PZ N23.45 N23 -0.45 

REDSTAREX N6 N5.7 -0.3 

DANGFLOUR N13.45 N13.15 -0.3 

LOSERS 

Company Opening Closing Change 

MOBIL N185 N183 -2 

DANGFLOUR N15.2 N13.75 -1.45 

ETI N17 N16.35 -0.65 

FLOURMILL N37.3 N36.8 -0.5 

NASCON N21.5 N21 -0.5 

ASI (Points) 40,846.24 

DEALS (Numbers) 4,462.00 

VOLUME (Numbers) 367,215,254.00 

VALUE (N billion) 5.328 

MARKET CAP (N Trn 14.754 

Stock market gains N125bn as investors 

raise bet on Mobil, Dangote Cement, others 

Iheanyi Nwachukwu 

The Nigerian 

stock market 

advanced by 

N125billion 

on Wednesday 

as investors raised 

wagers on equities of 

Mobil Oil Nigeria Plc, 

Dangote Cement Plc, 

International Breweries 

Plc, Lafarge Africa Plc, 

and Unilever Nigeria 

Plc. 

The Nigerian Stock 

Exchange (NSE) All 

Share Index (ASI) increased 

by 0.86percent, 

while the Year-to-Date 

(Ytd) return stood at 

6.81percent. After trading 

on April 11, 2018, 

twenty-seven (27) 

stocks gained against 19 

losers. 

Mobil Oil Nigeria Plc 

led the gainers table 

after its share price increased 

from N178.5 to 

N192, up by N13.5 or 

7.56percent; Dangote 

Cement Plc rose from 

N255 to N260, up by N5 

or 1.96percent; while 

International Breweries 

Plc advanced from 

N51.5 to N54, up by 

N2.5 or 4.85percent. 

The share price 

of Beta Glass Plc declined 

most, from 

N75.7 to N71.95, down 

by N3.75 or 4.95percent; 

Forte Oil Plc followed 

after its share 

price declined from 

N38.6 to N37.5, down 

by N1.1 or 2.85percent; 

while PZ Cussons 

Plc declined from 

N23.45 to N23, down 

by 45kobo or 1.92percent. 

The All Share Index 

(ASI) closed at 40,846.24 

points as against the 

preceding day close of 

40,499.04 points while 

Market Capitalisation 

closed at N14.754 trillion 

against preceding 

day close of N14.629 

trillion. 

The volume of 

stocks traded decreased 


from 388.27million 

to 367.21million, 

while the total value 

of stocks traded increased 


from N4.209 billion 

to N5.328 billion 

in 4,462 deals. 

Zenith Bank Plc, 

Skye Bank Plc, Access 

Bank Plc, GTBank Plc, 

and UBA Plc were actively 

traded stocks on 

the Nigerian bourse on 

Wednesday. 

The Financial Services 

sector led the activity 

chart with 307.43 million 

shares exchanged 

for N4.45 billion; followed 

by Conglomerates 

with 16.83million 

shares traded for 

N41billion. 

CPMI, IOSCO issue guidance on supervisory 

stress testing of central counterparties 

The Committee 

on Payments 

and Market Infrastructures 

(CPMI) and the International 

Organisation of 

Securities Commissions 

(IOSCO) on Tuesday published 

the framework for 

supervisory stress testing 

of central counterparties 

(CCPs). The framework 

provides authorities with 

guidance to support their 

design and implementation 

of supervisory stress 

tests for CCPs. 

In April 2015, the G20 

finance ministers and 

central bank Governors 

asked the Financial Stability 

Board to work with 

the CPMI, IOSCO and 

the Basel Committee on 

Banking Supervision to 

develop a workplan for 

identifying and addressing 

gaps and potential 

financial stability risks 

relating to CCPs that are 

systemic across multiple 

jurisdictions and for enhancing 

their resolvability 

(the joint CCP workplan). 

Since then, the committees 

have published guidance 

to enhance CCPs’ 

resilience, recovery and 

resolvability. The report 

published today addresses 

another key aspect of 

the joint CCP workplan. 

The CCP supervisory 

stress testing framework is 

designed to support tests 

conducted by one or more 

authorities that examine 

the potential macro-level 

impact of a common 

stress event affecting multiple 

CCPs. 

Among other things, 

such supervisory stress 

tests could help authorities 

better understand the 

scope and magnitude of 

the interdependencies between 

markets, CCPs and 

other entities such as participants, 

liquidity providers 

and custodians. This 

type of supervisory stress 

test is different from, yet 

may complement, other 

stress testing activities 

conducted by authorities 

seeking to evaluate the 

resilience of individual 

CCPs. 

In June 2017, the CPMI 

and IOSCO published 

the Consultative report: 

Framework for supervisory 

stress testing of central 

counterparties (CCPs). 

During the consultation 

period, they held an industry 

workshop with 

representatives from various 

market sectors and 

authorities from different 

jurisdictions. 

AIICO Insurance gross premium up 19% to N32.1bn 

…set to pay 0.5kobo dividend 

Modestus Anaesoronye 

Underwriting firm, 

AIICO Insurance 

Plc has reported 

a gross premium 

income of N32.1 billion 

for the financial year ended 

December 31, 2017, a 

growth of 19 percent from 

N27.96 billion in 2016. 

Its life business grew 15 

percent from N18.8 billion 

to N21.6 billion in 2017, and 

was driven by the increased 

popularity of her traditional 

life products, while the 

general business also grew 

from N7.6 billion in 2016 

to N8.7 billion in 2017, a 15 

percent increase, which according 

to the company was 

as result of its improved re- 

lationship with agents, brokers 

and various intermediaries 

during the year under 

review. 

Speaking on the Company 

Financial Management 

Commentary ‘Facts Behind 

The Figure’ for 2017, the 

Managing Director/CEO, 

Edwin Igbiti said “We experienced 

significant growth 

as a company in 2017” 

“We had to significantly 

increase our capacity and 

improve our processes to 

meet up with customer 

demands. Over the next 

few years, we have plans to 

grow our businesses, and 

this means we must invest 

in technology and people 

to ensure our processes are 

more efficient to increase 

customer service levels.” 

During the year under 

review, AIICO Insurance 

Plc paid claims amounting 

to N23.3 billion, an increase 

of 55 percent from N14.9 billion 

in 2016. This according 

to the Company was due 

largely to the increase in 

benefits payments in the life 

business, which rose from 

N6.1 billion or 53 percent to 

N17.6 billion in 2017. 

“Our life business is 

dominated by contracts 

with our clients that stipulate 

payouts at pre-determined 

times. It is therefore 

logical that as the business 

grows, payouts grow accordingly. 

Critical activities 

are cash and investment 

management, and these we 

keep a very close eye on.” 

Claims in the non-life 

and health management 

also increased by N1.1 billion 

each. 

The Company also grew 

its investment and other incomes 

by 92 percent in 2017 

to N15.1 billion from N7.8 

billion in 2016. 

“We continue to pursue 

an active investment strategy 

to take advantage of market 

conditions and improve 

our investment performance. 

The relatively lowinterest 

rate environment 

provided an opportunity for 

the company to make some 

gains through trading. This 

was responsible for net realized 

gains of N5.3 billion 

compared to N336 million 

in 2016.” 

Meanwhile, profits after 

tax declined to N1.3 billion 

from N10.2 billion in 2016, 

while total comprehensive 

income, however increased 

to a profit of N2.4 billion 

from a loss of N655 million 

in 2016., presenting shareholders 

opportunity for 

0.5kobo dividend as against 

0.2 kobo divided the past 

year. 

According to the management, 

“The company’s 

financial position remains 

robust, remains an area of 

focus for the company and 

is an indicator of our capacity 

and strength. Assets remain 

adequately matched 

to liabilities and legacy concerns 

have been appropriately 

addressed. Value has 

been created over the last 5 

years”, the Company stated. 

Total assets grew 19 percent 

to N92 billion in 2017 

from N77.5 billion in 2016, 

while shareholders’ equity 

also grew 25 percent to 

N10.9 billion in 2017 from 

N8.7 billion in 2016.

34 BUSINESS DAY C002D5556 

NEWS 

Investors bet on FinTech companies to grow earnings 

DAVID IBEMERE 

Investors are betting on 

FinTech companies 

to boost their capital 

as online peer-to-peer 

lending (p2p) continues 

to get approval of Nigerians 

as an alternative source 

of funding. 

P2p lending, also known 

as social lending or crowd 

lending, is a way of lending 

to individuals or businesses 

through online services that 

match lenders directly with 

borrowers without using traditional 

bank or credit union. 

The growth in the sector 

has been predicted to reach 

$897.85 billion globally, 

expanding at a significant 

compound annual growth 

rate (CAGR) of 48.2 percent 

to 2024, with Transparency 

Market, a research firm, 

sounding out Nigeria as one 

of the key markets propelled 

by the rise on internet penetration. 

With banks still reluctant 

to lend to all but those with 

the cleanest credit histories, 

p2p exchanges in the last two 

Mining confab set to provide opportunity for young Nigerians, investors 

DANIEL OBI 

Commercial value of 

Nigeria’s solid minerals 

sector is calculated 

at trillions 

of dollars. It is also said that 

the country loses about $40 

billion annually in untapped 

gold mineral alone. 

While Nigeria is seeking 

for more revenue and creation 

of jobs, unfortunately, 

the domestic mining that 

suppose to offer millions of 

jobs is underdeveloped, as 

it currently accounts for only 

0.5 percent of Nigeria’s GDP. 

Therefore, to deepen investors 

and young Nigerians 

interest in the sector, especially 

when songs of shift 

from oil and diversification 

is getting louder, a conference 

on the mining sector 

scheduled for May 30 – June 

1, 2018, put together by the 

private sector is providing 

a training opportunity 

NPA plans to grant new 5-year concession agreement to Lilypond Terminal 

AMAKA ANAGOR-EWUZIE 

Managing director 

of the Nigerian 

Ports Authority 

(NPA), 

Hadiza Bala Usman, says 

the authority is concluding 

plans to renew the concession 

agreement with the 

concessionaire of the Lilypond 

Container Terminal in 

Ijora (ie. APM Terminals), 

an off-dock terminal in Lagos, 

owed by the NPA. 

BusinessDay understands 

that the concessionaire 

of the terminal is also 

making serious plans to establish 

an export processing 

and logistics facility at the 

terminal, especially for agric 

produce and other nonoil 

goods, if the concession 

agreement is renewed by 

years have seen exponential 

growth in the number 

of players to over 15 players, 

which include Kia Kia, 

Fint, Zefund, Ren money, 

instafunds, Aella credit, C24, 

Creditville, Cs Advanced, 

Kudi money, Lidya, Pay connect, 

Snap credit, Zedvance, 

EZUlike, among others. 

Although financial advisers 

point out that the services 

are still new and lack the safety 

net offered by traditional 

lenders, some investors who 

spoke with BusinessDay admit 

the rates on offer are attractive 

for providing loan. 

Chigozie Madu, a banking 

and finance lecturer in 

Delta State Polytechnic, told 

BusinessDay, “Despite the attraction 

for investors it comes 

with a risk as there is no harmonised 

framework for the 

sector, the only available 

is the legal and regulatory 

framework that is generally 

applicable to financial institutions. 

However, the money 

deposited is not protected by 

the financial bodies, meaning 

losses have to be borne by individual 

lenders.” 

for young Nigerians to acquire 

professional skills and 

knowledge about different 

aspects of mining portfolios. 

Organisers of the conference 

with the theme ‘exploring 

young talents and 

professionals for ingenuous 

and competitive mining solutions 

for economic growth 

in Africa’ scheduled at Eko 

Hotels said the training and 

workshop sessions during 

the conference will cut across 

the key mining knowledge 

areas which includes technical, 

management and financial 

development. 

The Dipsolution Africa 

Mining Exhibition and 

Awards workshop will be 

certified and facilitated by 

industry knowledge partners, 

Kabiru Arogundade, 

the programme director, 

told BusinessDay 

He said the pan-African 

event would create a opportunity 

for sponsors, partners 

the NPA. 

Currently, the concession 

agreement, which was 

formerly given to APM Terminals, 

has long ended as 

the former concessionaire 

awaits NPA to renew the 

agreement. 

Speaking in Lagos on 

Tuesday, when the management 

of the Infrastructure 

Concession Regulatory 

Commission (ICRC) led by 

its acting director-general, 

Chidi Izuwah, paid her a 

working visit, Usman said 

the NPA management had 

resolved to key into the 

business model meant for 

the Lilypond Terminal, 

which she stated would improve 

service delivery in the 

terminal. 

She charged all concerned 

with the working 

Despite this, Jumai Ademola, 

a financial analyst, said 

he had deposited his money 

across Fint, Kia Kia and his 

returns had been consistent. 

“P2p lenders could in time 

replace traditional banks,” he 

said, noting that the “social 

lending” offered a solution to 

the problems that ordinary 

people face when trying to 

access personal loans, an innovative 

alternative that was 

going to shake up the banking 

sector.” 

“In the last few months, we 

get more lenders who want to 

deposit money with us,” Kola 

Alabi, founder of Kashnow, 

said. 

“Our borrowers using the 

site are rated according to 

their credit history, and lenders 

can choose to provide 

them with loans directly, or 

spread their loans across a 

pool of borrowers. 

“Although the default rate 

among borrowers has crept 

up slightly in recent months, 

we are operating a very rewarding 

programme both for 

our investors and borrowers,” 

Alabi said. 

and other interested companies 

to sell and promote 

their products and services 

to diverse audience. 

“Exhibitors will have the 

opportunity to meet oneon- 

one with their target 

audience while promoting 

their business to over 1,000 

key participants and over 

5,000 exhibition visitors 

across Africa and other continents,” 

Arogundade said. 

Describing the mining 

conference as one event 

with multiple opportunities, 

the programme director 

also said that there 

will be deal fair during the 

conference. This is aimed 

at building partnership/ 

investment around mining 

projects while creating 

a golden opportunity for 

participants in different categories 

to explore new business 

dimension and make 

exclusive investment and 

partnership deals. 

document for the review of 

the terminal’s agreement to 

speed up the processes that 

would allow for the swift 

consideration and possible 

approval for a five-year 

renewal being sought by 

management of Lilypond. 

According to Usman, the 

Authority is determined to 

support the completion of 

all deep seaport projects 

across the country, considering 

their potential to the 

future maritime activities in 

Nigeria. 

“The early completion of 

the deep port projects will 

not only facilitate operational 

efficiency in the nation’s 

maritime but would 

further strengthen the Federal 

Government’s policy of 

the Ease of Doing Business,” 

Usman said. 



TEXEM to discuss building successful 

organisations that endure 

happen by chance; strong 

partnerships and cooperation 

are key. For too long, 

a lack of cooperation has 

blighted our great continent’s 

development.” 

But change is happening, 

he pointed out. Nearly 

all Africa’s leaders recently 

signed the framework agreement 

to set up the African 

Continental Free Trade Area 

which, when implemented, 

will be the biggest free trade 

agreement since the establishment 

of the World Trade 

Organisation. 

Should all African countries 

join the continental 

free trade area by 2030, it will 

create a market of 1.7-billion 

people with a consumer and 

business spending capacity 

of $6.7-trillion. 

Separately, but compli- 

TEXEM, a business 

management training 

outfit, is inviting 

editor of a top British 

journal in May to discuss with 

senior managers in Nigeria 

what it takes to build a successful 

business organisation. 

The training is against the 

background of a research carried 

out by the National Federation 

of Independent Business 

(NFIB) in the USA, which 

showed that 56 percent of new 

companies fail within just four 

years of establishment. 

Evidence shows that the 

failure rate even for established 

brands in Nigeria is 

worse. It is therefore vital for 

senior executives to consistently 

develop strategic leadership 

skill sets to position their 

organisation for success. 

Due to the propensity 

for Nigerian organisations 

to fail as a result of the harsh 

contextual realities inherent 

in Africa’s largest economy, 

Respite for Nigeria airline operators as Afreximbank 

partners Russia on aircraft acquisition 

IFEOMA OKEKE 

Respite is finally here 

for airline operators as 

African Export Import 

Bank (Afreximbank) 

Wednesday partnered the 

Russian Export Centre to provide 

brand new aircraft for operations 

in Nigeria. 

This partnership is coming 

at a time airlines operators 

have struggled to pay 26 percent 

interest loan to banks to 

acquire new aircraft, and facing 

strenuous conditions from 

United States and European 

countries on aircraft leasing. 

Announcing the partnership 

in Lagos, Rene Awambeng, 

global head, client 

relations, Afreximbank, said 

the bank had entered into a 

strategic partnership with the 

Russian Export Centre, the 

export bank of the Russian 

Federation, to promote aviation 

in Africa, so that it could 

meet one of its strategic goals. 

The Russian aircraft type is 

the Sukhoi Superjet, a low cost 

Amid controversy, Lagos tells businesses to report ‘illegal billing’ on boreholes 

JOSHUA BASSEY 

Amid controversy 

and public outcry 

against its imposition 

of charges on 

borehole drilling in Lagos, 

the state government has 

asked residents and business 

organisations to report 

cases of ‘illegal billing’ or 

borehole closure by its officials. 

Babatunde Durosinmi- 

Etti, commissioner for the 

environment, at a meeting 

with heads of agencies 

and parastatals under 

his supervision, including 

Lagos State Water Regulatory 

Commission and Lagos 

Water Corporation, warned 

that the government would 

not allow the closure of any 

borehole, except where 

leaders need actionable and 

practical toolkits that would 

assist them to drive effectiveness, 

efficiency, innovation 

and lasting legacies. 

In a move to ensure businesses 

in Nigeria excel in 

these hard times and beyond, 

Texem UK Limited has developed 

an executive development 

programme titled 

“Building Successful Organisation 

that Endures: Aligning 

Purpose, Process, Performance 

and People”- a unique 

opportunity that executives 

cannot afford to miss. 

To gain insights on how to 

develop innovative, commercially 

valuable and sustainable 

competitive edge, Texem is 

inviting the world-renowned 

professor, Pawan Budhwar, 

editor-in-chief of British Academy 

of Management, and professor 

of Work Psychology at 

Aston Business School on May 

2 and 3, 2018, at Eko Hotel, 

Victoria Island Lagos. 

aircraft, a 100-seater aircraft, 

depending on the configuration, 

with enough legroom 

and Italian Style Interior. 

“The Russians have invested 

significant amount in 

research and development in 

their aircraft which are very 

efficient in terms of fuel consumption 

and are ecologically 

very friendly. 

“We have partnered with 

Russian Export Centre, to 

provide solutions so that African 

entrepreneurs either 

private sectors, national airlines, 

private sectors, operators 

of airlines can acquire 

these aircraft through asset 

structures to meet our objective 

of moving people 

from one part of the country 

to another,” Awambeng said. 

He explained that part 

of the partnership is to work 

with Nigerian authorities to 

certify the Russian aircraft to 

be able to operate in Nigeria, 

adding that the bank will enter 

commercial negotiations 

such was found to be contaminated 

and unfit for domestic 

use. 

It would be recalled that 

the Manufacturers Association 

of Nigeria (MAN) led by 

its president, Frank Jacobs, 

during a visit to Governor 

Akinwunmi Ambode in 

April 2017, raised the alarm 

over high charges placed on 

member companies by Lagos 

State Water Regulatory 

Commission on sinking of 

boreholes. 

Jacobs said: “We have received 

complaints from our 

members of charges up to 

N800,000 by the Lagos State 

Water Regulatory Commission. 

We are constrained 

to draw your attention to 

recent activities of the Lagos 

State water Regulatory 

Commission, on which we 

C002D5556 

BUSINESS DAY 

35 

NEWS 

Investors edgy as 10% rise in transaction 

fail to lift property prices in Q1’18 

CHUKA UROKO 

For investors in the 

Nigerian property 

market, it is not yet 

‘uhuru’ as property 

prices remain unchanged 

despite the slight 

improvement in the country’s 

macro-economic environment 

and an estimated 10 

percent rise in closed transactions 

at the end of the first 

quarter of this year (Q1 2018). 

Close market watchers 

note that the market has seen 

a significant change this year, 

as against what was seen in 

the second quarter of last 

year, although the change is 

still very gradual. “We can say 

that things have started getting 

better in terms of closing 

transactions, which can be 

measured,” Gbenga Olaniyan, 

CEO, Estate Links, said 

in an interview. 

The 13-month economic 

recession exited in Q2 2017 

dealt a devastating blow on 

real estate sector such that 

construction activities were 

paralysed; completed houses 

could not find buyers or tenants, 

and demand became 

flat with residential vacancy 

rate rising to almost 50 percent 

in the highbrow locations. 

Up till now, both residential 

and commercial property 

prices are still flat, which, 

analysts say, provides opportunity 

for home buyers, businesses, 

and investors that are 

patient and have long term 

view of the market to move 

cash to the market. 

This becomes all the more 

compelling considering that 

prices will surely go up, as 

many people are not building 

now and, according to 

Olaniyan, those who are doing 

developments are going 

to deliver at prices that will 

L-R: Hakeem Adeniji-Adele, chief technology officer, Microsoft Nigeria; Joel Ogunsola, executive director, Tech4Dev; Akin Banuso, 

general manager, Microsoft Nigeria; Olusegun Mimiko, former governor, Ondo State, and Ukinebo Dare, senior special adviser to 

the Edo State Governor on Skills and job creation, at the launch of the Basic Digital Education Initiative (BDEI) at the Microsoft 

Nigeria office, Lagos. 

have received numerous 

complaints and petitions 

from our members. 

“It is pertinent to draw 

your attention to the fact 

that there is no country in 

Africa and for that matter 

any state in Nigeria that is 

charging licensing fee for 

borehole or any charge for 

water abstraction. The association 

believes that the 

state has the responsibility 

to provide water for which 

the citizens would pay. 

“Companies are forced 

to provide their own water 

because of the inadequacy 

of public water supply. 

Asking companies to pay 

for this would appear that 

we are being penalised for 

making up for the inadequacy 

of government to 

provide this vital utility. 

… but analysts see prices rise as construction cost goes up 

IATA calls for greater cooperation on Africa aviation 

MIKE OCHONMA 

Collaboration between 

aviation 

stakeholders in Africa 

is essential if 

the sector is to realise its full 

potential and accelerate the 

development of the continent. 

This was the word of 

Raphael Kuuchi, International 

Air Transport Association 

(IATA) vice president, 

Africa, in his address to the 

African Airlines Association 

Aviation Stakeholders Convention 

in Zanzibar. 

“Over the next 20 years, 

air travel is forecast to grow 

at nearly 6 percent per year 

in Africa,” he highlighted, 

saying, “This represents significant 

opportunity. Fulfilling 

this potential will not 

reflect new market realities. 

Completed houses that 

came to the market a year 

ago at N50 million per unit, 

for instance, are still selling 

at that old price, but because 

construction costs keep rising 

despite the lull in the 

market, those that are being 

developed now will go for 

higher prices. 

“I see a situation where, 

because developments have 

slowed down, the economy 

is recovering, and money is 

trickling into people’s pockets, 

property prices which 

had been flat for so long, has 

to go up because a developer 

who borrows to build cannot 

sell at today’s price any longer,” 

Olaniyan said. 

It is expected, however, 

that with the economy starting 

to pick up, if in a whole 

week early last year sellers 

were getting three serious 

enquiries, they are sure to get 

10 this time around, though 

as it is now, a lot of the prospective 

tenants are still inspecting 

and raising funds, 

which raises hope that one 

day transaction will happen. 

One segment of the market 

where prospects are not 

so clear is retail, which was 

heavily impacted by the fall 

in the value of the naira. A 

retailer who was bringing 

in goods at $100 before the 

devaluation of the naira had 

N16,000 as his cost and so, he 

could sell what he brought in 

for N20,000. 

Now, if the same retailer 

brings in his goods 

at the same $100, his cost 

has moved from N16,000 to 

N36,000, but the buyers are 

not yet ready to pay N40,000 

and so, that poses challenges 

to him, leading to his decision 

to leave the mall. 

mentarily, the African Union 

recently also launched the 

Single African Air Transport 

Market, intended to bring 

the “Open Skies” concept to 

Africa and increase the continent’s 

air transport connectivity. 

In those other regions 

of the world in which 

Open Skies policies have 

been implemented, the results 

have been increased 

air traffic, economic growth 

and job creation 

“We expect no less in Africa. 

An IATA report indicates 

if just 12 key African countries 

opened their air transport 

markets, the increased 

connectivity would foster 155 

000 additional jobs and the 

creation of an extra $1.3-billion 

in annual GDP (gross 

domestic product) in those 

countries,” he affirmed.



C002D5556 

RESEARCH & 

INSIGHT 

A WEEKLY PUBLICATION OF BUSINESSDAY RESEARCH & INTELLIGENCE UNIT(BRIU) research@businessdayonline.com 08106395676 

Nigerian brewers: Battling for 

dominance in troubled terrain 

KELVIN UMWENI 

Nigeria, Africa’s economic 

powerhouse, is the second 

largest beer market 

in the continent. With an 

annual beer consumption 

of about 16 million hectolitres according 

to Morgan Stanley, a foremost 

investment firm, Nigeria’s per capita 

beer consumption is about 10 litres per 

annum compared to a global average 

of 35 – 40 litres. 

For more than two decades, the 

country’s brewery landscape has 

been dominated by Nigeria Breweries 

(NB), a subsidiary of Heineken, the 

Dutch brewery giant, and Guinness 

Nigeria Plc, a subsidiary of Diageo. 

Other brewers such as International 

Breweries, Intafact Brewery, Champions 

Brewery, and Pabod Brewery 

are also looking to have a share of the 

industry’s action. 

The combined market capitalization 

of NB, Guinness and International 

Breweries on the Nigeria Stock 

Exchange (NSE) as at 9th April 2018 

stood at N1,678 billion. 

The push for Brand Presence: riding 

the boat of Marketing Expenses 

Performance in the brewery industry 

has mirrored occurrences in the 

macroeconomic space. For instance, 

the recession that hit the country 

in 2016 had a debilitating hit on the 

brewery industry as the ensuing liquidity 

crunch led to sharp drop in the 

disposable income of consumers who 

reduced patronage for their favourite 

beer brands, or shifted their love to 

more pocket-friendly substitutes. 

Following the exit of the country’s 

economy from recession in second 

quarters of 2017, brewers intensified 

their scramble for consumers’ loyalty 

and increased market visibility via 

strong marketing campaigns and 

expanded distribution outlets. 

In 2017 alone, a total of N97.3 

billion was spent on marketing and 

distribution by the three major brewers; 

this amount was 8.4 per cent more 

than the N89.8 billion the brewers 

expended in the preceding year. While 

Nigeria Breweries spent 19.4 per cent 

of total revenue (N66.9 billion) on 

marketing and distribution expenses, 

Guinness Plc. spent N25.3billion, 20 

per cent of total revenue. 

To further deepen market penetration 

through increased distribution 

channels, Guinness added 5 more 

outlets, bringing their distribution 

outlets to 66 at year end 2017. 

International Breweries also increased 

their marketing and distribution 

expenses from N3.4 billion in 

2016 to N5.1 billion in 2017; this represented 

15.6 per cent of total revenue 

earned for the period under review. 

Who is winning the battle for 

market share? 

A report published in December 

2017 by the BRIU titled “The Nigeria 

Brewery Industry Snapshot”, noted 

that the industry has revealed a somewhat 

zero-sum scenario in the last five 

years, as Nigerian Breweries (NB) has 

continued to grow market share each 

year. On the other hand, Guinness 

recorded shrinking market share as 

International Breweries trailed behind 

them. 

According to BRIU analysis, NB 

shed 3 percentage points as its market 

share declined from 71.5 per cent in 

2016 to 68.5 per cent in 2017, suggesting 

a waning position as the undisputed 

industry leader. Guinness Nigeria’s 

market share was 25 per cent in 2017 

compared to 23.2 per cent in 2016, 

while that for AB InBev’s International 

Brewery stood at 6.5 per cent, up 1.2 

percentage points relative to 2016. 

Revenue Profile of Brewers 

The available financial metrics put NB 

way ahead of its rivals. The revenue figure 

for NB Plc. at year end 2017 stood 

at N344,563 million, up by 9.8 per cent 

to N313,743 million in the preceding 

financial year. This is attributable to increased 

sales volume in the economy 

or value brands. 

Expenses propped up Year-on-Year 

(YoY) by 10.8 per cent to N289,660 

million compared to N261,456 million 

in 2016. The expansion in expenses 

account of NB was majorly due to an 

increase in the cost of raw materials 

and consumables which spiked by 

13.4 per cent to N128,857 million in 

2017. 

Most of the raw materials and 

consumables such as barley and 

sorghums needed for the running of 

breweries are sourced internally with 

attendant price increase shooting 

up cost. 

According to Beverage Industry 

News, an indigenous online repository 

of trade news about the Nigerian 

beverage industry, NB aims to source 

60 per cent of its raw materials locally 

by 2020 in a strategic move to boost 

local raw material production and 

more importantly reduce the volume 

and bourgeoning value of imported 

raw materials. 

Guinness Nigeria rebounded 

with a YoY revenue growth of 23.5 per 

cent from N101,973 million in 2016 to 

N125,919 million in 2017. The year was 

equally a cheerful one for the brewer 

after it posted a profit after tax of N1,923 

million following a loss of N2,015 million 

a in 2016. 

International breweries equally had 

a stellar performance with a bourgeoning 

revenue of N32,711 billion in 2017 

compared to N23,269 billion in 2016. 

At year-end 2017, the earnings per 

share (EPS) of NB hit N4.13k from 

N3.58k in 2016 indicating that the 

company is making more profit per its 

outstanding common stock. Guinness 

on the other hand has an EPS of N1.28k, 

up from a negative N1.34k in 2016. 

International brewery’s EPS decline 

to 31k from 81k in the preceding year. 

. . . As AB InBev’s attempts uncommon 

disruption 

AB InBev seeks to seize the greatest 

share of the industry and end Nigeria 

Breweries’ close-to-a-decade industry 

dominance. With the recent merger 

of International, Intafact and Pabod 

breweries under the trading name 

of “International Brewery Plc”, the 

world’s largest brewer who eventually 

became the indirect parent company 

of the three aforementioned brewers, 

is almost certain to achieve its aim. 

Prior to AB Inbev takeover of the 

three Nigerian brewers, SABMiller 

was the parent company of International 

Breweries, intafact Breweries, 

and Pabod breweries. According to 

Chukwu, the consolidation is to allow 

for operational efficiency, which 

is expected to increase AB InBev’s 

profitability in the industry. 

Global brands as weapons of 

market control 

In the fight for increased market presence, 

the brewers introduced new 

internationally recognized brands 

their respective parent companies. 

In December 2017 for instance, NB 

introduced the Stellar Beer, a global 

brand of Heineken. 

“This had an encouraging initial 

feedback,” affirmed NB management. 

Guinness on its part equally 

commissioned a £12million production 

line in its Benin plant for local 

production of some of Diageo’s international 

brands such as McDowell’s 

VSOP, Smirnoff X1 Intense Chocolate 

Vodka, and Gordon’s Dry Gin. 

Aside the multi-million dollar 

plant they are currently constructing 

in Sagamu, Ogun state, Anheuser- 

Busch (AB) InBev (which recently 

acquired Internatiuonal Brewery), 

plans to hit the Nigerian beer market 

soon with its two major global brands: 

Budweiser and Beck’s. 

The introduction of Budweiser and 

Beck’s will set off a competition in the 

high end of the market in which NB’s 

Heineken and Guinness’s Foreign Extra 

Stout already hold sway. 

“One in almost every five beers 

sold in the United States today is a 

Budweiser,” RateBeer.com, an online 

beer-rating site said. 

Analysts expect that this will have 

far-reaching effects on the scramble 

for dominance given its popularity in 

its present market. 

“Budweiser will definitely have a 

market for itself in Nigeria and may aid 

AB InBev to chop off a sizable market 

share for itself” affirmed Johnson 

Chukwu, Managing Director of Cowry 

Asset Management who spoke to Businessday 

Research and Intelligence Unit 

(BRIU) via telephone. 

Similarly, Beck’s is the world’s number 

one German brand with presence 

in over 85 countries. 

Considering that Nigerians always 

like to try out new things, especially 

one with international affiliation, and 

given the instability in consumers’ 

disposable income, the stage appears 

set for a fierce fight by the brewery giants 

in 2018.


BusinessDay launches TV app 

BusinessDay videos 

are now available 

to smartphone users 

with the launch 

of the BusinessDay TV 

App. The app is available to 

download from Google Play 

Store. 

The app shows the latest 

BusinessDay videos, including 

high-quality analysis 

and coverage of the leading 

stories and issues in politics, 

business and finance. It 

also broadcasts culture and 

lifestyle features and a text 

scroller of the latest BusinessDay 

news headlines. 

According to Frank Aigbogun, 

publisher of BusinessDay, 

“We see great demand 

for our video content 

on Businessdayonline.com, 

YouTube and through our 

mobile apps – video views 

in 2017 were up 11 percent. 

Mobile app extends our 

journalism to the ‘digital 

living room,’ further demonstrating 

our commitment 

LCCI celebrates business excellence at 

2018 commerce, industry awards 

Lagos Chamber of Commerce 

and Industry 

(LCCI) has concluded 

plans to honour excellence 

in business at its 2018 

Commerce/Industry Awards 

holding May 1, in Lagos. 

This year’s edition, the 

fifth in the series, promises to 

be an improved edition and 

hopes to attract major players 

in the various sectors of 

the Nigerian economy. 

Muda Yusuf, director-general, 

LCCI, said: “The objective 

of the annual awards is to recognise, 

celebrate and promote 

private and public institutions 

that have exhibited the core 

values of best business practices, 

growth through innovations, 

business sustainability 

and have positively impacted 

the society.” 

Yusuf said, “The LCCI 

Commerce and Industry 

Awards prides itself as a cred- 

Obaseki okays construction of 60 roads, 

Amagba Road for reconstruction 

Edo State governor, 

Godwin Obaseki, 

has approved the 

construction of 60 

roads across the state’s 18 

local government areas 

(LGAs), to bring development 

closer to the people 

and open up rural communities 

for business activities. 

Obaseki said infrastructural 

development being 

pursued by the government 

would engender job creation 

and poverty alleviation, 

as 7,000 youths would be engaged 

during the road construction. 

Obaseki, who was represented 

by his chief of staff, 

Taiwo Akerele, during the 

inspection of ongoing road 

construction at Ogunmwenyin 

community, Lucky 

Way, Osayande Ize-Iyamu 

Drive and Nneka Street in 

to subscribers by delivering 

content through new 

channels. We’re delighted 

to partner with Kalibrate 

Africa to bring BusinessDay 

videos to a wider audience.” 

Hercules Venter, Kalibrate 

Africa, co-founder, 

said, “There is no doubt 

about the role that video 

content plays in our lives 

today. However, the major 

change is actually reflected 

in the means to distribute 

it.” 

The app is available 

to download from Google 

Play Store and access 

via Progressive Web App 

direct on mobile, tablet, 

or desktop at https:// 

tv.businessdayonline.com. 

“Progressive Web Apps 

are multi-platform. They 

adapt perfectly to any 

screen they’re used on mobile, 

tablet, or desktop. They 

are just as good in terms of 

design as they are in features.” 

ible platform where winners 

emerge through a painstaking 

selection process supported 

by robust research 

and market intelligence. 

Some of the awards categories 

to be won at the prestigious 

event include: Award 

for Excellence in sectors of 

the economy such as Banking, 

Insurance, Health Care, 

Manufacturing, Real Estate, 

Aviation, Pharmaceuticals, 

Education, Media among 

others. 

“The LCCI aims to celebrate 

deserving corporate 

organisations and public 

institutions that have made 

remarkable contribution to 

the development of commerce 

and industry, and 

the economy at large. Good 

corporate governance is 

also a major consideration 

in the evaluation of nominees 

for the award.” 

Ugbor Village, said, “The 

roads to be constructed are 

semi-rural/urban roads, 

ranging from 1 to 1.5 kilometres. 

The effort is geared towards 

deepening the spread 

of economic enablers to engender 

development.” 

The inspection train also 

got to Amagba Community, 

where the governor assured 

of the re-construction of 

the road, noting, “We don’t 

talk too much but we assure 

you that the construction 

of Amagba Road will commence 

soon.” 

He said, “In road construction, 

there are procurement 

processes and procedures 

that are involved and 

must be followed. By the 

time these processes and 

procedures are completely 

addressed, the construction 

of other roads will com- 

C002D5556 

BUSINESS DAY 

37 

NEWS 

US calls for greater push in entrepreneurship, 

sees bright future for Nigeria 


United States of 

America says Nigeria 

future is bright, 

and has called for 

greater push in the direction 

of entrepreneurship. This is 

as the US Consulate General 

in Nigeria says only Nigerians 

possess the answers they seek 

in the nation’s problems. 

These were the highlights 

at the opening ceremony of 

a two-day entrepreneurship 

academy in Port Harcourt, 

Rivers State, held at the Institute 

of Petroleum Studies 

(IPS) in the University of Port 

Harcourt by the US Consul- 

General’s office in Lagos, in 

collaboration with Field of 

Skills and Dreams (FSD) VTE 

Academy, which began on 

Tuesday. 

In her welcome remarks 

to usher in the Consul-General, 

Darcy Zotter, the direc- 

tor of public affairs section 

of the US Consulate General 

in Lagos, sent the eager entrepreneurs 

on cloud nine 

when she said, “The future of 

Nigeria is utmost. People talk 

of so many problems, power, 

insecurity, education, poverty, 

jobs, etc, but does that 

mean Nigeria has no future? 

We firmly believe that with 

the right tools, Nigeria has a 

bright future.” 

Zotter went on: “With 

trained entrepreneurs, Nigeria 

has a great future. The 

result of the first workshop in 

Lagos shows it. The US wants 

to build wealth creators; we 

say, look upon entrepreneurship, 

not always focusing on 

the negatives such as insecurity, 

Boko Haram, power 

failures, education problems, 

you know them. 

“Let Nigerian youths look 

for solutions and answers; 

you have the answers. If you 

L-R: Rotimi Fadipe, supply chain director, Honeywell Flour Mills Plc; Salim Saleh Muhammad, national president, Wheat Farmers 

Association of Nigeria (WFAN); Thabo Mabe, group managing director, Dangote Flour Mills plc; Paul Gbededo, group managing 

director, Flour Mills of Nigeria plc, and Bolaji Anifowose, commercial director, Ola Grains, during the unveiling and presentation 

of multi-crop Threshers to the Wheat Farmers Association of Nigeria, in Lagos. 

Pic by Olawale Amoo 

mence as contractors will be 

mobilised to site.” 

The governor explained 

that the focus on constructing 

rural roads was to open new 

areas for enhanced economic 

activity and improved livelihoods 

for the people, especially 

agrarian communities, 

from whence people need to 

move agro-produce to cities. 

“The road construction 

will reduce the level of poverty 

in rural areas as the construction 

of roads will open the 

areas for economic activities. 

The roads to be constructed 

will open up communities 

outside the state capital to development,” 

he said. 

He said the inspection 

exercise was to ensure that 

contractors handling the projects 

work in accordance with 

specification for the projects, 

adding, 

Edo assures of robust healthcare ecosystem with 

insurance scheme, 500 primary, super tertiary centres 

As the Edo State government 

intensifies 

work on the reform 

of the health sector, 

the governor, Godwin 

Obaseki, has said the soonto-be-unveiled 

state health 

insurance scheme and construction 

of 500 primary 

healthcare centres (PHCs) 

across the state will guarantee 

accessible and affordable 

healthcare. 

The governor said there iwa 

a nexus between the health 

insurance scheme and the 

PHCs, as the symbiotic relationship 

would ensure health 

needs were met with minimal 

cost and effort, across the different 

parts of the state. 

He stressed that the revamp 

of the healthcare sector is on 

course and that government 

will ensure that relevant institutions 

and policies are put in 

place to drive the reforms and 

sustain gains to be recorded. 

ask me for solutions to Nigeria, 

I will say, I do not know; 

you have the answers. There 

is no need to run to anywhere 

else for answers; the US can 

only help to create the platforms 

but you have to have 

the answers.” 

The CG who declared the 

workshop open explained 

that one of the primary goals 

of the US Mission in Nigeria 

is to support Nigeria’s economic 

development. 

In the Consul-General 

welcoming remarks, F. John 

Bray, said one of US Mission 

Nigeria’s primary goals was 

to support Nigeria’s economic 

development. 

According to Bray, the 

US Department of State supports 

entrepreneurs all over 

the world through training 

and mentoring, while also 

working with governments 

to create enabling environments 

and entrepreneurial 

According to Obaseki, “we 

are undertaking a holistic 

revamp of the health sector 

to ensure that the people are 

best served and that they do 

not have to spend so much 

to get quality healthcare. All 

of these reforms are interconnected 

and we are doing this 

because we have a big plan; 

we won’t do things in tokens. 

“Every aspect of the health 

sector is covered. So, much 

as our focus is on primary 

healthcare, we are not oblivious 

of the need for tertiary 

and specialist care. So, all of 

these are captured in the reforms 

we are pursuing.” 

The governor said that the 

focus on primary healthcare 

is responsible for the construction 

of the 500 Primary 

Healthcare Centres (PHC) 

across the state, noting that 

the state government intends 

to work with the Federal Ministry 

of Health through the 

cultures. 

He said, “There is growing 

evidence that entrepreneurs 

the world over are the drivers 

of job growth. The United 

States government is firmly 

convinced that in addition to 

creating jobs and expanding 

economic opportunities, entrepreneurship 

contributes 

to political stability and a vibrant 

civil society.” 

He said 75 percent of the 

16 million businesses in the 

US were owned by individuals 

(entrepreneurs). 

Leading business leaders 

including Sahara Group cofounder, 

Tonye Cole, Emzor 

Pharmaceutical CEO, Stella 

Okoli, Andela co-founder, 

Iyin Aboyeji, award-winning 

designer, Zizi Cardow, and 

senior executives of prominent 

commercial banks 

mentored and trained the 

participating young entrepreneurs. 

National Primary Healthcare 

Development Agency (NPH- 

DA) in addressing challenges 

facing primary health care 

system in the state. 

“The 500 PHCs will cater to 

the health care need of those 

in rural areas, contribute 

to strengthening the state’s 

healthcare sector and engender 

speedy response to health 

emergencies.” 

He added that the primary 

health insurance scheme, 

the legislation for which has 

reached advanced stage at 

the Edo State House of Assembly, 

would bring succour 

to our people. 

“It is a scheme that will 

be open to all Edo people, as 

against being just for civil servants. 

This scheme will ensure 

that people access health care 

with minimal cost and even 

when they get to the health 

centres, they would be assured 

of quality health care,” he said.


C002D5556 


NEWS 

Nigeria’s fiscal space gets boost as oil hits 4 year... 


FG extends VAIDS to June... 


taxpayers.” 

The President however 

warned that no further extension 

of time will be approved 

after June 30. 

The President added that a 

new date was also given, based on 

the conviction of the Ministry of 

Finance that the overall objective 

to increase compliance will be 

attained, and additional revenue 

will accrue. 

The statement also said that a 

fresh Executive Order will be made 

to give legal backing to the new 

timeline. 

According to Buhari, “for a nation 

of people who are competitive 

driven it is not a thing of pride that 

we are the lowest performer in tax 

to GDP, not just in Africa, but in 

the world.” 

“Hiding monies overseas, evading 

taxes by manipulation, and 

other unwholesome practices, 

have never developed a country, 

and for Nigeria to attain her true 

potential, these must stop.” 

Nigeria’s tax-to-Gross Domestic 

Product (GDP) ratio at just 

6percent is one of the lowest in 

the world compared to India (16 

supply from the Middle East in 

the near future, which is affecting 

the price of crude oil,” Afimia said 

by mail. 

The global oil marker rose as 

much as 3.9 per cent to $71.34 a 

barrel, blowing past its recent January 

peaks to reach a level last seen 

in December 2014. The change 

marks the biggest one day gain for 

the gauge since September. 

“The higher crude oil prices we 

are currently witnessing simply 

means more income for both 

OPEC and non OPEC producing 

countries which they should take 

advantage of,” Abayomi Fawehinmi, 

an energy analyst at a Lagosbased 

consulting firm said. 

The West Texas Intermediate 

benchmark advanced as much as 

3.8 per cent to $65.84 a barrel, closing 

in on its recent January high of 

$66.66 a barrel. 

“Also, the Middle East has the 

highest concentration of the major 

oil producing countries, so any issues 

or tensions there will affect oil 

supply,” Fawehinmi said. 

Prices have firmed on escalating 

tensions in the Middle East as US 

President Donald Trump and its allies 

are considering military response 

against Syrian President Bashar 

Assad’s forces over alleged chemical 

weapons attack in western Syria. 

Also, France, Britain and Middle 

Eastern allies, including Saudi Arabia, 

have publicly acknowledged 

internal deliberations on how to 

address the suspected poison gas 

on Saturday in the rebel-held western 

Syrian city of Douma, which 

the Syrian American Medical Society 

has said killed over 48 people. 

Syria is not a major oil producer 

itself, however the wider Middle 

East region is the world’s most 

important crude exporter and 

tension in the region tends to put 

oil markets on edge. 

“Russia vows to shoot down any 

and all missiles fired at Syria. Get 

ready Russia, because they will be 

coming nice and new and “smart”. 

You shouldn’t be partners with 

a Gas killing Animal who kills his 

people and enjoy it,” Trump tweeted 

on Wednesday by 11.57 am. 

Russia and Syria swiftly reacted 

to Trump’s threat on Wednesday. 

Syria’s Foreign Ministry said it 

was not startled by the US’ “reckless 

escalation” via Trump’s tweets, the 

state-run news agency SANA reported, 

while Russian Foreign Ministry 

spokeswoman Maria Zakharova said 

in a Facebook post that “smart missiles 

should fly toward terrorists, not 

the legal government that has been 

fighting international terrorism for 

several years on its territory.” 

There are also concerns that the 

US could renew sanctions against 

Iran, a major Middle East oil producer 

with daily oil production of 

about 3.8 million barrels. 

Saudi Arabia’s foreign minister 

Adel al-Jubeir said on Tuesday it was 

uncertain whether talks concerning 

Europeans and the United States 

would be sufficient to fix the Iran 

nuclear deal’s flaws, and that Tehran’s 

“vision of darkness” had to be stopped. 

U.S. President Donald Trump gave 

an ultimatum to the European powers 

on January. 12, saying they must 

agree to “fix the terrible flaws” of the 

2015 agreement or he would refuse to 

L-R: Segun Oloketuyi, MD/CEO, Wema Bank plc; Yinka Davies, legendary entertainment personality; Joseph Edgar, 

producer of widely acclaimed stage play Isale Eko; Ademola Adebise, deputy managing director, Wema Bank plc, 

and Moruf Oseni, executive director, retail bank, Wema Bank plc, at the Wema Bank head office in Marina, when the 

production crew of Isale Eko paid the bank’s management a courtesy visit. 

percent), Ghana (15.9 percent), 

and South Africa (27 percent). Most 

developed nations have tax-to- 

GDP ratios of between 32 percent 

and 35 percent. 

The International Monetary 

Fund (IMF) in a recent country 

report on Nigeria blamed the nation’s 

revenue administrators for 

the low tax collection in Africa’s 

largest economy. 

“The very low tax collection 

rates in Nigeria are a direct reflection 

of weaknesses in revenue 

administration systems and a high 

level of systemic noncompliance,” 

the IMF noted. 

“Estimates of tax potential from 

the literature suggest that a nonoil 

tax capacity of 16 to 18 percent 

would be optimal for a country 

with Nigeria’s economic structure 

and per capita income levels. This 

estimate implies space for additional 

tax collection of 12 percent 

of GDP.” 

The Voluntary Asset and 

Income Declaration Scheme 

(VAIDS) is a time-limited opportunity 

for taxpayers to regularise 

their tax status relating to 

previous tax periods and pay any 

taxes due. 

The Federal Government aims 

extend the U.S. sanctions relief on Iran. 

Speaking to reporters after talks in 

Paris, Foreign Minister Adel al-Jubeir 

said he believed France, Britain and 

Germany agreed that Iran’s ballistic 

missile program and regional activities 

had to be addressed, but they 

disagreed with the United States, 

Saudi Arabia and Israel on the need 

to revamp the accord. 

“The present US government 

is currently showing the world 

that it’s not a country that honours 

agreement, so it won’t be a surprise 

if they don’t honour the agreement 

which will likely increase the price 

of oil,” Luqman Agboola, head of 

research at Sofidam Capital said. 

Saudi Arabia Energy Minister 

Khalid al-Falih said on Wednesday 

that Saudi Arabia will not allow 

another supply glut, meaning that 

the de-facto leader of Organization 

of the Petroleum Exporting 

Countries (OPEC) would continue 

to suppress supply. 

Also, US crude inventories rose 

by 1.8 million barrels in the week to 

April 6 to 429.1 million, according to 

a report by the American Petroleum 

Institute (API) on Tuesday, compared 

with analysts’ expectations 

for a decrease of 189,000 barrels. 

to raise at least $1 billion into its 

coffers as tax revenue while bringing 

in 4 million new tax payers into 

the tax net. 

Aso Rock had engaged a leading 

international Asset Tracing and Investigation 

Agency (Kroll), to trace 

and track illicit flows and assets. 

The data mining efforts of the 

Federal Ministry of Finance domiciled 

in ‘Project Lighthouse’ is 

also meant to help identify a new 

batch of more than 130,000 high 

net worth Nigerian individuals and 

companies that have potential tax 

underpayments. 

“We have properties worth N2 

trillion belonging to Corporate 

entities that do not pay tax and we 

have begun the process of selling 

them off. At the federal level, about 

N20 billion has been raised and 

we have received over 262 applications 

through VAIDS,” said Tunde 

Fowler, Executive Chairman, 

Federal Inland Revenue Service 

(FIRS). 

“We are compiling all the information 

and data so we can 

have a central data base to ensure 

adequate security for people’s 

information,” Fowler said. 

Tax authorities have collected 

data from a number of sources including 

land registries of the Governments 

of Lagos, Kaduna, Kano and 

Adding to rising storage levels, 

the US Energy Information 

Administration said on Tuesday 

that it expects domestic crude oil 

production in 2019 to rise by more 

than previously expected, driven 

largely by growing US shale output. 

In its monthly short-term energy 

outlook, the agency forecast 

that US crude oil output will rise 

by 750,000 barrels per day (bpd) to 

11.44 million bpd next year. 

Last month, it expected a 

570,000-bpd year-over-year increase 

to 11.27 million bpd. 

That will likely make the US the 

world’s biggest oil producer by 2019, 

surpassing Russia which currently 

pumps out almost 11 million bpd. 

Rising oil prices would be welcome 

by the cash strapped Muhammadu 

Buhari-led government which 

campaigned in 2015 on the bases of 

stopping all forms of subsidy payments 

on petroleum products but 

has however been secretly doling out 

billions of naira annually as subsidy 

under the disguise of “underecovery” 

on petrol alone to oil contractors 

and their cronies in the NNPC. 

•Continues online at www.businessdayonline.com 

Ogun States as well as the Federal 

Capital Territory (FCT) and also have 

been able to request and receive data 

from a number of nations including 

traditional tax havens. 

For the overseas data the Federal 

Government has used exchange 

of information protocols. Under 

these protocols, information relating 

to bank records and financial 

filings for tax purposes is obtained 

from tax havens like British Virgin 

Islands and Mauritius that are 

signatories to information sharing 

agreements. 

The FIRS has also been unearthing 

tax payer’s data using Bank Verification 

Number (BVN), foreign exchange 

(FX) application, land registry, 

company dividends, car registration, 

Corporate Affairs Commission, and 

foreign property ownership. 

“The focus right now is on those 

that make substantive amount in 

Nigeria that have not declared or 

are underpaying their taxes,” according 

to the FIRS chairman. 

Nigeria has signed the Multilateral 

Competent Authority on Common 

Reporting Standards, which 

allows for exchange of financial 

account information. 

“We need to stop relying on oil 

and rebuild our revenue base. In 

order to achieve this we have to 

fulfill our tax obligations. This is 

Buhari meets... 


Gadaffi of Libya. When he was 

killed, the gunmen escaped with 

their arms. We encountered some 

of them fighting with Boko Haram. 

Herdsmen that we used to know 

carried only sticks and maybe a cutlass 

to clear the way, but these ones 

now carry sophisticated weapons. 

The problem is not religious, but 

sociological and economic. But we 

are working on solutions.” 

President Buhari lamented that 

“irresponsible politics” has been 

brought into the farmers/herders’ 

crisis, but assured that enduring 

solutions would be found, and 

justice done to all concerned. 

On Leah Sharibu, the schoolgirl 

from Dapchi still being held by 

insurgents, reportedly because she 

refused to renounce her Christian 

faith, the President said: 

“We are managing the matter 

quietly. Making noise would not 

help. We are collecting as much 

intelligence as possible, working 

with the Red Cross and other international 

organizations. There 

are too many fraudulent people 

around, who claim they can do this 

and that. We won’t deal with them. 

That was how we got the Dapchi 

girls back, and the Chibok girls.” 

Archbishop Welby said it was 

always a delight to see President 

Buhari, “whom I have tremendous 

respect for,” adding: “You have my 

best wishes on your recent decision. 

I read your declaration speech. We 

are neutral as a church, but we will 

pray for you. Great statesmen are 

those who run for the good of their 

country. We will be praying for you.” 

Japaul losses hit... 


interest expense spiked by 118.01 

percent to N4.61 billion in December 

2017 from N2.11 billion as at 

December 2016. 

The company’s share price 

gained 7.55 percent to close at 57 

kobo per share while market capitalization 

stood at N3.57 billion. 

Japaul Oil & Maritime Services 

Plc provides marine offshore construction, 

marine equipment leasing, 

and oilfield marine support 

services. 

something we must all get right,” 

said Kemi Adeosun, Nigeria’s Minister 

of Finance. 

The President urged Nigerian 

companies and individuals to 

join government in the rebuilding 

mission, “and do the right thing by 

taking this window of extension to 

regularize.” 

He added that the right thing 

may not be convenient or comfortable, 

“but in the long run, we will all 

have a nation we can be proud of.” 

President Buhari further urged 

tax authorities to use the extension 

window to perfect plans to prosecute 

those who fail to regularize 

their tax status. 

President Buhari had last year 

launched the Economic Recovery 

and Growth Plan (ERGP), and the 

VAIDS tax amnesty a first in the 

series of reforms that will transform 

the tax system and provide sustainable 

predictable funding for all tiers 

of government. 

The IMF however says the 

current strategy of relying on 

strengthened collection efforts 

and one-off initiatives such as 

the Nigerian Voluntary Asset 

and Income Declaration Scheme 

(VAIDS) as a first level intervention, 

“may not be that effective in 

delivering higher revenues in a 

sustainable manner.”


FRSC calls spare parts dealers for 

collaboration on safety in Anambra 

Spare parts dealers in 

Anambra State have 

been advised to support 

the campaign for 

enhanced motor traffic safety 

on Nigeria roads. 

Sunday Ajayi, sector commander, 

Federal Road Safety 

Corps (FRSC), Anambra, gave 

the advice at the New Spare 

Parts Market in Nkpor, Idemili 

Local Government Area, Anambra 

State, on Wednesday. 

Ajayi, who addressed the 

traders during safety campaign 

tour, said spare parts 

dealers are critical stakeholders 

in ensuring safety on the 

nation’s roads. 

The FRSC official attributed 

usage of fake spare parts 

as factors that causes most 

vehicular accidents, said if 

dealers would insist in selling 

genuine parts the accident 

rates would reduce. 

He said the agency would 

extend the campaign to 

other major stakeholders in 

the state to sensitise them 

Buhari must follow due process on 

$1bn security fund - Reps scribe 

KEHINDE AKINTOLA, Abuja 

House of Representatives 

has called 

on President Muhammadu 

Buhari 

to follow due process before 

drawing down the $1 billion 

security fund from Excess 

Crude Account (ECA). 

Abdulrasak Namdas, 

chairman, House Committee 

on Media and Public Affairs, 

gave the House position in 

an interview with Legislative 

correspondents in Abuja. 

Namdas (APC-Adamawa) 

said the National 

Assembly was yet to give any 

approval of $1 billion from 

the ECA to fight insurgency. 

He maintained that the 

normal practise in Nigeria is 

that any amount to be withdrawn 

from the federation 

account must have approval 

National Assembly to make public its l2018 

budget, increase public trust 

KEHINDE AKINTOLA, Abuja 

Leader of the Senate, 

Ahmad Lawan on 

Wednesday, reiterated 

the resolve of the 

National Assembly towards 

making public its 2018 budget 

in line with the provision of 

Freedom of Information Act. 

According to the timeline 

scheduled by the leadership 

of the Senate and House of 

Representatives, the report of 

the 2018 budget is expected 

to be laid other floor of both 

Chambers on Thursday, April 

19, 2018 and passed on Tuesday, 

April 24, 2018. 

Lawan (APC- gave the assurance 

during a press briefing 

on the forthcoming National 

Assembly Open Week, 

scheduled to hold between 

25th to 29th June, 2018 at the 

premises of the National Ason 

the need to key into the 

campaign. 

Ajayi noted that if stakeholders 

collaborate and 

check factors that promote 

road accidents, the country 

would be better for it, 

and appealed to leadership 

of the traders to key to the 

commission’s drive of flushing 

out fake spare parts dealers 

in markets across the 

state. 

The FRSC official also educated 

the participants on the 

need to heed to safety rules 

and obey other necessary 

safety codes while driving. 

The sector commander 

urged vehicle owners to first 

go to driving schools before 

driving, as most of the accidents 

on the roads were manmade 

and avoidable. 

Chairman of the traders 

union, Aloysius Ozokwelu, 

commended the sector commander 

for the enlightenment 

and education of his 

members. 

from the National Assembly. 

“We are hoping that this 

will be brought before us 

before any amount is withdrawn. 

Although from the 

presidency we have heard 

some explanations that the 

president has not approved. 

“What we have been 

told is that the National 

Executive Council (NEC) 

has given its tacit approval 

and that it will still come to 

the National Assembly. But 

until we approve, no single 

amount can be taken from 

that account,” the Adamawa 

lawmaker said. 

In a separate interview 

with BusinessDay, Pally Iriase, 

Majority Deputy Chief 

Whip expressed optimism 

that the Executive will transmit 

the request on the $1 billion 

security fund to the National 

Assembly. 

sembly complex, Abuja. 

Some of the activities 

scheduled for the four-day 

event are: interactive session 

with the Executive arm 

of government on the Economic 

Recovery and Growth 

Plan (ERGP); interactive session 

with Judiciary arm of 

government on pre and post 

elections adjudication and 

constitutional separation of 

powers; interactive session 

with trade unions on economic 

growth and industrial 

relations; interactive session 

with traditional rulers and 

pressure groups and interactive 

session with civil society 

organisations on accountability 

and service delivery in 

governance as well as interactive 

session with women, 

youth and student groups. 

Lawan explained that the 

Open Week was aimed at 

C002D5556 

BUSINESS DAY 

39 

NEWS 

L-R: Aillen Allkins, corporate vice president, Microsoft; Hakeem Fahm, commissioner for science and technology, Lagos State; 

Akin Banuso, GM, Microsoft Nigeria; Yaniv Natan, founder, Tek Experts, and Olawole Familoni, deputy vice chancellor, University 

of Lagos, during the official opening ceremony of Tek Experts office in Lagos. 

Pic by Pius Okeosisi 

FEC approves N61.4bn contracts 


in Plateau State for the construction 

of 44.625 kilometres 

for N19.392 billion, the 81km 

As part of efforts 

to improve infrastructure 

across 

the country, Federal 

Executive 

Council (FEC) has approved 

various contracts worth N61.4 

billion. 

The dredging of the Escavos 

and Warri Seaport as well 

as replacement of the bad 

navigational aids at the port 

took the biggest chunk of the 

approvals at N13 billion. 

Ministers of power, works 

and housing, Babatunde Fashola, 

interior, Abdulrahman 

Danbazzau, education, Adamu 

Adamu, water resources, 

Suleiman Adamu, and transportation, 

Rotimi Amaechi, 

took turns to explain their 

ministries’ memos while 

briefing State House correspondents 

after the meeting 

presided over by Vice President 

Yemi Osinbajo. 

Fashola said the FEC also 

approved contracts for the 

Baban Lamba-Sharam Road 

fostering public perception 

and involvement in political 

dialogue and ensure greater 

public trust in governance. 

He maintained that Nigerian 

citizens have every right 

to understand the operations 

of the Legislature by promoting 

transparency and accountability. 

“Many Parliaments, including 

the National Assembly, 

are increasingly providing 

the pubic with information on 

their budgets, expenditures 

and financial activities. 

“Thirdly, parliamentary 

openness has also taken the 

form of direct engagement 

within the policy making 

process by providing citizens 

access to information about 

the laws under consideration, 

as well as opportunities 

to influence legislative deliberations. 

Lagos-Ota-Abeokuta road, 

which contract variation was 

approved from the initial N22 

billion to N56.7 billion, and 

the Port Harcourt end of the 

Enugu to Port Harcourt road, 

which was awarded at the 

cost of N6.03 billion. 

According to Fashola, 

We will resist attempt to lift ban on Oando shares, shareholders tell SEC 

Group of shareholders 

under 

the aegis of the 

Proactive Shareholders 

Association of Nigeria 

(PROSAN), Trusted 

Shareholders Association 

of Nigeria (TSAN) and the 

Oando Shareholders Solidarity 

Group (OSSG), have 

threatened to take legal action 

if the Securities and Exchange 

Commission (SEC) 

and the Nigerian Stock Exchange 

(NSE), lift the suspension 

on sale of Oando 

shares on NSE floor. 

Leaders of the groups, 

who on Wednesday made 

their position known to the 

press in Lagos, faulted SEC’s 

claim of carrying out forensic 

audit of Oando plc, and 

accused the commission of 

not doing anything tangible 

on the issue. 

Clement Ebitimi, coordinator 

of OSSG, who vowed 

that his group would in- 

“The Lagos-Ota-Abeokuta 

road was first awarded in year 

2000, and it has since been left 

uncompleted because they 

was no budgetary provisions 

for it. 

“This administration in 

trying to move this contractor 

to site stated the revision 

of the rate. So the revised rate 

were brought to council today 

and a revision of N22 billion 

was approved for the 81 kilometres 

road, bringing the total 

contract price to N56.701 

billion. 

“The third approval was for 

the section four of the Enugu 

Port Harcourt Road, the part 

between Abia and Port Harcourt, 

particularly in Port Harcourt 

that has been problematic 

and has failed severally. 

We have a contractor there 

but we needed to change the 

design because of the storm 

water drainage needs and the 

high water tables there so that 

the road does not fail. 

“FEC also approved an 

inter-ministerial committee 

to advise government 

on the best methods of disseminating 

information of the 

achievements of the current 

administration 

“At the end of the day, the 

council decided to set up an 

inter-ministerial committee 

to fashion out a marshal plan 

with the Ministry of Information 

to advise government on 

how policies and programmers 

could be better disseminated. 

In particular, to advise 

government on how the ministry 

and its agencies can deliver 

on its own mandate.” 

Education minister, Adamu 

Adamu, said FEC also approved 

the establishment of 

the first full Army University 

stitute legal action against 

SEC and the NSE if the technical 

suspension on Oando 

shares was lifted without 

the conclusion of the forensic 

audit, said the leadership 

of SEC had not handled 

the crisis as it should. 

Ebitimi, therefore appealed 

to the Presidency 

and the National Assembly 

to intervene in the interest 

of Nigerians and the economy. 

Also, Taiwo Oderinde, 

national coordinator of 

PROSAN, said, “Contrary 

to the impression out there, 

the forensic audit of Oando 

ordered since last year by 

SEC is not being done. They 

are only buying time while 

helpless Nigerian shareholders 

are suffering. 

“SEC’s report indicted 

Oando management. The 

management should be removed 

for the audit to take 

place. This is a manage- 

to be located at Biu in Borno 

State. 

The Ministry of Water Resources 

had in their memo 

highlighted the challenge of 

urban water supply, which is 

regressing. Other include the 

need to improve sanitation, 

which it said had “decreased 

over time.” 

The minster said, “We have 

not be able to meet the Millennium 

Development Goals 

and that works services in the 

rural areas are unsustainable, 

and spending on water sector 

has declined by .7% to 72% of 

the GDP in 2010. 

“We had three prayers for 

the council to approve the 

action plan: to declare a state 

of emergency on water and 

sanitation sector; to approve 

the establishment of Water, 

Sanitation and Hygiene Fund 

for the country. This fund will 

be one that federal, states and 

international donors can put 

in money so that we can begin 

to address the crisis water 

and sanitation sector in the 

country. 

ment that has been in place 

for over 19 years. After the 

audit, if they are innocent, 

they should be restored to 

take their position.” 

On his part, Mukhtar 

Mukhtar, national president, 

TSAN, who said the 

ordered forensic audit was 

not being carried out, questioned 

why the management 

of a company being 

audited be allowed to continue 

in office. 

He said the shareholders 

had also petitioned the 

House Committee on Capital 

Market and other Institutions, 

accusing the SEC 

of protecting Oando from 

probe. 

While commending the 

House Committee on its efforts 

to sanitise the capital 

market and to make it one 

of the best in the world, he 

said the time had come to 

take decisive action on the 

forensic audit of Oando.


FT FINANCIAL TIMES 

C002D5556 

BUSINESS DAY 

A1 

World Business Newspaper 

University crackdown 

raises fears for Turkish 

academic freedom 

Detention of antiwar students seen as indicative of growing intolerant of dissident 

LAURA PITEL 

The hilltop campus of prestigious 

Bogazici University 

in Istanbul was long viewed 

as a sanctuary. But in recent 

weeks, its tranquility has 

been shattered. 

Armoured vehicles have entered 

the campus, police have raided libraries 

and accommodation blocks and 

more than two dozen students have 

been detained. 

The clampdown was triggered by a 

fight over Turkey’s military operation in 

the Syrian Kurdish enclave of Afrin. A 

student society set up a stand offering 

sweets in honour of those killed in the 

operation. Other students objected and 

a scuffle broke out. 

The dispute prompted a furious 

response from President Recep Tayyip 

Erdogan, who slammed the antiwar 

protesters as “communist, traitor youth”. 

“We won’t give these terrorist youth 

the right to study at these universities,” 

he vowed. 

Turkish officials insist that the arrests 

are a legitimate security measure 

aimed at quashing support for the 

outlawed Kurdish militant group that 

was the target of Afrin campaign. 

But critics view the clampdown at 

the state institution as a fresh salvo in 

a wider assault on academic freedom 

in Turkey. 

“Students don’t want to come to 

university because there are still undercover 

police on campus,” said Cihangir 

Oz, a first-year student. “People don’t 

feel safe. Everyone is asking: how can 

we create a scholarly environment 

when police are in the library and in 

the dorms?” 

Bogazici staff are proud of the 

university’s reputation for liberalism 

and have staunchly guarded its independence. 

In the 1990s, they defied the 

secularist generals by allowing female 

students to wear the Muslim headscarf 

on campus. But now, many fear, the 

Deal aims to ease border delays but two of the biggest economies have refused to sign 

university will no longer be able to 

avoid the growing pressure. 

Umut Ozkirimli, a Bogazici graduate 

and political science professor at 

Lund University in Sweden, said: “This 

is just the latest step in a process that 

has been going on for some time now. 

Everyone knew that Bogazici and the 

private universities could not remain 

unscathed. And now it has started.” 

The early years under Mr Erdogan’s 

Justice and Development Party (AKP) 

were viewed by many as a golden 

era for scholarly freedom, with space 

opened up for debate on subjects long 

considered taboo. But critics say that as 

the Turkish president has adopted an 

increasingly majoritarian style of leadership, 

infused with a religious form 

of Turkish nationalism, he has grown 

more intolerant towards dissidents. 

Mr Erdogan was enraged by a petition 

in 2016, signed by more than 2,000 

academics, that criticised his government’s 

military operations against an 

outlawed Kurdish militia. The Turkish 

president described the signatories as 

terrorist supporters, prompting a wave 

of sackings and arrests. 

The crackdown accelerated in the 

wake of the violent coup attempted 

in 2016, which was followed by a vast 

purge of state institutions. 

A total of 5,800 academics were 

dismissed from their jobs, according 

to a tally by Turkey’s Human Rights 

Joint Platform. Some had ties to the 

Gulen movement, the Islamic fraternity 

accused of orchestrating the putsch, 

but others were leftists and liberals 

who maintain that they have no links 

to the group. 

Mr Erdogan also used the special 

powers granted under a state of 

emergency imposed in the wake of 

the failed coup to bestow himself with 

the power to directly select university 

rectors. One of his first appointments 

was at Bogazici, where he chose an 

engineering professor whose sister is 

an AKP member of parliament. 

Africa free trade pact raises hopes of prosperity 

JOHN AGLIONBY 

Venezuela stopped 

bond payments in 

September 

Page A3 

While Charles Oppong and 

three other drivers prepared 

to spend a ninth night sleeping 

under their trucks at a border 

post, officials from Ivory Coast and 

Ghana blamed each other for such 

hold-ups. 

Pointing the finger at his Ghanaian 

counterparts, an Ivorian official 

complained that Ghana insisted on 

closing the border at 6.30pm every 

day. But 500m away, a Ghanaian 

immigration officer retorted that his 

country’s laws were “perfect”, adding 

that “the difficulties are with our 

neighbours”. 

Mr Oppong and his frustrated 

colleagues said there was a disagreement 

over how much duty should be 

paid as they crossed from Ivory Coast. 

Yet their cargo was hardly contentious 

— all they were transporting 

was empty milk cartons. 

“Hopefully we’ll get it sorted tomorrow,” 

he said. “But we’re luckier 

than some people. Some cargo is 

delayed here for a month.” 

Such problems are common 

across Africa as poor logistics, bureaucratic 

bottlenecks, decaying 

infrastructure and corruption are 

blamed for stymieing trade across 

the continent’s borders. Ivory Coast 

and Ghana are both members of 

the Economic Community of West 

African States (Ecowas), which allows 

Continues on page A2 

UK businesses call for post-Brexit alignment with EU regulations 

CBI presents report on 23 sectors of the UK economy 

GEORGE PARKER 

Large swaths of the economy will 

be damaged if the UK deviates 

too far from EU regulations after 

Brexit, according to a new report from 

the CBI business lobby. 

Carolyn Fairbairn, head of the CBI, 

said the opportunities for business 

afforded by future regulatory freedom 

from Brussels were “limited” and that 

the majority of sectors want to stay close 

to current rules. 

She said that any gains from deregulation 

in some sectors are “vastly 

outweighed by the costs that will be 

incurred if the UK’s rules change so 

much that it reduces smooth access to 

the EU’s market”. 

The CBI said it had spoken to thousands 

of companies across 23 industries 

to provide Theresa May and her 

IMF chief warns trade war could rip apart global economy 

Lagarde says countries should ‘steer clear of protectionism’ 

CHRIS GILES 

Christine Lagarde warned on 

Wednesday that the rules that 

underpin global trade were 

“in danger of being torn apart” by 

protectionist forces in what the IMF 

managing director said would be “an 

inexcusable, collective policy failure”. 

Speaking at the University of Hong 

Kong, Ms Lagarde warned of the gathering 

threats of a trade war and the 

rapid rise in public and private debt 

around the world. But she stresses 

that the global economy continued 

to grow strongly and remained optimistic 

about the remainder of 2018 

and 2019. 

Tit-for-tat tariffs announced by 

the US and China have sparked fears 

of a damaging trade war between the 

world’s two largest economies. 

“The multilateral trade system 

has transformed our world over the 

past generation. But that system of 

rules and shared responsibility is now 

in danger of being torn apart. This 

would be an inexcusable, collective 

policy failure,” she warned. 

Her concerns came in the week 

before finance ministers from around 

the world gather in Washington 

to discuss what the IMF chief said 

China accelerates 

opening to foreign 

financial groups 

Page A4 

negotiators with a detailed breakdown 

of the kind of Brexit sought by business 

leaders. 

Asked whether Eurosceptic enthusiasm 

for breaking loose from Brussels 

might prevail, Ms Fairbairn said: “There 

are trade offs between control and access. 

Our ambition is simple: to make 

sure that kind of ideological debate can 

be properly informed.” 

The CBI survey, “Smooth Operations”, 

found that in 18 of the sectors 

surveyed, companies favoured convergence 

after Brexit: regulations that 

were either close to or identical to 

those in the rest of the EU. 

Ms Fairbairn said that Britain 

should seek a say over shaping those 

rules after Brexit, even if it would no 

longer have a formal say in the European 

Parliament, European Commission 

or the EU Council, where laws 

were “darker clouds looming” on the 

horizon. 

Ms Lagarde criticised the thinking 

of Donald Trump’s administration, 

while also directing her ire at Germany’s 

trade imbalances and the lack 

of proper protection of intellectual 

property and inefficient state subsidies 

in China. 

Tariffs “not only lead to more expensive 

products and more limited 

choices, but they also prevent trade 

from playing its essential role in boosting 

productivity and spreading new 

technologies” Ms Lagarde said, as she 

called on countries to “steer clear of 

protectionism in all its forms”. 

She hit at the Trump administration’s 

focus on the US bilateral trade 

deficit with Beijing, saying this was 

the result of complicated global supply 

chains in which China ran a significant 

trade deficit with other countries from 

which it imported component parts. 

She said the Trump administration 

should look closer to home to 

improve its overall trade deficit. “The 

US, for example, could help tackle 

excessive global imbalances by curbing 

gradually the dynamics of public 

spending and by increasing revenue 

— which would help reduce future 

fiscal deficits.” 

are made. 

“Alignment will need to come with 

mechanisms for influence and enforcement 

that benefit both sides,” she 

said, arguing that non-EU members 

such as Albania and Turkey had some 

say through EU agencies. 

Ms Fairbairn said there was “good 

engagement now” with ministers on 

the priorities for the EU trade negotiation; 

in the early months of Mrs May’s 

premiership relations between the CBI 

boss and prime minister were frosty. 

The report identified some sectors 

that were more enthusiastic about the 

possibility of regulatory divergence 

after Brexit, including shipping, waste 

and environmental services and water. 

It said that the agriculture, food and 

drink sector saw “limited opportunities” 

for divergence from EU rules, as 

did the hospitality trade. 

Germany, meanwhile, should 

use its excess savings, which drives 

its trade surplus “to boost its growth 

potential — including through investments 

in physical and digital 

infrastructure”. 

And in a passage aimed at China, 

she said an important trade policy 

reform package “includes better 

protecting intellectual property, and 

reducing the distortions of policies 

that favour state enterprises”. 

“Let us redouble our efforts to 

reduce trade barriers and resolve disagreements 

without using exceptional 

measures,” Ms Lagarde urged. 

The IMF managing director also 

sought to highlight fears for the continued 

growth of public and private debt, 

which IMF research to be published 

next week will say has reached an alltime 

high at $164tn. 

“Compared to its 2007 level, this 

debt is now 40 per cent higher, with 

China alone accounting for just over 

40 per cent of that increase,” Ms Lagarde 

said. 

Without action being taken to 

reduce the build up of debt, countries 

were more vulnerable to shocks, as 

are the banks and corporate sectors 

of countries where debts had grown 

quickly, especially China and India.

A2 BUSINESS DAY 

C002D5556 Thursday 12 April 2018 

FT 

Africa free trade pact raises 

hopes of prosperity... 

NATIONAL 

BlackRock’s gun-free funds show ethical investing is a good bet 

The investment manager is creating options for those who want to avoid firearms 

BROOKE MASTERS 

Americans fed up with gun violence 

now have the chance to speak with 

their purses. Last week, BlackRock, 

the world’s largest investment manager, 

said it was creating several options for 

investors who want to avoid AR-15 rifles 

and other civilian firearms. 

Gunmakers and most gun retailers 

will now be excluded from BlackRock’s 

broader socially responsible mutual and 

Continued from page A1 

for duty-free shipments for products 

made in the 15-country bloc. That Mr 

Oppong and his fellow drivers were 

held up demonstrates the challenges 

for politicians and businesspeople 

trying to deepen economic ties. 

The hope is that such issues will 

soon be consigned to history following 

the signing last month of a 

landmark continent-wide free trade 

agreement. The African Continental 

Free Trade Area, which was signed 

by 44 African leaders, aims to reduce 

90 per cent of tariffs to zero from the 

current average of 6.1 per cent. 

“We now have the construction 

for meaningful intercontinental 

trade,” Nana Akufo-Addo, Ghana’s 

president, said after the deal was 

signed. “An increase in trade is 

the surest way to develop fruitful 

relations between our countries, 

enhance development and attain 

prosperity.” 

There is big potential, analysts 

say. Africa boasts a market of 1.2bn 

people and a combined economic 

output of $2.5tn, according to the 

African Union. And the population is 

expected to double by 2050, the UN 

says. But intra-African trade accounts 

for only about $170bn, or 18 per cent, 

of the continent’s total annual formal 

commerce, according to the African 

Export-Import Bank. This compares 

with about 68 per cent for the EU. 

The UN’s economic commission 

on Africa estimated that if the new 

trade deal was fully implemented 

intra-African trade would swell at 

least 50 per cent within five years. 

But translating the leaders’ 

dreams into reality will be difficult. 

The continent’s two largest economies, 

Nigeria and South Africa, are 

among 11 governments that have 

refused to sign the agreement. Their 

leaders’ claims that they need to 

protect nascent domestic industries 

illustrate how national interests can 

hamper greater continental integration. 

Parfait Kouassi, an Ivorian businessman 

and deputy chairman of 

the country’s chamber of commerce, 

said he was “very sceptical” about 

the trade deal’s short-term prospects 

because of “so many officials’ narrow-minded 

thinking”. He recently 

wanted to build a medicine factory 

in Benin but “it just couldn’t happen 

because of the bureaucracy”. 

“If I want to export pharmaceuticals 

from here to [neighbouring] 

Burkina Faso I have to export them 

first to France,” Mr Kouassi said. 

Arancha González, executive 

director of the International Trade 

Centre, an agency mandated by the 

UN and World Trade Organization, 

acknowledged that implementation 

would be challenging, partly because 

Africa is “55 markets that are the 

product of history rather than the 

product of enlightened thinking”. 

exchange traded funds. Such funds have 

historically excluded companies that 

make cluster bombs, nuclear reactors 

and cigarettes, while favouring companies 

that are rated socially responsible. 

BlackRock’s institutional investors will 

be offered an even more targeted option: 

they can screen gun stocks out of 

their endowments and include gun-free 

index funds in their employees’ pension 

plan choices without going the whole 

hog on ethical investing. 

Zuckerberg 

This level of pointed shunning is 

unprecedented for BlackRock. The 

investment manager began looking at 

the issue after the February massacre 

of 17 people at Marjory Stoneman 

Douglas High School in Florida sparked 

widespread protests against the US’s lax 

gun laws. The move also comes shortly 

after BlackRock’s chief executive, Larry 

Fink, warned companies that financial 

performance was not enough — they 

must also “make a positive contribution 

to society”. 

That is a noble idea, but investors 

have long been wary about the potential 

impact on their portfolios of trying to do 

good, while also doing well financially. 

“Sin stocks” — companies that 

sell alcohol, tobacco, weapons and 

gambling — have historically done 

better than the broader market. And 

Norway’s recent experience tends to 

back this up. Its sovereign wealth fund 

began excluding such stocks from its 

Zuckerberg faces off with lawmakers over regulation 

Social network has ‘broader responsibility’ than just following the law, founder says 

BARNEY JOPSON 

Mark Zuckerberg said he was 

open to the “right regulation” 

of Facebook but did not 

commit to any specifics in a disasterfree 

grilling on Capitol Hill that added 

more than $17bn to the company’s 

market value. 

Investors responded positively to 

the Facebook founder’s five-hour testimony 

in front of a Senate committee, 

where lawmakers criticised the social 

network for how it exploits its users’ 

data and for the leak of information 

on 87m users to the research firm 

Cambridge Analytica. 

Facebook shares have been battered 

by concern that a string of 

controversies could tempt lawmakers 

to introduce profit-crimping regulation, 

but they rose throughout Mr 

Zuckerberg’s testimony and ended 

up 4.5 per cent. 

Mr Zuckerberg told senators he 

agreed that “we have a broader 

responsibility than what the law requires” 

to police the platform. 

He said he was not opposed to 

Congress introducing new laws to 

govern the company, but fended off 

attempts to pin him down on details 

and dodged a request to publicly advocate 

for one proposed bill. 

“Our position is not that regulation 

is bad,” Mr Zuckerberg said. “Our question 

is what is the right framework, not 

whether there should be one.” 

Facing persistent questions over 

the ethics of Facebook monetising 

users’ personal information, Mr 

Zuckerberg also left the door open to 

creating a paid form of Facebook with 

no ads, saying: “There will always be a 

version of Facebook that is free.” 

Chuck Grassley, the Republican 

chairman of the judiciary committee, 

said many Facebook users still did 

not understand the extent to which 

their personal information was “collected, 

protected, transferred, used 

and misused”. 

“At a minimum, consumers must 

have the transparency necessary to 

make an informed decision about 

whether to share their data and how 

it will be used,” Mr Grassley said. “The 

status quo no longer works.” 

John Kennedy, a Republican senator, 

put it more bluntly. “Your user 

agreement sucks,” he said. 

Mr Kennedy, who advised Facebook 

to rewrite its user agreement in 

plain language, told Mr Zuckerberg: 

“There’s going to be whole lot of bills 

introduced to regulate Facebook. 

It’s up to you to decide whether they 

pass.” 

Quizzed by Ed Markey, a Democrat, 

over a bill that would require any 

company that gathers personal data to 

secure explicit consumer permission 

to reuse it, Mr Zuckerberg said: “In 

principle that makes sense — and the 

details matter.” 

The Facebook founder also had 

reasonably warm words for Europe’s 

new rules on data privacy, known as 

the General Data Protection Regulation. 

“I think that [Europeans] get 

things right,” he said, while noting 

that “we have somewhat different 

sensibilities in the US”. 

Several Republicans put forward 

reasons to be cautious about new 

regulation, warning that it could turn 

into a barrier to entry that prevents 

start-ups from challenging incumbents 

with more resources to comply. 

Mr Zuckerberg concurred. “I 

agree with the point that when you’re 

thinking through regulation, across 

all industries, you need to be careful 

it doesn’t cement in the current 

companies that are winning.” 

Facebook has unveiled a barrage 

of initiatives designed to show Mr 

Zuckerberg is already addressing 

public and political concerns, and 

more carefully considering the implications 

of new features. In its latest 

reform, announced just hours before 

the hearing, Facebook said it was introducing 

a “data abuse bounty” programme 

to reward people who report 

any misuse of data by app developers. 

Asked by John Cornyn, a Republican, 

about Facebook’s erstwhile 

“move fast and break things” motto, 

Mr Zuckerberg elicited laughter 

from the room by saying: “Our current 

motto is move fast with stable 

infrastructure.” 

Beyond privacy, senators also 

raised issues of free speech and Russian 

meddling in US elections. “One 

of my greatest regrets in running the 

company is that we were slow in identifying 

the Russian information operations 

in 2016,” Mr Zuckerberg said. 

His testimony offered a muddled 

answer to questions about Facebook’s 

contact with special counsel Robert 

Mueller, who is investigating whether 

Donald Trump’s presidential campaign 

colluded with Russians. 

The company was “working with” 

Mr Mueller, Mr Zuckerberg said. “I 

actually am not aware of a subpoena. 

I believe that there may be”. 

Mark Zuckerberg opens hearing 

with an apology 

Facebook has done a U-turn in 

recent days by saying it now backs 

the Honest Ads Act, a narrow piece 

of legislation that would require tech 

groups to reveal more about the origins 

of political ads. Mr Zuckerberg, 

however, declined to pledge to lobby 

for it. 

As Lindsey Graham, a Republican, 

suggested consumers had no alternative 

to Facebook, Mr Zuckerberg said: 

“The average American uses eight different 

apps to communicate with their 

friends and stay in touch with people. 

Ranging from texting apps to email.” 

Asked whether Facebook had a 

monopoly, Mr Zuckerberg said: “It 

certainly doesn’t feel like that to me.” 

broad based equity investments in 

2004. That decision has cost it about 0.1 

percentage points a year. On the other 

hand, the fund calculated that excluding 

individual companies over specific 

environmental, human rights and other 

ethical issues had boosted its returns by 

0.04 percentage points annually. Over 

a 12-year period, the fund estimated 

that ethical investing cut returns by 

1.6 per cent compared with its equity 

benchmark. 

Hard questions for 

India’s private 

sector banks 

Doubts over performance of non-state lenders 

ICICI and Axis after surge in bad loans 

SIMON MUNDY 

A 

landmark moment for India’s 

male-dominated business 

sector came in the summer 

of 2009, when Chanda Kochhar 

and Shikha Sharma took charge of 

its two largest private-sector banks 

by assets. 

Both women had risen rapidly 

through the ranks at fast-growing 

ICICI Bank, and were the final two 

candidates in its search for a new 

leader. When Ms Kochhar won out, 

Ms Sharma swiftly departed for the 

top job at Axis Bank, another of the 

private lenders that were eating 

into the dominance of state-owned 

banks. 

But just as the two women’s 

career paths closely tracked each 

other on their way to becoming 

India’s first female private-sector 

bank heads, their lengthy tenures 

now threaten to come to an abrupt, 

near-synchronous end. 

The public drama surrounding 

them reflects growing scrutiny of 

lending standards at India’s large 

banks, and of the ability of major 

companies’ boards to hold their top 

executives to account. And as calls 

grow for the privatisation of India’s 

ailing state-run banking sector, it 

has highlighted the fact that some 

of the biggest existing private-sector 

banks face serious questions over 

their performance. 

On Monday evening, Axis’ board 

announced a sudden about-turn in 

its leadership plans. It had earlier 

granted Ms Sharma a three-year 

contract extension that would 

have kept her in charge until June 

2021 — but she will now depart 

at the end of this year. The move 

followed local media reports that 

the central bank was resisting the 

extension, after Axis was hit by a 

surge in non-performing corporate 

loans. 

While India’s state-controlled 

banks have been the worst hit 

by rising business loan defaults, 

ICICI and Axis have been much 

more badly affected than other 

private lenders. Both have had a 

strong focus on corporate banking 

since their inception, and 

took part in an enthusiastic wave 

of industrial lending over much of 

the past decade. 

At 7.82 per cent and 5.28 per 

cent respectively at the end of December, 

ICICI’s and Axis’ respective 

bad loan ratios were by far 

the highest among private-sector 

lenders. But while Ms Sharma’s 

position was weakened by criticism 

of Axis’s financial performance, 

Ms Kochhar has been hit by 

allegations of a more serious nature.


FINANCIAL TIMES 

COMPANIES & MARKETS 

@ FINANCIAL TIMES LIMITED 

Venezuela stopped bond 

payments in September 

Central bank data suggest government is in ‘a stealth default’, says analyst 

JONATHAN WHEATLEY 

Venezuela stopped paying 

bondholders in September, 

according to central bank 

data, contradicting statements 

by President Nicolás Maduro 

that the country would continue 

to honour its debts while negotiating 

a resettlement with its 

creditors. 

The data show that regular 

foreign debt payments of hundreds 

of millions of dollars a 

month, in line with the country’s 

sovereign obligations, fell to a 

few tens of millions from last 

October for fees and the legacy of 

a 1980s-era restructuring. 

“This proves that Venezuela is 

deliberately hoodwinking bondholders 

and engaging in a stealth 

default,” said Russ Dallen of boutique 

bank Caracas Capital, who 

follows Venezuelan debt closely. 

The data were posted in an 

Excel file as part of a recent 

revamp of the central bank’s 

website and include monthly 

expenditures in US dollars on 

public foreign debt payments 

going back to 1996. Previously, 

data on foreign debt payments 

were published in the form of a 

ratio that revealed little information, 

Mr Dallen said. “This must 

have been posted by an intern,” 

he added. 

RALPH ATKINS 

HNA, the Chinese conglomerate 

which is seeking to 

strengthen its finances, has 

abandoned plans to float Swissport, 

the air services group, just weeks 

after it was forced to pull plans to 

list the Gategroup catering group 

that it also owns. 

Swissport said in a brief statement 

that the planned initial public 

offering and listing on the Swiss 

stock exchange would be deferred 

“due to current market conditions,” 

without providing further details. 

Swissport, which provides ground 

services and cargo handling, had 

revenues of €2.8bn last year. 

The decision appeared a further 

setback for HNA following the collapse 

last month of plans to raise up 

to SFr1.3bn ($1.37bn) by floating up 

to 65 per cent of Gategroup, which 

it had acquired less than two years 

previously. 

Other Swiss companies have 

pushed ahead recently with IPOs. 

However the decision to pull the 

Gategroup IPO highlighted wariness 

among investors about taking 

stakes in companies alongside HNA, 

although bankers close to the deal 

said it also flopped because of the 

Mr Maduro announced on November 

2 that the country would 

restructure and refinance its debts 

after making one last payment on 

a bond owed by PDVSA, the stateowned 

oil company. S&P Global, 

the rating agency, declared the 

country in default shortly afterwards. 

Yet holders of bonds issued by 

PDVSA and Elecar, a state-owned 

electric utility, have continued to 

receive sporadic payments, which 

have amounted to about $2.5bn 

since Mr Maduro’s announcement. 

Several payments have been made 

late, sometimes after the 30-day 

grace payment for coupon payments. 

No payments at all have been 

received on bonds issued by the 

government of Venezuela, despite 

assurances that the process of 

payment was under way. 

The central bank data, which 

cover payments of sovereign debt 

only and exclude obligations by 

PDVSA and other state entities, 

show that just $83m was paid in 

October, compared with sovereign 

obligations amounting to $465m, 

according to data from Caracas 

Capital. 

Payments in November fell 

to $28m, compared with obligations 

of $183m, and in December 

declined to $23m, compared with 

obligations of $242m. 

China’s HNA drops plans to float 

Swiss air services group 

price demanded. 

HNA ran into controversy in Switzerland 

last year when the country’s 

takeover watchdog ruled that the 

Chinese group had provided “untrue 

or incomplete” information regarding 

its ownership when it acquired 

Gategroup for SFr1.4bn in 2016. 

The Chinese conglomerate has an 

estimated $20bn in debt maturing 

this year or next. The company has 

sold some assets and extended credit 

arrangements with banks which — 

until the Gategroup setback — had 

helped it navigate a turbulent first 

three months of the year. 

Immediately after the Gategroup 

setback, Swissport had said its listings 

plans — announced in January 

— remained on track. But Tuesday’s 

decision to pull the float did 

not surprise observers. Swissport’s 

IPO would almost certainly have 

proved even more challenging than 

Gategroup’s because Swissport’s 

finances are more intertwined with 

its Chinese parent, due to a series of 

short-term loans the Swiss group has 

made to HNA affiliates. 

HNA and Swissport had given no 

indication of how much would have 

been raised from the planned IPO, 

but said HNA would have retained 

a “long term strategic shareholding”. 

ANJLI RAVAL 

Oil extended gains from the 

previous session, rising 

above $70 a barrel, as the US 

neared a decision about whether to 

launch a strike on Syria in response 

to an suspected chemical attack. 

Brent crude, the international oil 

benchmark, rose $1.49 a barrel in 

Tuesday afternoon trading to $70.14, 

culminating in a more than 4 per 

cent jump in prices over the past two 

days. West Texas Intermediate, the 

US marker, also rose $1.25 a barrel 

to $64.68. 

Tension has mounted after an 

attack on Douma in eastern Ghouta 

which the Syrian American Medical 

Society, a medical relief organisation, 

said killed dozens of people and 

injured hundreds more, and which 

C002D5556 

coincided with worries that US sanctions 

against Russia and potentially 

Iran will hit oil supplies. 

Following new restrictions on 

Russian business people, including 

aluminium producer Rusal and its 

founder Oleg Deripaska, some traders 

have raised questions about any 

impact on the oil sector. Vladimir 

Bogdanov, co-owner of Surgutneftegas, 

which produces more than 

10 per cent of Russia’s oil, has also 

been named leading to concerns 

the pool of sanctions-hit individuals 

and companies could widen to cover 

larger oil companies. 

“The aluminium market was 

reacting very firmly on the latest 

US sanctions against Russian aluminium 

interests and that is helping 

to develop the ‘what-if’ scenarios on 

the basis of US sanctions on Russian 

BUSINESS DAY 

Venezuela’s President Nicolas Maduro launches a new oil-backed cryptocurrency called “Petro” in 

Oil extends gains to breach $70 a barrel 

A3 

oil interests,” said Olivier Jakob at 

Petromatrix. 

At the same time, the US is weighing 

the prospect of withdrawing from 

Iran’s nuclear deal with western 

powers, which some market participants 

have said could hit crude 

supplies from the Opec producer. 

“We regard such fears as exaggerated, 

in the case of both Iran 

and Russia,” said Carsten Fritsch at 

Commerzbank. Still, he said, “psychological 

factors” are driving prices. 

Geopolitical anxieties have offset 

concerns about a trade war between 

the US and China that could hit 

global economic growth and, in turn, 

oil demand. Robust consumption 

has helped prices to recover above 

$70 a barrel alongside production 

cuts from big producer nations led 

by Opec and Russia. 

Start-up offers automatic switching to cut home energy bills 

Switchcraft to move customers to cheaper fuel deals 

CLAER BARRETT AND 

JAMES PICKFORD 

A 

start-up energy switching 

service is promising to 

save households time and 

money by automatically switching 

them to a cheaper deal in the 

market “forever”. 

Switchcraft, the idea of ex-City 

trader Andrew Long, claims the 

free service can save users an average 

of £313 “year after year” by 

automatically switching energy 

provider as customers roll off the 

best deals, meaning they avoid 

being price-gouged by expensive 

“standard” tariffs. 

“The best deals are for new 

customers, so the 83 per cent of the 

population that don’t find the time 

to switch are overcharged,” said 

Mr Long. “Switchcraft provides a 

hassle-free solution to staying on 

the best energy deal permanently.” 

According to Ofgem, the energy 

regulator, 5.1m electricity consumers 

and 4.1m gas consumers 

switched supplier in 2017, producing 

between them the highest total 

for almost a decade. 

Switchcraft competes with 

price comparison websites but, 

unlike such services, its users 

register their details once and then 

are automatically moved to the 

best price plan without having to 

do anything else. 

“We don’t have TV adverts, and 

we don’t want to use gimmicks,” 

said Mr Long referring to the succession 

of opera singers, meerkats 

and twerking builders used by his 

competitors. “They need to be 

memorable. In a way, we want 

people to forget about us. You 

only have to sign up once — and 

we want to keep on doing a decent 

job for people.” 

Consumer groups have censured 

utilities companies for 

penalising customers for their 

loyalty, reserving their best rates 

for those who sign up. Citizens 

Advice calculated that consumers 

who were loyal to their existing 

providers of services such as 

energy, mobile, broadband and 

home insurance, were missing out 

on up to £1,000 a year by failing 

to switch. 

Automatic switching is already 

offered by services such as Flipper 

and Switchd. Both charge a 

fee: Flipper of £25 a year; Switchd 

charges £1.99 a month. 

Other services also calculate 

the annual savings of moving and 

notify users online. “The problem 

is, if you’re sending people a reminder, 

you’re not actually taking 

it off their to-do list,” said Mr Long. 

“You’re a busy professional. You 

sign up to our website. We do it all 

for you — and that problem is now 

gone, forever.” 

Like price comparison websites, 

Switchcraft takes a commission 

from energy companies for 

bringing in new customers. For 

this reason, it only covers around 

two-thirds of energy suppliers 

(including all of the big six) as not 

all pay commissions. 

Andrew Hagger of consumer 

website MoneyComms said the 

restriction might give potential 

users of the service some pause. 

“My concern would be that you’re 

only having a limited choice and 

possibly missing out on some of 

the better deals.” 

Mr Long and Switchcraft cofounder 

and chief technology 

officer Rob Porter hope to expand 

Switchcraft into insurance, broadband, 

mobile phones or any market 

“where people buy household 

services on a repeat basis”. About 

1,000 customers have signed up 

for its automatic energy switching 

service so far. 

When customers’ fixed-term 

contracts draw to a close, the 

technology behind the website 

searches for a cheaper deal. Customers 

are informed by email of 

the new supplier and estimated 

savings versus staying with the 

same provider, before their supply 

is switched.


FT 

ANALYSIS 

C002D5556 

BUSINESS DAY 

Healthcare: Cancer breakthrough 

leads China’s biotech boom 

New generation of cell therapies helps Chinese emerge as industry 

A4 

Beijing has long used ownership caps and joint-venture requirements to protect domestic companies from competition © AP 

China accelerates opening to foreign financial groups 

Majority stakes to be permitted in securities and fund management companies within months 

TOM MITCHELL AND 

HUDSON LOCKETT 

Foreign financial groups will be 

allowed to take majority stakes 

in securities, fund management, 

futures and life insurance companies 

“within a few months”, China’s 

central bank said on Wednesday. 

The announcement came a day 

after President Xi Jinping promised 

to “accelerate” the opening of China’s 

financial markets and to ease foreign 

investment restrictions in the automotive, 

shipbuilding and aviation 

sectors. 

China’s finance ministry first said 

in November that it would allow 

overseas companies to take majority 

stakes in securities, fund management 

and futures companies, but did 

not specify a timeline for implementation. 

At the time Zhu Guangyao, 

vice-finance minister, also said the 

foreign investment ceiling in life 

insurance joint ventures would be 

raised to 51 per cent, from the current 

49 per cent, by the end of 2020. 

Beijing has long used ownership 

caps and joint-venture requirements 

to protect domestic companies from 

competition, prompting years of 

complaints that these restrictions 

hinder foreign groups in China. 

Russia steps up warnings against US action in Syria 

Moscow’s UN representative warns of ‘grave and tragic events’ if action is taken 

KATHRIN HILLE 

Russia has stepped up its warnings 

against US military action over last 

week’s alleged chemical weapons 

attack in Syria, warning that it would risk 

triggering “grave and tragic events”. 

Vasily Nebenzia, Russia’s permanent 

representative to the UN, said late on 

Tuesday night. “I would once again 

implore you — refrain from those plans 

that you have in mind for Syria.” 

Moscow’s renewed warning came 

as the US, France and the UK were considering 

a response to indications that 

Douma, a rebel holdout near Damascus, 

the Syrian capital, had been attacked 

with chemical weapons, killing at least 

40 people. 

French president Emmanuel Macron, 

who has spoken twice to US president 

Donald Trump since the attack, 

on Wednesday suggested a military response 

had been decided and that allies 

were weighing the details of the operations. 

France “is continuing to exchange 

technical and strategic intelligence with 

our allies to define our reaction, which 

will take place in the coming days,” he 

tweeted. 

While US President Donald 

Trump rejected the finance ministry’s 

November offer as insufficient, Chinese 

negotiators led by Vice-Premier 

Liu He hope that a faster opening of 

the country’s financial sector will help 

avert a trade war between the world’s 

two largest economies. 

The People’s Bank of China also 

said on Wednesday it would open 

the country’s trust, leasing and car 

and consumer finance industries 

to foreign investment by the end of 

this year. It added that it would not 

impose foreign ownership limits on 

commercial banks’ asset investment 

and wealth management operations. 

However, US government officials 

and analysts have pointed out that 

China is allowing foreign majority 

control in areas already dominated by 

large domestic companies that enjoy 

huge economies of scale. 

Jonas Short at Everbright Sun 

Hung Kai said it was significant that 

the PBoC also indicated overseas 

brokerages could partner with any 

Chinese company, rather than a 

Chinese brokerage, potentially giving 

them even greater control over 

operations. 

But Mr Short noted it could take 

time for foreign financial firms to 

secure official approvals to increase 

Mr Trump on Tuesday cancelled a 

visit to Latin America as he attempted to 

rally allies to back the US response to the 

alleged chemical attack. 

The White House said the president 

would “remain in the United States to 

oversee the American response to Syria 

and to monitor developments around 

the world”. 

Mr Trump spoke to Theresa May, UK 

prime minister, on Tuesday. On Monday, 

the US president said that he would 

deliver his decision on whether to strike 

Syria in 24 to 48 hours. 

France’s government spokesman 

said on Tuesday that Paris would respond 

if it were proved that forces loyal 

to Syrian president Bashar al-Assad had 

carried out the attack. “The president 

[Macron] has repeated again and again 

that if the red line is crossed, and if it is 

established who is responsible, it will 

lead to a response,” Benjamin Griveaux 

told Europe 1 radio. 

While humanitarian aid groups and 

western governments have pointed 

the finger at the Syrian regime, Russia, 

which backs President Assad’s regime, 

denies that a chemical weapons attack 

took place at all. 

their stakes or form new companies. 

A year after it said it would open 

China’s domestic payments market, 

the central bank has yet to award 

a foreign company a license in the 

sector. 

Last week the US unveiled plans 

to assess punitive tariffs on $50bn of 

Chinese industrial exports as soon 

as June, in retaliation for allegedly 

forcing foreign investors to surrender 

technology and other intellectual 

property to local joint venture partners. 

Chinese officials, who deny 

appropriating foreign investors’ intellectual 

property, responded with 

plans to tax an equal amount of US 

exports. 

Mr Trump has signalled that he is 

more interested in a loosening of the 

50 per cent foreign ownership limit in 

China’s auto sector and lower tariffs 

on imported cars. In a speech at the 

Bo’ao Forum for Asia on Tuesday, Mr 

Xi said China would move on both 

these fronts but did not provide any 

details. 

Mr Trump nevertheless reacted 

positively, saying on Twitter that he 

was “very thankful for President Xi[’s] 

kind words on tariffs and automobile 

barriers [and] his enlightenment on 

intellectual property and technology 

transfers”. 

Mr Nebenzia was speaking after the 

US and its allies on one side and Russia 

on the other blocked each other’s 

competing resolutions on a new joint 

chemical weapons inspection mission 

for Syria at the UN Security Council on 

Tuesday night. 

Russia has been scuppering attempts 

at a renewal of the joint inspection mission 

for chemical weapons in Syria since 

it expired last autumn. Most recently, 

Russia sponsored a proposal that insisted 

such a mission must have an invitation 

from the Syrian government, visit all sites 

in question and prove responsibility of an 

alleged perpetrator beyond any reasonable 

doubt — conditions that western 

diplomats argue would hamper the 

independence of such a mission. 

Mr Nebenzia suggested that the US 

and its allies did not want a real investigation, 

and might use the UNSC’s failure 

to adopt their proposal to justify military 

action. 

“You say that we are very good at playing 

games. I’m not sure about that. But 

what we know for sure is that you’re good 

at making threats,” he said. “The threats 

that you are uttering now with regard 

to Syria must extremely worry all of us.” 

DAVID CROW, TOM HANCOCK 

AND WANG XUEQIAO 

A 

few days before Craig Chase 

was discharged from the 

Jiangsu Provincial People’s 

Hospital in Nanjing, his doctor told 

him something he never expected 

to hear: his cancer had been cured. 

“His English was not so good, so 

he used Google Translate. When he 

said I was cured, I told him it was 

impossible — there is no cure for 

multiple myeloma,” he recalls. “But 

he said, ‘no, you’re definitely cured’. 

It was unbelievable.” 

Unbelievable, perhaps, but also 

true. When Mr Chase, now 57, returned 

home to America after his 

six weeks of treatment in China to 

undergo further tests, his doctors 

could find no trace of multiple 

myeloma. The blood cancer he had 

suffered for three years — which 

had threatened to end his life — 

was gone. 

Wealthy Chinese people often 

travel to the US for healthcare, but 

it is rare to hear of someone going 

the other way. Indeed, Mr Chase 

was the first American to be treated 

at the Jiangsu hospital, where he underwent 

an experimental procedure 

known as chimeric antigen receptor 

cell therapy or Car-T. 

As biotech has gone from 

strength to strength over the past 

four decades, China has been a 

backwater for the industry, tending 

to follow the west rather than pursuing 

its own innovations. But it is now 

rapidly emerging as a world leader 

in cell therapies like Car-T, which 

try to treat and even cure illness by 

hacking the body’s biology. 

There are already more clinical 

trials in the country than in the US, 

and executives and scientists say 

it has several strategic advantages 

that could allow China to challenge 

US dominance, including an accommodating 

regulatory regime, 

low labour costs and expertise in 

precision manufacturing. 

“The Chinese companies I have 

met are determined to become 

leaders in this,” says Brad Loncar, 

founder of the Loncar Cancer Immunotherapy 

Exchange Traded 

Fund, who recently returned from 

a trip to the country. “These treatments 

have the potential to be highly 

disruptive to medicine and I think 

they view it as a unique opportunity 

as new contenders to spring to the 

forefront of the biotech industry.” 

At a time when President Donald 

Trump is fretting about Beijing’s 

plans to dominate the industries of 

the future, China’s push to become 

the pre-eminent destination for cell 

therapies and other evolving technologies 

such as gene editing would 

represent a major shift in modern 

medicine and an important marker 

in the growing technological competition 

between the US and China. 

Car-T “is among the few corners 

of biotech in which China may have 

a chance to compete globally in the 

near to medium term . . . and even 

leapfrog global pace in certain targets”, 

analysts at Bernstein wrote in 

a report this year. 

Mr Chase’s visit to China was 

not without its jarring moments. On 

one occasion in Nanjing, his doctor 

used a herbal wrap to reduce a large 

swelling in his ankle. “It smelled like 

an Italian lunch,” recalls Mr Chase, 

a paper broker, though he says it 

seemed to work rather well. 

This low-tech anecdote belies 

the fact that Car-T is at the cutting 

edge of biology: it involves 

extracting a patient’s blood cells, 

re-engineering them in a lab so 

they can identify and destroy cancer 

and then re-inserting them into 

the body. 

There are already two Car-T 

products for rare types of leukaemia 

on the market in the US, made by 

Novartis, the Swiss pharma company, 

and Gilead, the west coast 

biotech group. But the treatment is 

still in its infancy and many scientists 

in the field believe the biggest 

advances are yet to come. The next 

bigtarget is multiple myeloma, after 

which companies are expected to 

turn their attention to solid cancers 

and even infectious diseases 

like HIV. 

Research into Car-T in China 

has exploded in recent years. There 

are currently 116 clinical trials 

registered in the country, according 

to a US government database, 

compared with 96 in the US and 

15 in Europe, giving it a lead that 

would have been unthinkable when 

the treatment was first discovered. 

“It was zero when we started 

[human trials] in 2010,” says Carl 

June, a professor at the University 

of Pennsylvania, who helped develop 

the earliest Car-Ts. “Then they 

caught up with us, and now they 

have surpassed us.” 

Although the Trump administration’s 

recently proposed trade tariffs 

have targeted raw pharmaceutical 

ingredients from China, they would 

have a negligible effect on the country’s 

ability to pursue and export the 

cell and gene therapies of the future. 

Mr Chase first heard about the 

particular Car-T that would rid him 

of cancer after a large clinical trial 

of the treatment was published last 

June at the world’s most prestigious 

oncology meeting. The gathering 

of the American Society of Clinical 

Oncology takes place each year in 

a conference centre by Lake Michigan, 

where 30,000 researchers and 

doctors from around the world pore 

over studies sponsored by the biggest 

pharma companies in cancer. 

But the most eye-catching research 

at last year’s conference was 

presented by a Chinese biotech 

group that virtually no one had 

heard of: Nanjing Legend. 

In a study of 35 Chinese multiple 

myeloma patients, who had all relapsed 

and were no longer responding 

to drugs, 33 participants had entered 

remission within two months 

of being treated. The response rate 

of 94 per cent was among the highest 

seen for a Car-T trial. 

Excitement over the trial soon 

turned to disbelief in some quarters, 

in part because Legend was such an 

unfamiliar name, but also because it 

was based in China. Some delegates 

at the conference told the Financial 

Times that data from a company 

based in a country that fiddles its 

economic growth figures could not 

be trusted. 

But Mr Chase, who had spent 

five months on the waiting list for 

a Car-T trial in the US, investigated 

Legend, spoke to its executives and 

decided it was a credible company.

BUSINESS DAY 

Why it Matters 

NEWS YOU CAN TRUST I THURSDAY 12 APRIL 2018 C002D5556 

GES debt threatens private sector support 

for government initiatives 

Nigeria for many 

years has 

adorned a tag 

as one of the 

counties in the 

world where farm yields rank 

among the lowest. In what 

seemed like a bid to address 

this, the Federal Government 

introduced the Growth 

Enhancement Support (GES) 

programme in 2012, as part of 

measures to depoliticize the 

input sector by withdrawing 

the state from procurement 

of inputs and developing a 

private sector channel for 

input distribution. 

Grow Africa, an organisation 

which works to increase 

private sector investment in 

agriculture, and accelerate 

the execution and impact of 

investment commitments, 

noted the aim of GES was to 

target individual smallholder 

farmers through a smart subsidy, 

using a high-tech delivery 

mechanism. Within two 

years, the GES was described 

as “being highly successful on 

several fronts. Its most striking 

achievement has been 

to build a commercial agrodealer 

network that delivered 

subsidized inputs to 1 million 

farmers in the first year and 5 

million in the second year.” 

These achievements have 

now become somewhat watered 

down as the government 

fails to offset the debt 

owed input suppliers since 

2014. In the last four years, 

payment has been made 

in piecemeal, denying an 

estimated network of 300 Nigerian 

companies, capital to 

put back into their businesses. 

Kabiru Fara, national 

chairman of the Agro Dealers’ 

Association, noted that 

from about N67 billion which 

was owed, approximately N18 

billion is still being owed. The 

trend with non-repayment no 

doubt threatens future private 

sector support for government 

initiatives as fears of 

illiquidity to keep businesses 

running make such ventures 

unattractive. 

The impact of the debt 

has been felt, not only by the 

companies being owed, but 

even farmers themselves, and 

invariably, the entire country 

bears in the reduced productivity 

that emanates. 

In the Seed Security Assessment 

in North Eastern 

States of Nigeria by the Food 

and Agriculture Organization 

(FAO) of the United Nations 

in 2016, it was stated that; 

the withdrawal of some private 

partners from the GES 

Scheme (a government farm 

input subsidy programme) 

led to reduction in quantity 

of certified seeds and fertilizers 

available at community 

level. Moreover, private seed 

companies reportedly shifted 

their interest to government 

and INGOs’ orders and not 

individual farmers. This was 

prompted by the comparatively 

low demand or adoption 

of adapted certified seeds 

by the individual farmers and 

the companies’ interest in prioritizing 

the few large orders 

from DSD providers. Some 

local grain markets were also 

disrupted, especially in the 

areas extensively affected by 

the insurgency. These markets 

had usually offered an 

alternative source of seed for 

poor farmers who needed to 

supplement their own saved 

seeds but couldn’t afford 

better yielding certified seeds. 

Seed Aid interventions were 

limited across the three states 

and largely targeted the internally 

displaced persons with 

for the following year for use 

as seeds. But unknown to 

many farmers, with every generation, 

quality goes down. As 

experts have noted, by investing 

a little sum of money on 

a bag of seeds, the quality of 

farm produce will always be 

uniform and high level. But 

for many small holder farmers, 

the investment, however 

small the amount of money 

is considered too high. 

While agriculture should 

be taken as a business, and 

no longer just a way of life, 

the transition to this mindset 

is a process which may now 

suffer some setback. If debts 

had been paid, input suppliers 

would have remained 

very active, and the process 

of getting farmers run proper 

agricultural businesses would 

have continued. 

the withdrawal of some private 

partners from the GES Scheme 

led to reduction in quantity of 

certified seeds and fertilizers 

available at community level 

access to farming land; not 

the poor farming households. 

This instance captured 

in the FAO report, is one of 

several ways that small holder 

farmers have been at the 

receiving end of the lack of 

input supplies. The already 

bad situation in productivity 

will only get worse, as access 

to seeds and fertilisers could 

be more limited. 

The practise by many 

farmers has been keeping of 

seeds from part of their last 

harvest, which is then saved 

The Growth Enhancement 

Support Scheme had positive 

gains, many of which have 

been eroded with the lack of 

sustenance for the scheme, 

much less offsetting the outstanding 

debt. For instance, a 

group of researchers in a published 

2018 paper on Impact 

of the Growth Enhancement 

Support Scheme (GESS)’ 

On Farmers’: Income in Oyo 

State, Nigeria, submitted that 

the scheme had a positive Impact 

on the On-Farm Income 

of Cassava and Maize Farmers 

in the Study Area. This according 

to the authors; Kemisola 

Adenegan, Foluke Fagbemi, 

Oladele Osanyinlusi, and 

Abiodun Omotayo, suggests 

that productivity-enhancing 

agricultural innovations can 

contribute to raising the income 

of farming households, 

improve poverty alleviation 

and food security in Nigeria 

and other developing countries 

of the world. It was therefore 

recommended that farmers 

should be encouraged or 

advised to form associations 

or put themselves in groups in 

order to increase their likelihood 

of participation in this 

Scheme or subsequent programmes 

and credit should 

also be made available in 

form of soft loan to enhance 

their access to this subsidized 

farm inputs. 

While Grow Africa described 

the GES as highly 

successful on several fronts 

including “building a commercial 

agro-dealer network 

that delivered subsidized inputs 

to 1 million farmers in the 

first year and 5 million in the 

second year,” this agro-dealer 

network that would have been 

one of the biggest feats of the 

scheme is today in shambles. 

The FAO, citing the Nigerian 

Agricultural Input Dealers 

Association (NAIDA), in its 

2016 report, affirmed that 

some of the agro input dealers 

who were participating in the 

GESS programme could not 

stay afloat because of their 

pending payments for their 

past supplies. 

Not only have many supplier, 

especially smaller companies, 

been unable to meet 

their financial obligations, it 

has also been asserted that 

some participants in the 

scheme have lost their lives 

due to the non-payment of 

their money by the Federal 

Government, as the burden 

took a toll on their health, with 

no funds to get requisite care. 

fiveNumbers 

N18 billion 

The amount of money still being 

owed to companies that participated 

in the Growth Enhacement Scheme 

(GES) 

300 

The number of companies which according 

to the Agro dealers association, 

participated in supplies under 

the Growth Enhacement Scheme 

(GES) 

1 million 

Number of farmers estimated to have 

been reached in the first year of GES 

5 million 

Number of farmers estimated to have 

been reached in the first year of GES 

60 percent 

Input supplies to farmers can increase by 

as much as 60 percent if outstanding debt 

is paid, making it possible for companies 

to expand their businesses. 

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. 

Tel: +233243226596: email: mail@businessdayonline.com Advert Hotline: 08116759801, 08082496194. Subscriptions 01-2950687, 07045792677. Newsroom: 08022238495 

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

BusinessDay 12 Apr 2018

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