JUNE 11 , 2012

Continues on page 18

BY GODWIN ORITSE ANDGODFREY BIVBERE

Presidential directive on 24-houroperations at the nation’s ports

is being frustrated by disagreementbetween the Nigeria Customs Service(NSC) and maritime operators.

Minister of Finance andCoordinating Minister for theeconomy, Dr. (Mrs.) Ngozi Okonjo-Iweala, recently at a press briefing inNew York during the World Bankmeetings, said that the President hasdirected that port operations must beon 24-hour basis.

Investigations, however, revealedthat the directive is yet to beimplemented. Though stakeholdersagree that the directive is practicableand good for the economy, theyhowever disagree on why it is notbeing implemented. The NigeriaCustoms Service (NCS) attributed thedelay in the implementation to agentsand banks, but maritime operators saidthe NCS is responsible for the delay. Speaking with Vanguard on theissue, spokesman for APM Terminals,Bolaji Akinola, said that 24-houroperations have been going on in theports in Lagos. He explained that theNigerian Ports Authority, NPA, has

24-hour port operations:

Customs,operators frustratepresidential orderbeen carrying out marine operations(pilotage of vessels) on 24-hour basisover the years.

He also pointed out that loadingand off-loading of containers to andfrom ships has been on for a while,stressing that what is missing is theabsence of 24-hour examination ofgoods at the ports by Customs.

Akinola said that another problemthat hinders 24 hours ports operationswas that of insecurity in the country,saying that it makes it difficult for

consignees to take delivery of theirgoods after a particular time of theday.

“Consignees cannot come forwardfor their consignments after certaintime; they cannot take delivery of theirconsignments after certain time of theday because of the security challengesin the country,” Akinola said.

Debunking the claims, PublicRelations Officer, NCS, Wale Adeniyi,said that NCS has drawn up a rosterfor 24-hour operations, although the

schedule is not operational at themoment.

Adeniyi said that the Customsservice had actually commenced 24-hour operations immediately after thedirective but had to stop becauseshipping companies and banks werenot operating the same hour of serviceto complement the 24-hour portoperations.

He said that the Customs hadprepared a roster and had posted menand officers to man its various positions

From left Dr. Olajide Basorun, Permanent Secretary, Ministry of Agriculture and Cooperatives, Lagos State; PrinceGbolahan Lawal, Commissioner for Agriculture and Cooperatives and Mrs. Olufunmilayo Bantefa, Director of Fsiher-ies Services, during a stakeholders' interactive workshop on Aquaculture, jointly organised by CBN and the Ministry,

in Lagos.

CURRENCY BUYING CENTRAL SELLING

CBN Exchange rate as at 08/06/2012

98.70 -0.15

84.23 +0.25

156.10 -2.35

2,155.00 +61.00

19.17 +0.27

CFA 0.2716 0.2816 0.2916

KRONER 25.8642 25.9478 26.0313

EURO 192.261 192.8826 193.5036

POUNDS 237.4942 238.2613 239.0284

RIYAL 41.2745 41.4078 41.5411

SDR 239.8471 240.6218 241.3965

FRANC 159.9835 160.5002 161.0169

DOLLAR 154.8 155.3 155.8

YEN 1.9783 1.9847 1.9911

RENMINBI 24.3081 24.3871 24.4661

18 — Vanguard, MONDAY, JUNE 11, 2012

Cover Story

Continues from page 17

,

,

YOUTH RESTIVENESS AND

UNEMPLOYMENT – THE WAY OUT

(PART 3)

EFFECTS OF UNEMPLOYMENT IN NIGERIAEvery year, over 300,000 graduates are churned out from thetertiary institutions nationwide. This number grows yearly andtranslates into more and more unemployed people littering thestreets of Nigerian cities. Below are some of the effects ofunemployment in Nigeria.Mental health: Mental health problems like: Law self-confidence,feeling unworthy, depression and hopelessness. With the lostincome and the frustration involved in it, the recentlyunemployed may develop negative attitudes toward commonthings in life and may feel that all sense of purpose is lost.Frequent emotions could be – low self-esteem, inadequatenessand feeling dejected and hopeless.Health diseases: The unemployment overall tension can increasedramatically general health issues of individuals.Tension at home: Quarrels and arguments at home front whichmay lead to tension and increased numbers of divorces etc.Political issues: Loss of trust in administration and thegovernment which may lead to political instabilityTension over taxes rise: Unemployment also brings updiscontent and frustration amongst the tax paying citizens. Inorder to meet the demands of the unemployment fund thegovernment many a times may have to increase the taxes thusgiving way to restlessness amongst the tax paying citizens.

Crime and violence: Increasein the rate of crime in thesocietySuicide cases: Increase in therate of suicide attempts andactual suicides as well.Stigma: Unemployment bringswith more than just ‘no work’.It also brings with it thedisgrace that the person has tobear. Nobody likes to be termedas unemployed.Employment gaps: To furthercomplicate the situation thelonger the individual is out ofjob the more difficult itbecomes to find one.Employers find employmentgasps as a negative aspect. Noone wants to hire a person whohas been out of work for sometime even when there’s no faultof the individual per say.

Lose of skills’ usage: The unemployed is not able to put his/herskills to use. And in a situation where it goes on for too long theperson may have to lose some of his/her skills.THE ROLE OF GOVERNMENT.It is the duty and responsibility of the government and differentpolicy makers to provide such an environment and conditionswhich are conducive for the youth entrepreneurial activities.Different policy initiatives encourage and motivate young peopleto come up with new ideas and start their own youth enterprises.This will first reduce the incidence of unemployment to a greatextent and as such would have dealt a massive blow to the problemof youth restiveness.To do this effectively, the policymakers need to realize that alonepublic spending is not going to contribute towards the welfare ofthe youth. It is the policies of the states that must be created in away that will help to stimulate the younger people as well astheir parents and communities to invest in themselves. The mainessence of implementing youth friendly policies is they are notas costly as direct investments but require a lot of political trade-off to actually implement the policies so that they benefit eachand every young person living in the country.

It is the duty andresponsibility of thegovernment anddifferent policymakers to providesuch anenvironment andconditions whichare conducive forthe youthentrepreneurialactivities. Differentpolicy initiativesencourage andmotivate youngpeople to come upwith new ideas andstart their ownyouth enterprises.

at the terminals, but theService had to return its menand officers to their variousposts because the banks andagents were not forthcomingand the agency could notcontinue to waste manpower.

He noted that in a situationwere shipping companies werenot sending containers forexamination and the bankswere not open for agents to paytheir duties, the efforts of theCustoms came to naught.

“If one, two or three agenciesare ready for the project andthe banks and agents who arealso very key to the entireproject are not ready, there isnothing anybody can do aboutit”, he said.

National President of theAssociation of NigeriaLicensed Customs Agents,Prince Olayiwola Shittu, in hisresponse to the position of theCustoms said that it is not truethat shipping companies andbanks hinder theimplementation of the directiveon 24-hour port operations.According to him, “24-hourexamination of consignmentsdoes not need shippingcompanies or banks.” He saidthat what they need areterminal operators who willposition consignments forexamination. Shittuexplained that they recentlyheld a meeting with theComptroller-General ofCustoms, Alhaji AbdullahiDikko, where they requestedfor officers to be posted to theports for weekend operations.

He noted that their requestwas granted and the Customsboss promised to direct theCustoms Area Controllers,CAC, at the various ports totake action. The ANLCA bosshowever, noted that midnightports operations is possible butmay not be realistic for now as

24-hour port operations: Customs,operators frustrate presidential order

a result of the challengingsecurity situation in thecountry.

He explained that terminaloperators are ready forweekend operationsand containers examined overthe weekend are those that willproceed for delivery during theweek. He said that theadvantages of weekendoperations are very many,saying that agents should takeadvantage of it. He furtherpointed out that with sincerityon the part of all stakeholdersin port operations, 24-hourcargo delivery will be possible.

He averred that 24-hour portoperation is possible andpracticable, adding that therecently introduced biometricidentification card for agentscan be used for duty payment.

Dikko said that Customs nowcarry out examination ofcontainers at weekends andthis, according to him, hasgone a long way to quickencargo delivery process.

He explained that an agentcan upload his invoiceelectronically and make dutypayment through the sameprocess, noting that it is onlythe terminal operators andshipping firms that wouldupgrade their systems andoperations to make themassessable electronically.

“We are currently workingwith some terminal operatorsto upgrade our portal so as tomake them assessable for e-payment. It is operators whowant to continue in theircorrupt way of life that willthink and say that 24-hour portoperation is not possible,” headded. General Manager incharge of Public Affairs, NPA,Chief Michael Ajayi, said thatNPA has been operating on a24-hour basis even before theport was concessioned.

Ajayi stated that NPA hasbeen running a shift system

from the time it was created;adding that 24 hours portoperations is not new to itsmanagement. He also said thatbesides the NPA and theNigeria Customs Service beingready for 24 hours portoperation, there is need forothers, particularly thebanking sector to key into theproject, adding that when fullyimplemented, it would createjob opportunities in virtuallyevery sub-sector of theNigerian maritime industry.Ajayi explained that with thecashless policy of the CentralBank of Nigeria (CBN),importers and agents can payimport duty electronically andconfirm same to the Customsthrough the same means.

The NPA spokesman addedthat importers can do theirdocumentation in the night andtake delivery of their cargo inthe morning so as to beatsecurity challenges at night.On the issue of added cost toterminal operators, Ajayiexplained that a high turnoverof container operations willlead to high financial turnover, more revenue for bothCustoms and NPA, explainingthat more jobs will be createdand the economy will be betterfor it. On his part, ManagingDirector of Cotecna DestinationNigeria Limited, CDNL, Mr.Tayo Rabiu, in an interviewwith Vanguard, said thatCotecna has since commenced24- hour service at both Tincanand Apapa ports. Rabiuexplained that they do this byposting their workers in shiftto ensure that scanningoperations go on 24 hours atthe scanning sites. On whetherscanning services are carriedout at the bonded terminals, theCotecna boss said that theyare not doing so presently butstressed that they have thecapacity to do so should theybe directed to.

The AgriBusiness Food Security Summit Tittle: Enhancing Agriculture Value _ Chain ForEconomic Prosperity,:Sponsor By Accenture Nigeria.Held at Eko Hotel Lagos Pix L- R Mr.Gbenga Ibikunle Executive Director, BATN Mrs Juliet Anammah , Director Real Sector, Ac-ceanture Nigeria Quest Speaker, and Mr Bert J. Ronhaar H. E. The Netherlands Ambassadorto Nigeria Photo By Diran Oshe

Vanguard, MONDAY, JUNE 11, 2012 — 19

,

,

The FederalGovernment in itsreaction to the plane

crash two Sundays ago, hasset up a panel to conduct anaudit of airlines in the coun-try. The audit panel has sixmonths to do its work and sub-mit its findings to government.Nigerian government isknown for reacting to situa-tions instead of being proac-tive.

The audit panel is coming toolate after the nation was need-lessly plunged into mourningby allowing mindless compa-nies to operate airlines withmolue kind of aircraft. Nigeri-ans who live in Lagos andIbadan have experiences ofwhat molues are. They areramshackle vehicles withmindless drivers. Many oper-ate with expired tyres; no tra-ficators, headlights, unserv-iceable engines and theycould enter the road at will notminding the safety of theirpassengers and other road us-ers.

Several times in Lagos, thesemolues with several passen-gers on board, had plungedinto the lagoon with all pas-sengers drowned. Each timeit happened, there will beweeping, condolences and apromise by government to dosomething about them. No-body ever did. Molues on Ni-gerian roads are being phasedout as a result of governmentpolicy which has provided La-gosians with better alterna-tives of land transportation. To-day, Molues are now in the Ni-gerian airspace. Most of theaircrafts in the Nigerian airspace are no better than mol-ues.

The aircrafts are old, the en-gines are unserviceable, yet,they are allowed to fly the Ni-gerian air space. Will the pan-el set up by this governmentbring back the lives of morethan 153 persons who per-ished in that aircraft? Whatsuccour will it bring to the fam-ilies of the victims? Danaplane, a Boeing McDonnellDouglas 83 with registrationnumber 5N-RAM, crashedinto a building in the denselypopulated Iju-Ishaga area ofLagos, less than two minutesto touchdown. One hundredand fifty-three people on-board perished in the trage-dy. These exclude those whowere killed in their homeswhich the aircraft plungedinto. The crash happened lessthan 24 hours after a Nigeri-an cargo plane crashed into apassenger bus in Accra, Gha-na, killing 10 people.

Is the Dana crash the first inthe history of Nigeria civil avi-ation? Certainly not! In all theprevious ones, investigationswere carried out and after themourning period, the systemwent back to status quo. Noth-ing else caused this disasterthan corruption. Thosecharged with the responsibil-ity of ensuring safety in the airspace have sold their con-sciences for peanuts. Theyprefer to sacrifice the lives ofNigerians for peanuts, by col-lecting gifts, free tickets andbribes and look the other waywhen operators are doing thewrong thing.

A lot has been revealed sincethe crash. Why should govern-ment wait for the worst to hap-pen before acting? Why must

Presidential audit panel,for already wasted lives?

we wait till things go bad be-fore we act? Why should wewatch things go this wrong,all because of corruption? Theowners of Dana Airline arethree Indian brothers who hadbeen previously extraditedfrom Nigeria for fraudulentpractices. The crashed planewas said to be a faulty planeknown to both the owners andoperators. The said plane is

BRIEFS

about 22 years old acquiredsome five years ago from USwhen Dana Company floatedan airline. The Aviation Min-istry is said to be in the knowof its deplorable conditionand said it gave a warning.After the crash, everyone istalking; Dana Staff are speak-ing about how the owners in-sisted that the pilot should fly.Governor Akpabio talkedabout his complaints to the air-line after the plane experi-enced failure the week beforethe crash.

Where were the officials ofthe Nigerian Civil AviationAuthority and other relevantagencies that should have ar-rested the situation? It is com-mon knowledge in the avia-tion industry that operators arebecoming very few and arecutting corners. Pilots are giv-en definite instructions, ‘if youhave a snag in an aeroplane,do not put it on your techni-cal logbook, write it on a pieceof paper, when you land, giveit to the engineer.’ Will thefederal authority say they arenot aware of this develop-ment- that it is the airline en-gineers on ground thatdetermine the fitness of aplane to fly? According toairline operators, if theengineer is able to fix areported snag handed over tohim by a pilot, good; if he is

unable to fix the snag, the aer-oplane goes into service be-cause there will be no evi-dence in the check log. Thecheck log is the book thatshows record of complaintsmade by pilots, but in the Ni-

gerian aviation setting today,such a report will not be found.What then will this audit pan-el do? Pass a clean bill ofhealth on Dana Airline?

Before this latest accident,the country had experienceda series of air disasters in therecent past. On May 4, 2002,for instance, an EAS Airline’sBAC 1-11-500 crashed into apoor, densely populated sub-urb of Kano. It burst intoflames, killing 148 people – 76on board and 72 on the

ground. In 2005 alone, twomajor disasters occurred. OnOctober 22 of that year, a Bel-lview Airline’s Boeing 737crashed soon after take-offfrom Lagos, killing 117 peopleon board. On December 10,

2005, a Sosoliso Airline’s DC-9 crashed in Port Harcourt,Rivers State, killing 103 peo-ple, most of whom were schoolchildren. The nation had yetto overcome this tragedy whenan Aviation Development Com-pany Airline’s Boeing 737 alsocrashed shortly after take-offfrom Abuja, killing 104 peopleon board, including the thenSultan of Sokoto, Muham-madu Maccido. This happenedon October 29, 2006.

This particular plane that

crashed two Sundays ago, isalleged to be over 22 years.Though the management ofthe airline claimed that theplane was in good condition,it is imperative to note that theformer Minister of Aviation,Kema Chikwe, had directed,after the Kano crash of 2002,that no plane aged over 22years should fly in the Nige-rian airspace. The manage-ment of the airline, NigeriaCivil Aviation Authority, Min-istry of Aviation officials andthe Minister of Aviation havea lot of explanations to make.Nigerians are waiting!

Is Dana crash the first in thehistory of Nigerian civil avia-tion? Certainly not! In all theprevious ones, investigationswere carried out and after themourning period, the systemwent back to status quo

Bayelsa State Governor, Seriake Dickson,has described as wor-

risome the state's poor Inter-nally Generated Revenue(IGR). He, however, assuredthat his administration wasmaking frantic efforts to re-verse the trend by creatingenabling environment for in-vestors to come into thestate to boost the local econ-omy.

Most of the few businessoutfits including oil multi-nationals, exploring thelarge crude oil deposit in thestate, he lamented, do nothave their corporate officesin Bayelsa in spite of the ec-ological problems caused bytheir operations with the re-sult that they pay taxes toother states where theirheadquarters are located.Dickson stated this duringthe monthly TransparencyInitiatives briefing heldWednesday at the state Ban-quet Hall in Yenagoa.

His words: “We have a bigproblem in generating siza-ble IGR and this is detrimen-tal to the rejuvenation strat-egies aimed at repositioningthe state's economy. Our IGRis even less than what somelocal governments in otherstates generate. We are fac-ing developmental challeng-es and that is why we are in-vesting in peace and securi-ty as catalyst to attract lo-cal and foreign investments.The magnitude of the eco-nomic problems informedour trade mission trip toSouth Africa as part of ourmoves to evolve stronger ped-estal for our economy togrow.”

Bayelsa ruespoor IGR, movesto diversifyeconomy

BY SAMUEL OYADONGHA

20 — Vanguard, MONDAY, JUNE 11, 2012

Business & Economy

BRIEFS

By FAVOUR NNABUGWU

CBN approves N75bnfor NIRSAL’s take-off

The Central Bank ofNigeria (CBN) hasapproved N75 billion

for the take off of NigerianIncentive-Based Risk Sharingin Agricultural Lending(NIRSAL). The apex bank hasalso guaranteed 75 per centloans provided by DepositMoney Banks to farmersacross the 36 States of theFederation and the FederalCapital Territory as part ofconcerted efforts to transformthe agricultural sector.

Head of NIRSAL ProjectImplementation Office underthe Development FinanceDepartment of the CBN, Mr.Jude Uzonwanne, stated thisin Abuja at a presentation onthe role of NIRSAL to theMinister of State for theFederal Capital Territory,Oloye Olajumoke Akinjide.

Uzonwanne stated that theguarantee would be issued bythe NIRSAL to the farmers inthe states and FCT throughcommercial banks and otherfinancial institutions.

He explained, “NIRSALmobilizes financing forNigerian agribusiness byusing credit guarantees toaddress the risk of default.NIRSAL is a flexible financingtool designed to change thebehaviour of financialinstitutions.

“It covers all crops andlivestock activities in Nigeria,while driving improvedinvestment outcomes and jobcreation. It is also building ona legacy of previous CBNinterventions in agriculturethat has helped create

thousands of jobs.”He stated that the CBNprogramme was designed tocreate access to finance byintegrating end-to-endagriculture value chains suchas input producers, farmers,agro dealers, agro processorsand industrial manufacturerswith agricultural financingvalue chains – loan productdevelopment, creditdistribution, loan origination,managing and pricing forrisk, and loan disbursement.“The integration is driven byNIRSAL’s 5 pillars,particularly the Risk SharingPillar and the TechnicalAssistance pillars such as Risksharing Facility (?45 billion),

Insurance Facility (?4.5billion), Technical assistancefacility (?9 billion),

Agricultural bank rating8(?1.5 billion), and Bankincentive mechanism (?15billion).

“NIRSAL will share riskswith banks ranging from 30%to 75% of loss depending onthe segment. We are preparedto offer following terms tofarmers in the States and FCTAbuja: 75% guarantees on allinput, working capital andlimited living cost loans toplant the crop, and loanduration should be about 24 –28 months,” he noted. Theloan guarantee is beingpackaged under the, a publicprivate established by theCBN, the Bankers’ Committeeand the Federal Ministry ofAgriculture and RuralDevelopment.

MSMEs key to success of vision 20-2020,say NBS, SMEDAN

By CHRIS OCHAY I

For the nation to attainits aspiration to beamong the top twenty

economies in the world by theyear 2020, it has to payserious attention towardsdevelopment of Micro, Smalland Medium Enterprises,MSMEs, the StatisticianGeneral of Nigeria, Dr. YemiKale has said.

D r. Kale’s remarks wascontained in a data surveypresented Wednesday inAbuja, which revealed thatMSMEs play a very big rolein the Nigerian economy,contributing about 46% of the

Gross Domestic Product, GDP.The document which is thereport on 2010 nationalMSME was conducted by theNational Bureau of Statistics,NBS, in collaboration theMedium EnterprisesDevelopment Agency ofNigeria, SMEDAN.

The survey was conducted todetermine the level ofcontribution of the sector to theGross Domestic Product;Contribution to employment;Determine the number ofMSMEs in Nigeria on geo-political and sectoral basis;Identify the challenges andconstraints confronting theoperations of MSMEs inNigeria; Identify the skill

gaps within the sector; as wellas to determine the grow rateof MSMEs; among others.

The report presented by DrYemi Kale, StatisticianGeneral and MuhammadNadada Umar Director-General/CEO of SMEDAN.Respectively, said the sectorshows significance and thepotential for growth if theproperly developed“particular as the nationaspires to be among the toptwenty economies in the worldby the year 2020.”

“The Report concludes byhighlighting the challengesfacing the MSME sector inNigeria.

World food pricesdropped in Mayfor a second month

in a row, hit by steep falls indairy products, sugar and oth-er commodities, and are like-ly to fall further in the com-ing months, the United Na-tions’ Food and AgricultureOrganisation (FAO) said.Food prices grabbed attentionof the world leaders aftertheir spike to record highs inFebruary 2011 helped fuel theprotests known as the ArabSpring in the Middle Eastand North Africa. Food pric-es have fallen since. Im-provement in the security offood supplies amid the eco-nomic downturn was high onthe agenda of a summit ofleaders of the G8 industrialpowers last month. The FAOFood Price Index, whichmeasures monthly pricechanges for a food basket ofcereals, oilseeds, dairy, meatand sugar, averaged 204points in May, down from 213points in April, the FAO saidin its monthly index update.

New Lagos transformerplant will save N1.5b for Ni-geria - NnajiMinister of Power Prof. BarthNnaji has said that the repairof electricity transformers inthe country would save Ni-geria more than N1.5 billion.Nnaji made the disclosure atthe inauguration of the man-ufacturing and repair trans-mission equipment plant ofthe Skipper Group in Lagos.Nnaji said the companywould save for Nigeria, thehuge foreign capital spent onshipping damaged transform-ers abroad for repairs. He re-emphasised the Federal Gov-ernment’s commitment in sup-porting investors in the na-tion’s power sector. Theminister said the projectwould also develop our localcontent by employing Nige-rians in various fields.

World foodprices fall inMay: UN’sFAO

The Central Bank of Nigeria (CBN) says it isworking on a code to

assist it inregulating activities of com-mercial banks. Mr Sola Awo-yungbo, the CBN Director forFinancial Policy and Regula-tions, disclosed this in an in-terview with the News Agen-cy of Nigeria (NAN) in La-gos. He said that the codewould define the calibre ofpeople who would be on theboard of commercial banks inNigeria. “We want to promotethe independence of those onthe board of banks. We musthave independent directorson the board of banks. Theyshould not be shareholders.They should be people whoare independent in their opin-ions. They must, however,have relevant experience. Wewant the appointment of peo-ple of integrity because theyare expected to monitor theactivities of the managementon behalf of the sharehold-ers,” he said.

According to Awoyungbo,the code, which will be readysoon, will highlight the re-quired qualifications and ex-periences of intending bankdirectors. Awoyungba saidthat the apex bank was alsoworking to reduce the strin-gent conditions given to cus-tomers who wanted to openaccounts with commercialbanks.

Singapore’s Olam buys Ni-gerian Food Company

Singapore commoditiestrader Olam International Ltdsaid it bought 100 percent ofNigerian dairy and beveragecompany Kayass EnterprisesS.A. for $66.5 million.

CBN set to regu-late managementof commercialbanks

Osun Government is tospend more thanN27 million on the

first stage of its planned fishfarming project. Dr Wale Bo-lorunduro, the state Commis-sioner for Finance, EconomicPlanning and Budget, saidthis in an interview withnewsmen in Osogbo. Aheadof the initiative, the commis-sioner said the state govern-ment had concluded plans totrain a large number of cadetsfrom its Youth EmpowermentScheme (OYES). According tohim, the state government willpartner with Messrs KayoLad Nig. Ltd. to tap the fullpotential of the fishery busi-ness billed for Odo-Otin Lo-cal Government Area. Hesaid the cadets to be trainedwould thereafter be support-ed by the state government toestablish their own sustaina-ble fish farms.

Osun to spendN27m on fishfarming project

The First Lady of River State Mrs Dame Judith Amaechhi paid a Courtesy call to groupManaging Director of Daimond Bank Plc Dr. Alex Otti in his Office Lagos. From left Mr. VictorEzenwoko, Executive Diractor Regional Businness South, First Lady River State Mrs PameJudith Amaechi, Dr. Alex Otti GMD /CEO Diamond Bank Plc Mrs Caroline Anyanwu -(ED )Risk Management Diamond Bank Plc Mr. Uzoma Dozie - ED Corporate Banking , DiamondBankPlc Photo By Diran Oshe

Vanguard, MONDAY, JUNE 11, 2012 — 21

BRIEFS

Business & Economy

GRC Motorsport to create thousandsof jobs in Nigeria

By EBELE ORAKPO

GRC Motorsport is setto make Nigeria apart of the billion-

dollar motorsport industrythrough partnership with thethird largest sports carmanufacturing company inthe UK. In an exclusive chatwith Vanguard in Lagosrecently, . Ribi Adeshokan,the Chief Executive Officer ofGRC Motorsport said: “Thecompany is a family-runbusiness which started over30 years ago. Not only will webecome their sole distributorto Africa, we will also be partof the team, coming up withthe design, from chassis tobody work, to engine becauseeverything is built in-house.”

Explaining further,Adeshokan said the companyintends to give the youths andstudents the opportunity tocome up with a good cardesign. “We give them a basicshape and expect them to usetheir own initiatives to comeup with better designs. So atthe end of the day, we willpick the best design and useit in the next model of the car.”

According to Mr.Adeshokan, the company isalso seeking sponsors for theactivities of Team NigeriaRacing Eagle.

“The sponsors will sponsorTeam Nigeria and the teambecomes their marketingplatform and one of the key

objectives of the team is tomake sure that the sponsorsare able to get return on theirinvestment so it is not like theyare just going to be givingmoney away without gettinganything in return.Motorsport sponsorship isbeyond brand visibility on thecar or on the suit,” he stated.

Shedding more light on howthe sponsors will benefit fromthe partnership, he said: “We

look at their target audience,their potential and existingcustomers. Number one, howdo we continue or supportthem as a step towardsmaking the existingcustomers happy? Part of whatwe will do is to invite them toour races and while they areat our VIP hospitalityattending our races, weshowcase what the sponsoringbrand is all about in terms of

customer service and thingslike that. Again, the kind ofhospitality and treatment weoffer all our guests is goingto be second to none and thiswill make them very happyand at the same time, we havelots of merchandise which canbe given to new buyers andexisting customers.”

Continuing, he said: “Thereare some unique selling pointswhich we will be coming upwith.

92% Nigerians optimistic about onlineshopping —Survey

BY PROVIDENCE OBUH

A survey carried out byM a s t e r C a r dWorldwide has

revealed that 92 per centNigerians have a strong andpositive sentiment towardsonline shopping.

In addition, 57 per cent ofthose Nigerians who hadshopped online in the threemonths prior to the surveybeing conducted indicatedthat they are likely to continuemaking purchases online overthe next six months.

Country Manager, WestAfrica, MasterCardWorldwide, Mrs.OmokehindeOjomuyide said that Nigerianonline shoppers believedthere are wider purchasechoice online than offline,explaining that shoppingonline was convenient, easyand that most goods werecheaper online than theywere offline.

Ojomuyide pointed out that

MasterCard conducted theresearch to identify the factorsthat influence Nigerians’sentiments towards onlineshopping,

According to her, “shoppingonline is just one way thatNigerians can reduce theirdependence on cashpayments. MasterCard’svision is to create a worldbeyond cash; we arespearheading a focusseddrive towards a cashlesssociety in Africa, wherecashless transactions willassist in improving the livesof the people in thecontinent’s by removing therisks and expenses associatedwith carrying, using andhandling cash.

“These findings are obviousnote for entrepreneurs thatNigerians who are shoppingonline see the value inpurchasing locally, whichcreates a considerablebusiness opportunity for themto enter this exciting retailsector, while it is still in itsearly growth stage.

However, the survey, whichserves as a benchmark thatmeasures consumers’propensity to shop online, wasconducted for the first time inNigeria, in 25 countries fromDecember 5th, 2011 toJanuary 6th 2012 andinvolved 12,500 consumers,

between the ages of 18 and64 who were asked questionsabout their online shoppinghabits.

Meanwhile, the researchalso emphasised the reasonswhy the majority (78 per cent)of Nigerians surveyed do notcurrently shop online.

The Minister of Tourism,Culture and NationalOrientation, Chief

Edem Duke, has expressedthe ministry’s commitment toincrease Nigeria’s Gross Do-mestic Products (GDP) andforeign exchangeearnings. Duke said this atthe African Arts and CraftsExpo (AFAC) with the theme“Promoting the crafts indus-try for economic transforma-tion”, in Abuja on Thursday.The expo was organised bythe National Council for Artsand Culture.

Tourism will boost Nigeria’s GDP,foreign exchange earnings—Minister

He urged Nigerians to har-ness the potential that aboundin arts and crafts industry asa non-oil sector to contributeto the country’s GDP. Theminister said the industrywould significantly assistto combat rural-urban migra-tion, youth restiveness andmilitancy. Duke added thatthe arts and crafts industrywould further empower wom-en and contribute to the real-isation of the MillenniumDevelopment Goals “and in-deed the nation’s achieve-ment of target by 2020”.

Institute tocommissionSCADA/Smart Grid

The Managing Director,National Power Training

Institute of Nigeria (NAPTIN)Mr Reuben Okeke, says theinstitute will soon inauguratea SCADA /Smart Grid to en-sure power stability in thecountry. SCADA is a supervi-sory control and data acquisi-tion or computer system thatmonitors and controls indus-trial, infrastructure, or facili-ty-based processes.

Smart Grid is a digitally-en-abled electrical grid that gath-ers, distributes, and acts oninformation about the behav-iour of suppliers and consum-ers. Okeke said in Abuja thatSCADA would assist the pow-er sector in ensuring thatchallenges in the industrysuch as power transmissionand distribution, and energyconsumption were identifiedand resolved. “We are goingto commission a SCADA andSmart Grid either in July orAugust this year. SCADAisautomation and with its help,one will know exactly what thedistribution man is doing withthe system anywhere in thecountry. It has Remote Termi-nal Unit which enables anengineer at the National Con-trol Centre, Osogbo, togive command to an engi-neer, in Benin for instance, toswitch- off a particular unit ofpower.

African CocoaInitiative toestablish100,000cocoa farms in4 Africannations

The Global Develop-ment Alliance Pro-gramme has released

13.5 million dollars to AfricanCocoa Initiative (ACI) to es-tablish 100,000 farms in fourcountries to boost cocoa pro-duction. Mr Scott Wallace, theCountry Representative of In-ternational Centre for SoilFertility and Agricultural De-v e l o p m e n t ,(IFDC) said in Abuja onThursday that the four coun-tries were Nigeria, Ghana,Cameroon and Cote d’Ivoire.Wallace said that the ACI’sfive-year programme, whichbegan in January, would helpto develop the cocoa sector inthe four countries in four crit-ical areas.

From left: Winner and student, Mr. Tony Willie; Dean, Student Affairs, Prof. Akporuno Temi;Director of Sports, Achugbue Tony; Vice-Chancellor, Prof. Eric Arubayi and Analyst, SocialMedia, Etisalat Nigeria, Ms. Onyinye Egwudo during the presentation of a brand new Hy-undai i10 at the Etisalat Cliqfest campus tour in Delta State University on Friday, May 25th

22 — Vanguard, MONDAY, JUNE 11, 2012

Banking & Finance

Opposition to thep r o p o s e damendment to the

enabling Act of the CentralBank of Nigeria (CBN)designed to remove theautonomy of the apex bankgathered storm last week asstakeholders in the bankingindustry led by the CharteredInstitute of Bankers of Nigeria(CIBN), Nigeria DepositInsurance and other topbankers spoke against themove insisting that anindependent central bank isthe global best practice.

The National Assemblywants to review the CBN Act2007 among other things toenhance the powers of theBank to prohibit transactionswith Foreign Currencies inNigeria; compel the Bank tosubmit its Annual Budgetbefore the National Assembly;alter the governance structureof the Bank and for RelatedMatters.

Specifically, the NationalAssembly wants the CBN, likeother ministries, departmentand agency (MDAs) of thefederal government to submitits annual budget forapproval. It wants to removethe deputy governors from theboard of the CBN. Theamendment also seeks tomake an independent personappointed by the federalgovernment the Chairman ofthe Bank’s board while theCBN Governor will just bethe chief executive.

While stakeholders supportthe amendment to empowerthe CBN to prohibittransactions in foreigncurrencies in Nigeria, theyhowever oppose subjectingthe Bank’s budget tolegislative approval and theappointment of anindependent person aschairman of the board.

On the empowerment of theapex bank to prohibittransactions in foreigncurrencies, the CIBN said,“As it relates to prohibition ontransactions with foreigncurrencies, we are of the viewthat the proposed amendmenthas good intentions tostrengthen the position of theNaira as the legitimate legaltender in Nigeria; enhancemonitoring and accountabilityof the foreign currencies incirculation; and reduced thepossible inflationary effect”.

The NDIC also supportedthe move saying, “All

monetary transactions inNigeria should be based onthe local currency, the Naira.The practice where sometransactions are quoted inforeign currencies is alien tobest practices. Consequently,we strongly support theproposed amendment”.

But on the submission ofbudget and independentchairman of the CBN Board,CIBN said, “A survey of 35central bank boards, incountries at various levels ofdevelopment revealed that,without exception, the

Opposition to removal of CBN’sautonomy gathers storm

By BABAJIDEKOMOLAFE

,

,Central Bank Governor act asChairman of the Boards ofthese central banks. It is alsopertinent that, in Mexico andKorea, there are no externaldirectors, as their CentralBank Boards consist solely ofthe governor and a number ofdeputy governors.

According to Mr. SegunAina, OFR, FCIB, President/Chairman of Council whomade the presentation on be-half of the Institute and thebanking industry, “The com-position of the Board proposedby the Bill effectively reducesthe impact of the CBN’s Man-agement on board decisionsand may lead to unintendedconsequences.

“The proposed amendmentwill undermine theindependence of the CBN indischarging its functionssatisfactorily to achieve thedesired macroeconomic

stability for the growth anddevelopment of the economy.

“The ability of the Centralbank to speak out, if needed,and possibly in critical termswith respect to economic andbudgetary policies, mightalso be impaired.”

NDIC on its part said thatsubjecting the budget of theapex bank to legislative ap-proval process poses majorchallenge to the ability of thebank to function effectively. Itsaid, “At first sight, it mayappear imperative for theCBN to use the budget proc-ess being adopted by Feder-al Agencies/Parastatals. Thismethod would include theuse of the following commonbudgetary devices: display-ing both gross receipts andoperating expenses; its assettransactions; and projectingoutlays of expenditures andreceipts for five years into the

future and from there gener-ate a budget for the fiscalyear for accountability andcontrol purposes, among oth-ers. While the foregoing maybe feasible, its application tocentral banks will no doubt,create major problems fortheir operations. In the caseof CBN, this problem is par-ticularly serious becausemany of the asset transac-tions of the CBN result fromits efforts to influence thepace of growth of the econo-my through its control overmoney supply and these arenot comparable to the assettransactions of other agen-cies. Projecting cash flowsthat include asset transac-tions would pose specialproblems for the CBN be-cause they cannot be easilypre-determined. Moreover,the separation of monetarypolicy expenses from otherexpenses cannot be easilyaccomplished because ofshared support and overheadcosts.”

Similarly, a Past President and Chairman of

Body of Past Presidents ofthe Institute affirmed the po-sition of the Institute by say-ing that the apex bankshould continue to have itsoperational and financialautonomy and the budgetshould not be subjected tofinancial appropriations. “Istrongly implore members ofthe Senate and House of As-sembly to leave the CBN Act

alone as it was conceived bythe founding Fathers in 1958”.

Another Past President of theInstitute, HRH Prof. GreenNwankwo, OON, FCIB along-side Managing Director/ChiefExecutives of Banks spoke-outin total support of CBN auton-omA top banker, Vice Chair-man and Chief Executive Of-ficer, Ancoria Investment andSecurities Limited, Dr. Oluso-la Dada, also maintained thatall over the world, centralbanks are independent. Dadaadvised that the CBN Actshould not be amended suchthat the apex bank will be re-porting to the ministry of fi-nance, insisting that the Bankought to report directly to thePresidency. “In this era of glo-balisation, Nigeria cannot af-ford not to follow the globaltrend. A truly independent andautonomous CBN has becomemore imperative for the inte-gration of our financial systemwith the world economy ingeneral and the West Africansub region in particular.

“What is required now is notto erode the financialautonomy of the CBN butrather to build and strengthenrelationships that wouldenhance complementary rolebetween the monetary and thefiscal authorities, and ensureaccountability andtransparency,” he added.

This position was re-echoedby the Managing Director/Chief Executive Officer,Maxifund Investments andSecurities Limited, Mr.Okechukwu Unegbu.

Unegbgu, who was a formerChief Executive Officer of thedefunct Citizen InternationalBank, warned that amendingthe CBN Act would distort thesystem.

He made these remarks atthe Zenith Bank sponsoredFinance CorrespondentAssociation of Nigeria(FICAN) bi-monthly forum thatwas held in Lagos recently. Hespoke on the topic: “Banks’Financial Performance in 2011and Q1 2012: Implication forthe Capital Market.”

He added, “Why is theNational Assembly trying toamend the CBN Act? Thereason and only reason isbecause there is one strongcharacter that had taken themon. We should be thinking ofbuilding strong institutions, sothat anybody who gets there,whether the person is weak orstrong, will continue to evolvein the system.

“We wrote a memo to theNational Assembly, tellingthem that it is not right to dothat. We fought for the financialand instrument autonomy ofthe CBN and so people cannotjust destroy it.

The ability of the Centralbank to speak out, ifneeded, and possibly incritical terms with respectto economic andbudgetary policies, mightbe impaired

Sanusi Lamido

Vanguard, MONDAY, JUNE 11, 2012 — 23

Banking & Finance

BRIEFCashless: CBN to acquire newfraud prevention system•As banks deploy 100,000 PoS terminals

By BABAJIDEKOMOLAFE

The Central Bank ofNigeria (CBN) is set to

acquire a new fraudprevention system to boostthe cashless Nigeriainitiatives

Meanwhile banks in thecountry have deployed100,000 Point of Sale (PoS)terminals and are expectedto deploy 50,000 more beforethe end of the year.

Head, Shared Services atthe Central Bank of Nigeria(CBN), Mr Chidi Umeano,who disclosed this in Lagos,said banks are expected tohave deployed over 150,000 PoS terminals by the endof this year.

Banks have continued toroll out more innovativeelectronic payment platformsto meet customers’expectations. Currently,banks have deployed about100,000 PoS terminals andbefore the end of the year, ifthings go as planned, about150,000 PoS terminals willhave been deployed.

“The cash-less project is oncourse and the initialchallenges are beingovercome,” he said.

He said the CBN is set toacquire a new fraudprevention system, paymentssystem oversight and anti-

fraud system, to tackle fraudin the electronic payment (e-payment) system.

He said the goal of thesystem is to provide thefacility to distinguishfraudulent and legitimatetransactions based onredefined checks in onlinepayments. This will allow onlylegitimate transactions to beprocessed.

The CBN he said believesthe adoption of the system willboost the cash-less initiativeby strengthening theprotection against fraudulentpayment activities. Fraud hasalways been one of the biggest

challenges of any onlinepayment system. Increasingfraud rates around the worldhas dampened the growth ofelectronic payment byexposing merchants tosubstantial losses andunnerving security-consciouscustomers.

“The fraud detection systemwill help detect potentialfraud situations through thegeneration of online alerts asa result of transactionanalyses,”

Umeano said.He said this would help the

apex bank in the efficientdocumentation of potential

fraud situations, as well asfacilitate identification andcapturing of fraudsters.

Aside the payments systemoversight and anti-fraudsystem, Umeano noted thatCBN, as part of measures tomanage fraud on the e-payment landscape, had in2010, effected migration fromthe magnetic stripe-basedpayment tokens, to the Chipand Personal Identity Number(PIN)-compliant channelsand tokens, thereby recordingover 90 per cent drop in card-related fraud incidents.

He added that the CBNinstituted an industry ATMAnti-fraud Committee, whichwas adjusted to become theE-Payment Fraud Forum, agroup that ensures that anti-fraud mechanisms are keptabreast of new challenges forproactive responses.

Conequently, Umeanocalled on the National

Mainstreet BankLimited has drawn a

road map to attain marketleadership in its bid tovalidate the confidence of itsshareholder and retain theloyalty of its customers acrossNigeria.

Rising from a StrategyMeeting that was fullyattended by all members inLagos over the weekend; theBoard of Directors of the Bankdeclared its intention topursue a set of initiatives andstrategies that would returnMainstreet bank to the leagueof Nigeria’s top four banks. According to a statement, atthe Strategy Meeting, thelocal business environmentwas thoroughly analysed andthe relevant market segmentsclearly defined to pinpointwhere Mainstreet Bank

IMF predicts 8%growth for China

With global demandslowing and

heightened risks, particularlyfrom Europe, weighing on theworld economy, China’sgrowth rate is expected tomoderate in 2012 to around 8percent from 9.2 percent lastyear, the InternationalMonetary Fund (IMF) said inits annual health check of theworld’s second-largesteconomy. But First DeputyManaging Director DavidLipton said inflation wasunder control and Beijing hadroom to support activity incase of a more serious globaldownturn. China’s growth in2010 was above 10 percent.

He welcomed a decision bythe People’s Bank of China tocut interest rates by 0.25percent, which “confirmed theauthorities’ commitment toachieving theirmacroeconomic objectives inthe face of slowing growth andincreased downside risks,especially from Europe.”

The medium-term prioritywas to shift China’s economytoward a more consumer-based growth model that alsoaims to address risinginequalities by promotingmore inclusive growth. TheIMF team was led by MarkusRodlauer. Lipton made theseremarks after joining the finalpolicy discussions in Beijing.He met with Chinese VicePremier Wang Qishan andheld in-depth discussionswith People’s Bank of ChinaGovernor Zhou Xiaochuan,Finance Minister Xie Xuren,and other senior Chineseofficials. “This transformationwould substantially boostliving standards in China andcontribute significantly tostrong and balanced globalgrowth,” Lipton told reportersin Beijing. The IMFsupported China’s ongoingeffort to promote higher-quality growth while at thesame time fine-tuningmacroeconomic policies tohelp ensure that growth doesnot slow too much. China’stimely and large economicstimulus in 2009–10 hadsucceeded in supportingdomestic growth, shieldingChina’s population from theworst of the crisis, andhelping the global recoveryby providing a needed lift toworld demand, he said.

“China again has space fora forceful response ifnecessary,” Lipton added.However, any stimulusshould be provided throughbudgetary measures andgeared toward supporting theobjective of medium-termrebalancing.

Mainstreet Bank board sets strategic agenda,eyes market leadership

would operate at full speed fora stronger positioning andrapid result.

The bank’s Board ofDirectors also assuredcustomers and otherstakeholders that MainstreetBank would soon take itsposition as one of the top fourbanks in Nigeria performanceindices and innovativeproduct offerings.

Emphasizing his optimismon the strategic direction ofthe bank, Chairman of theBoard, Mallam Falalu Belloobserved that a carefulimplementation of theStrategy would translate inthe shortest possible time, tobetter customer experience,efficient and effectiveoperations and posting ofcompetitive returns oninvestment for the

stakeholders. “Our new strategy digs

very deep into Mainstreet’sbusiness potentials andcapabilities and maps outways to optimally deploythem for market leadership”,Mallam Falalu Bello assured. Reiterating the importanceof the bank’s new strategicdirection, the GroupManaging Director/CEO ofMainstreet Bank, FaithTuedor-Matthews expressedconfidence in the new focusof the bank.

According to her, “We haveset ambitious but attainablebusiness goals for ourselves.The Board and Managementare committed to givingMainstreet Bank a strongerfoothold in the market with astricter adherence to bestbusiness practices,operational excellence andother turn around benefits”.

The Group ManagingDirector further pointed outthat Mainstreet Bank hasmany numerous strength thathave placed it in a vantageposition for success.

“ We have over 220branches that are evenlyspread out across the lengthand breadth of this countryand a large customer base thatremains loyal to us,” Tuedor-Matthews observed pointingout that the bank waspresently repositioning itsbusiness to meet theexpectations of allstakeholders.

It would be recalled thatMainstreet bank recentlyannounced a plan to re-organize its business forefficiency and greaternimbleness, giving a windowof opportunity to staff whohad attained the retirementage to voluntarily retire fromthe bank.

24 — Vanguard, MONDAY, JUNE 11, 2012

Corporate Finance

IOSCO plansconsultation onsecuritisationregulation

BY OLAYEMI FOFAH

The International Organization of Securities Commissions (IO-

SCO) said it has published aConsultation Report on Glo-bal Developments in Securi-tization Regulation, aimed atgetting comment on policy is-sues arising from the workof its Task Force on Unreg-ulated Markets and Prod-ucts (TFUMP)

According to a statementby Carlta Vitzthum, spokes-person for IOSCO, the pa-per which provides back-ground to IOSCO’s workand a snapshot of global se-curitization activity makesobservations about regula-tory approaches in jurisdic-tions covered by the work,outlines and assesses theextent of differences andmakes policy recommenda-tion addressing differencesin approaches to risk atten-tion and measures improv-ing transparency to stand-ardize disclosure.

Commenting on the issue,EdouardVieillefond, TaskForce co-Chair and Manag-ing Director of the Autoritédes Marchés Financiers(AMF), said, “The consul-tation paper which followsanalysis of regulatory devel-opments in over twenty ju-risdictions provides us withan opportunity to work to-ward greater harmonizationin our approach to regula-tion of this important sec-tor. We look forward to re-ceiving industry views onthe measures we propose.”

Also speaking, Greg Med-craft, Co-chair of TFUMPand Chairman of the Aus-tralian Securities and In-vestments Commission(ASIC), said, “The consul-tation paper continues theleading role IOSCO hasplayed in supporting thesustained recovery of secu-ritization markets globally.

“It again focuses on theimportance of securitizationas a market-based source offinance and the role crossborder issuances play indeepening markets andsupporting growth in thereal economy.”

Vitzthum further statedthat the consultation paperis in response to a requestfrom the Financial Stabili-ty Board (FSB) as part of itswork to strengthen over-sight and regulation of theshadow banking system, asit is based on a survey ofmember jurisdictions andbuilds on earlier work un-dertaken by staff of the USSecurities Exchange Com-mission and the EuropeanCommission on develop-ments.

BRIEF

position at the airport.”The ASL boss stated that

already, the company hascommenced supply of portablewater to airlines flying intoNigeria, adding that it hascompleted development of firstclass international standardbusiness class lounge, a neweatery in the departure hall,while renovation works on anew business class smokinglounge is on-going.

Speaking at the meeting, ashareholder, Mr.LazarusOnwuka, said there was needto strengthen the marketingdepartment in readiness forthe anticipated competitionfrom the foreign firm.

He said that a situationwhere the company’s turnoverhas been stagnated over aperiod of five years was callsfor concern, saying thatcompetition might furthererode its bottom-line.

The company recordedturnover of N3.599 billion, oneper cent reduction over N3.562billion reported in 2010.

From left: Mrs Folashade Ode, Company Secretary, Senator Ike Nwachukwu, Chairman andSuleiman Yahyah, Vice Chairman, all of Nigerian Aviation Handling Company Plc (NAHCOAviance) at the 31st Annual General Meeting of the company in Abuja.

CBN proposed code toaffect quoted banks

PETER EGWUATUwith Agency Report

Indications have emergedthat the proposed code toregulate banks will likely

affect those quoted on theNigerian Stock Exchange(NSE).

The Central Bank of Nigeria(CBN) says it is working on acode to assist it in regulatingactivities of commercial banksand this will affect both quotedand unquoted banks.

Mr Sola Awoyungbo, theCBN Director for FinancialPolicy and Regulations,disclosed this in an interviewwith the News Agency of

Nigeria (NAN) last week inLagos.

He said that the code woulddefine the calibre of peoplewho would be on the board ofcommercial banks in Nigeria.

“We want to promote theindependence of those on theboard of banks. We must haveindependent directors on theboard of banks. They should

not be shareholders.“They should be people who

are independent in theiropinions. They must, however,have relevant experience.

“We want the appointment ofpeople of integrity becausethey are expected to monitorthe activities of themanagement on behalf of theshareholders,” he said.

According to Awoyungbo,the code, which will be readysoon, will highlight therequired qualifications andexperiences of intending bankdirectors.

Awoyungba said that theapex bank was also workingto reduce the stringentconditions given to customerswho wanted to open accountswith commercial banks.

“The CBN is working onthird party identification forbank customers who engagein minimal transactions incommercial banks.

“Since they aren’t operatinghigh volume transactions, theydo not expose the banks tohigh risks.

“These people can beidentified by a clergy orsomebody who is wellrespected in the society. Thiswill guarantee financialinclusion for people in thiscategory,” he said.

He said that the CBN wasalso working on creating aplatform that would enlightenthe public on the kind ofservices to expect from banks.

“We are reviewing theguidelines for bankingservices. We want to articulatethese services through radiojingles, newspaper advertsand road shows.

“This will create awarenessin the public about their roles,responsibilities andexpectations from banks. Itwill also minimise the frictionbetween the banks and theircustomers,” Awoyungbo said.

ASL decries competition, plans diversificationto non-aviation sector

…proposes 20 kobo dividend

NKIRUKA NNOROM

Airline Services andLogistics Plc hasdisclosed plans to

diversify its operations intonon-aviation sectors of theeconomy due to increasingcompetition in in-flightcatering services.

Making the plans known inthe company’s yearly meetingin Lagos, the ManagingDirector, Mr. Richard Akerele,said the decision to veer intoother sectors was informed byanticipated entry of a foreignfirm into aviation cateringbusiness, saying that it mighteventually affect thecompany ’s overallperformance.

Akerele, who informed thatthe strategy will take effect in

2013, observed that the movehas had significant impact onits resources, resulting inincreased costs over the years.

He said, “Your company hasnow made an in-road into non-aviation sector and is poisedto take off in the coming year.This is especially relevantwith the imminent entry intothe market of a majorinternational player, “Servair”.It has commenced theconstruction of its facility inLagos and should commenceoperation in the last quarterof 2012.

In order to counter losses inrevenue from customersmoving to Servair,management is exploringopportunities in catering forschools and Governmentowned hospitals in LagosState. Negotiations are on-

going in this regard and thisinitiative, if successful, willhave significant positiveimpact on your company’srevenue and reduce anyadverse effect of a new playerin the aviation sector.”

Though he said that themove has not been easy dueto the cumbersome and veryslow nature of development inthe economy in one hand, andextensive evaluation processin the oil sector on the otherhand, he noted, “Our highstandard of hygiene,industrial know-how andexperience will stand to ouradvantage in both theeducation and health sector. Inaddition, we are very muchinvolved in discussion toprovide cold chain logistics forfood industry, thus takingadvantage of our unique

Vanguard, MONDAY, JUNE 11, 2012 — 25

Corporate Finance

From left: Florence Essien, Dealer Specialist, Lagos-South Region, Etisalat Nigeria;Olujinmi Tella, Head, Regional Sales, Lagos/South West Region, Etisalat Nigeria;Ndukauba Chukwu, one of the winners in the Top Best Distribution Partners category atthe Etisalat Heroes Award and Emmanuel Ilori, Regional Distribution Manager, Lagos-South Region, Etisalat Nigeria at the presentation of a Toyota Land Cruiser, Prado(SUV) to Chukwu in Lagos.

NAHCO Aviance increases authorisedcapital, eyes African expansionBY MICHAEL EBOH

Nigerian AviationHandling Company Plc,NAHCO Aviance, hasannounced plans toexpand its operations toother parts of the Africancontinent.

To actualize this,shareholders of thecompany gave themanagement the go-ahead to shore up itscapital base to N3billion.

The shareholders atthe 31st Annual GeneralMeeting of the companyin Abuja, authorised theBoard of Directors toincrease the authorizedshare capital of thecompany from N1.5billion to N3 billion.

The Board of thecompany had proposedthe increase, saying itwill aid the proposedexpansion of the

company’s business toother parts of Africa.

The shareholders, afterconsidering theachievements of thecompany in the last oneyear and itsdiversification drive,considered it necessaryto increase theauthorized capital.

The company’sshareholders alsoapproved the finalpayment of 25 kobo pershare and declaration ofa bonus of one ordinaryshare for every fiveordinary shares.

The company alsoannounced that itsChairman, Senator IkeNwachukwu, will retirebefore the end of theyear and would bereplaced by the ViceChairman, AlhajiSuleiman Yahyah.

According to thecompany, Nwachukwu

joined the Board of thecompany in 2008, as arepresentative of theRosehill Group, anindigenous companythat has 9.5 per centstake in theorganization, while hewas elected Chairman atthe 29th AGM held inIbadan in May 2010.

On becoming theChairman, the companystated that Nwachukwupromised to turn aroundthe company in twoyears, adding that inJuly 2010, he initiated ar e - o r g a n i s a t i o nprogramme which led tothe recruitment ofprofessionals to manstrategic offices of thecompany, equipmentrenewal and training ofstaff.

Among hisachievements, thecompany stated,includes the

ARM Research assigns buy ratingon Fidelity Bank’s shares

By NKIRUKA NNOROMA

group of analystsat ARM Research,

an independentresearch and equityfirm, has assigned buyrating on shares of

Fidelity Bank Plc, sayingthat they had to revisethe estimate upwardsbased on performancesurprises by the bank.

They observed that therating was underpinnedby the significant upsidepotentials of the bank’sfinancials supported byattractive valuations,adding that share pricewould likely hit N3.28by year end.

By this rating,investors are required toincrease their patronageof the stock except onportfolio realignmentconsideration.

“Fidelity Bankreported gross earningsof N22.4 billion for 3months ended March2012; a 46 per cent Year-on-Year, YoY, growth.PBT and PAT rose 140per cent and 137 percent YoY, respectively toN4.2 billion and N3.4billion. Topline growthwas driven by interestincome.

In line with industrytrend in first quarter of2012, Fidelity bankreported robust top-lineperformance whichlargely reflectssignificantly higherinterest rates during thequarter compared to thecorresponding period in2011. Interest incomerose 76 per cent YoY toN17.6 billion in tandemwith 40 per cent loangrowth and over ten-foldincrement in investmentsecurities YoY,” said thereport by the analysts.

They further stated,“We estimate, CAR at 35per cent, which is morethan sufficient to drivegrowth in the mediumterm, in our view, buthave tempered ourexpectations for riskasset creation in thenear term in view ofheightened competitionin the industry and

elevated money marketyields.

“We expect interestincome to remain themain driver of revenuegrowth and have revisedour gross earningsestimates higher to N90billion for full year,2012, to account for thestronger run-rate inquarter one figures,driven by higher assetyields (13.4 per cent)than we expected (9.5per cent).”

The analysts noted thatthe recent rapidimprovement in cost-to-income ratio may havecaptured most of thebenefits from cost-cutting initiatives,saying that it isexpected that the currentlevels of 65 per cent maypersist over the forecasthorizon.

“Our expectations forprovisioning aresimilarly benign overour forecast horizon;driven by similar factorsfor the current year andwe expect cost of risk toremain stable at ~2 percent,” the report added.

The analysts statedthat based on recentbranch expansion drive,the bank will be able tosustain its depositgrowth, saying thatbranch networkexpansion is expected tobe the main driver ofbalance sheet growthgoing forward.“Furthermore, in linewith Fidelity’s resurgentrisk appetite, havingsystemically reducedNPLs over the course ofthe last two years, weexpect loan deposit ratiowill recover to historicalfour-year average overour forecast horizon. Weexpect some recovery inthe contribution of non-interest income withincreasing throughputfrom Fidelity’s largerbranch network,” itfurther stated.

26 —Vanguard, MONDAY, JUNE 11, 2012

Stock Market

Share value on NSEdepreciates by N338.34bnBY MICHAEL EBOH &CHINEDU IBEABUCHI

Equities’ value on the NigerianStock Exchange, NSE,represented by the market

capitalization, dipped last week byN338.339 billion.

The capitalization which opened theweek at N7.005 trillion shed 4.83 percent to close the week at N6.666trillion.

The All-share index also dipped by1,060.92 basis points or 4.83 per centto close the week at 20,902.95 pointsfrom 21,114.64 points at which itopened.

The decline in the market indices wasdriven by losses on the prices of majorblue chip companies, led by Dangote

Cement Plc, witha share pricedepreciation of9.12 per cent orN10.24 to closethe week atN102.01 pershare; NigerianBreweries Plcfollowed with adepreciation of8.57 per cent orN9 to close atN96 per shareand JuliusBerger NigeriaPlc dipped byN3.93 to close atN29.08 pershare.

Other shareprice losersinclude: UACNigeria PlcN3.40, AshakaCement PlcN1.63, ConoilPlc N1.27,Oando PlcN1.04, AccessBank Plc N0.86,Chemical and

Allied Products Plc N0.85 and FirstBank of Nigeria Plc N0.70 amongothers.

Conversely, Guinness Nigeria Plcled 21 other companies on the pricegainers’ category, with a share priceappreciation of 2.24 per cent or N5.01to close the week at N229 per share;Lafarge Wapco Cement Plc followedwith a share price gain of N0.81 or 1.97per cent to close at N42.01 per shareand University Press Plc garneredN0.61 to close at N4.60 per share.

Other share price gainers in theweek under review include: May &Baker Nigeria Plc N0.37, National SaltCompany Nigeria Plc N0.31, PZCussons Nigeria Plc N0.30,Transnational Corporation of NigeriaPlc N0.24, Rt. Briscoe Plc N0.21,Japaul Oil and Maritime Services PlcN0.15 and Neimeth InternationalPharmaceuticals Plc N0.12 amongothers.

Equities trading dipped by 12.14 percent as investors exchanged 1.143billion shares valued at N8.861 billionin 18,880 deals, in contrast to theprevious week’s turnover of 1.301billion shares valued at N9.46 billionexchanged in 14,792 deals.

The Financial Services sectorrecorded the highest transaction in thesectorial analysis, accounting for 73.58per cent of the market turnover, with840.921 million shares valued atN6.157 billion in 11,038 deals. TheConglomerates Sector followed,accounting for 10.06 per cent of themarket turnover with 114.532 millionshares valued at N256.813 million in1,014 deals.

The Banking sub-sector in theFinancial Services sector enjoyed themost patronage, trading 700.158million shares valued at N6.074 billionin 10,559 deals; representing 61.24 percent of the total market turnover.

Transaction in the Banking sub-sector was driven by First Bank of

Nigeria Plc., Zenith Bank Plc andGuaranty Trust Bank Plc. Trading inthe shares of the three banks accountedfor 391.553 million shares,representing 55.92 per cent, 46.56 percent and 34.28 per cent of the turnoverrecorded by the sector, sub-sector andtotal equities turnover for the week,respectively.

Regency Alliancerecords 13% profit

Regency Alliance Insurance Plc hasannounced a profit after tax ofN262.816 million for its 2011 auditedfinancial statements.According to the results for the yearend, December 31, 2011, presented tothe Nigerian Stock Exchange, NSE, itsafter-tax profit rose by 12.79 per centfrom N233.017 million recorded in its2010 financial year.The company recorded Direct Premiumof N2.413 billion, rising by 17.31 percent from N2.057 billion in 2010.The company recorded Net assets of4.854 billion, up from N4.733 billionrecorded in 2010.

Vanguard, MONDAY, JUNE 11, 2012 — 27

Un

ion

Dia

gn

ost

ics

& C

lin

ica

ls S

erv

ice

s0.5

00.5

012,0

00

0.5

00.5

00.0

00.0

0

Ph

arm

ace

uti

cals

Ek

oco

rp P

lc5.0

55.0

516

85.3

15.3

10.0

688.5

0E

va

ns

Me

dic

al P

lc0.5

00.5

071,1

01

1.4

50.7

00.0

00.0

0F

idso

n H

ea

lth

care

Plc

0.8

80.9

01,4

56,4

75

3.2

00.8

30.2

73.0

7G

laxo

Sm

ith

kli

ne

Co

nsu

me

r N

ig21.0

021.0

0105,2

87

29.6

523.1

12.5

88.8

8M

ay

& B

ak

er

Nig

eri

a P

lc1.4

11.7

886,5

32

5.6

13.6

10.2

19.0

5N

eim

eth

In

tern

ati

on

al P

ha

rm0.6

00.7

2230,0

00

1.9

60.9

50.0

814.1

3N

ige

ria

-Ge

rma

n C

he

mic

als

Plc

8.5

98.5

910

12.9

10.9

50.0

00.0

0P

ha

rma

-De

ko

Plc

3.5

03.5

010

020

04.2

80.0

00.0

0

ICT

Co

mp

ute

r B

ase

d S

yst

em

s10

8C

ou

rte

vil

le I

nve

stm

en

t P

lc0.5

00.5

016,1

00

0.5

20.5

00.0

510.0

0

Co

mp

ute

rs a

nd

Pe

rip

he

rals

Om

ate

k V

en

ture

s P

lc0.5

00.5

01,0

00

0.5

00.5

00.0

412.5

0

IT S

erv

ice

sN

CR

(N

ig)

Plc

13.8

013.1

226,2

38

9.3

13.2

56.4

91.4

3T

rip

ple

Ge

e a

nd

Co

mp

an

y P

lc2.6

62.6

675

03.5

93.2

50.0

00.0

0

ICT

Tele

com

mu

nic

ati

on

sS

tarc

om

ms

Plc

0.5

00.5

030,0

00

1.4

70.5

00.0

00.0

0

IND

US

TR

IAL

GO

OD

SB

uil

din

g M

ate

ria

lsA

sha

ka

Ce

me

nt

Plc

10.5

08.5

7679,3

18

30.0

012.0

01.5

97.8

6B

erg

er

Pa

ints

Plc

9.5

58.5

7679,3

18

12.5

78.1

01.7

14.9

7C

AP

Plc

25.3

524.5

0102,7

02

43.9

815.1

61.7

68.8

8C

em

en

t C

o. o

f N

ort

he

rn N

ig. P

lc5.4

15.1

2177,2

94

15.4

94.1

61.8

02.3

1D

an

go

te C

em

en

t P

lc112.2

5102.0

1742,3

26

132.5

195.0

08.0

113.1

7F

irst

Alu

min

ium

Nig

eri

a P

lc0.5

00.5

017

0.7

50.5

00.0

00.0

0D

N M

ey

er

Plc

0.7

10.6

57.7

46

3.5

11.0

20.0

00.0

0L

afa

rge

WA

PC

O P

lc42.3

441.2

057,9

86

48.0

536.5

81.0

542.8

6P

ort

lan

d P

ain

ts &

Pro

du

cts

Nig

Plc

3.2

53.2

5163,2

14

5.2

85.1

10.3

614.1

9P

ain

ts &

Co

ati

ng

s M

an

ufa

ctu

rers

1.1

51.1

5214,0

00

3.3

60.5

10.1

82.8

9P

rem

ier

Pa

ints

Plc

10.9

310.9

387

513.4

010.9

30.0

00.0

0

Pa

cka

gin

g/C

on

tain

ers

Avo

n C

row

nca

ps

& C

on

tain

er

3.7

93.7

97,0

00

6.9

15.9

40.1

539.6

0N

ige

ria

n B

ag

s M

an

ufa

ctu

rin

g C

om

pa

ny

2.0

02.1

0723,3

61

3.6

01.4

70.1

99.1

6

To

ols

an

d M

ach

ine

ryN

ige

ria

n R

op

es

Plc

8.2

68.2

610

08.6

98.2

60.0

00.0

0

NA

TU

RA

L R

ES

OU

RC

ES

Ch

em

ica

lsB

OC

Ga

ses

Plc

6.0

06.0

02,0

00

9.2

06.8

00.9

37.3

7

Me

tals

Alu

min

ium

Ex

tru

sio

n I

nd

Plc

10.6

010.6

010

012.3

910.7

00.1

385.7

7

No

n-M

eta

lic

Min

era

l Min

ing

Mu

ltiv

ers

e P

lc0.5

00.5

060,9

57

0.5

00.5

00.0

00.0

0

Pa

per/

Fo

rest

Pro

du

cts

Th

om

as W

ya

tt N

ig.

Plc

1.3

81

.38

50

51

.38

1.3

80

.00

0.0

0

Pro

cess

ing

Sy

setm

sC

ha

ms

Nig

eri

a P

lc0.5

00.5

030

00.5

00.5

00.0

00.0

0

Ele

ctro

nic

an

d E

lect

rica

l P

rod

uct

sC

uti

x P

lc1.4

51.2

01,3

34,9

84

2.5

01.6

20.1

313.1

5N

ige

ria

n W

ire

& C

ab

le P

lc0.5

00.5

04,0

00

2.5

82.5

80.0

00.0

0

Mo

rtg

ag

e C

arr

iers

, Bro

ke

rs a

nd

Se

Ab

be

y B

uil

din

g S

oci

ety

Plc

1.4

41.4

42,0

00

1.5

11.3

30.0

528.8

0U

nio

n H

om

es

Sa

vin

gs

an

d L

oa

ns

0.5

00.5

01,0

00

0.9

90.5

00.0

00.0

0

IND

US

TR

IAL

GO

OD

SP

ack

ag

ing

/Co

nta

ine

rsA

bp

last

Pro

du

cts

Plc

3.9

83.9

86,8

88

3.9

83.9

80.0

00.0

0B

eta

Gla

ss C

o. P

lc12.7

112.7

11,0

00

15.5

812.7

13.9

03.2

6G

reif

Nig

eri

a P

lc13.2

813.2

810

015.0

313.9

70.0

00.0

0N

am

pa

k N

ige

ria

Plc

4.3

04.3

029,1

98

4.3

03.6

01.2

23.5

2P

oly

Pro

du

cts

(Nig

) P

lc1.0

51.0

520

01.8

61.0

50.1

76.1

8S

tud

io P

ress

(N

ig)

Plc

2.9

22.7

884,3

11

2.9

22.9

20.0

741.7

1W

.A.

Gla

ss I

nd

. P

lc0.6

30

.60.6

30.6

30.0

00.0

0

OIL

AN

D G

AS

En

erg

y E

qu

ipm

en

t a

nd

Se

rvic

es

Ja

pa

ul O

il &

Ma

riti

me

Se

rvic

e0.6

40.7

97,2

76,5

20

0.9

7

1

.87

0

.87

0.1

66.0

6

Inte

rgra

ted

Oil

an

d G

as

Se

rvic

es

Oa

nd

o P

lc16.0

615.0

22,3

66,5

52

78.9

727.9

96.9

54.1

7

Pe

tro

leu

m a

nd

Pe

tro

leu

m P

rod

uct

sA

fric

an

Pe

tro

leu

m P

lc20.5

020.5

082,1

91

37.1

00.5

04.9

37.4

0B

eco

Pe

tro

leu

m P

lc0.5

00.5

030

00.7

00.5

00.0

00.0

0C

on

oil

25.4

624.1

971,1

25

32.6

05.7

16.0

2E

tern

a O

il a

nd

Ga

s P

lc2.9

12.9

2327,8

34

5.5

93.8

90.6

76.9

9F

ort

e O

il N

ig P

lc10.9

810.4

4175,1

59

Mo

bil

Oil

Nig

eri

a P

lc132.9

0132.9

031,7

98

163.5

0141.0

013.3

211.1

1M

RS

Oil

Nig

eri

a P

lc36.5

036.5

03,8

74

2,1

00

63.8

63.3

219.2

3To

tal N

ige

ria

Plc

132.0

1132.0

112,3

67

240.0

0195.5

011.9

117.0

7

Ho

spit

ali

tyTa

nta

lise

rs P

lc00.5

00.5

02,0

00

600

SE

RV

ICE

SA

fro

med

ia P

lc0

.50

0.5

01

,50

00

.72

0.5

10

.04

12

.75

Au

tom

ob

ile

/Au

to P

art

Re

tail

ers

Inca

r N

ig.

Plc

1.9

71.9

724

04.3

31.9

7 0

.00

0.0

0R

T B

risc

oe

Plc

1.1

71.3

8581,1

89

3.6

51.3

00.1

68.1

9

Co

uri

er/

Fre

igh

t/D

eli

ve

ryR

ed

Sta

r E

xp

ress

Plc

2.7

92.8

076,5

00

3.6

72.6

50.5

44.9

1E

mp

loy

me

nt S

olu

tio

ns

C &

I L

EA

SIN

G P

LC

0.5

00.5

01,2

00,0

00

1.6

40.9

00.0

811.2

5

Ho

tels

/Lo

dg

ing

Ca

pit

al H

ote

l6.7

86.7

810

040

03.0

00.2

234.0

9Ik

eja

Ho

tel P

lc1.1

91.1

0275,9

07

2.0

71.3

30.6

92.1

2

Me

dia

/En

tert

ain

me

nt

Da

ar

Co

mm

un

ica

tio

ns

Plc

0.5

00.5

0163,4

00

0.5

00.4

80.0

00.0

0

Pri

nti

ng

& P

ub

lish

ing

.A

cad

em

y P

ress

Plc

1.9

01.8

142,9

31

3.6

83.1

70.2

612.1

9L

ea

rn A

fric

a P

lc2.5

32.2

9673,5

84

Lo

ng

ma

n N

ige

ria

Plc

4.2

04.2

04,3

22

8.0

04.6

00.0

00.0

0U

niv

ers

ity

Pre

ss3.9

94.6

0120,2

49

6.8

23.6

00.1

327.6

9

Ro

ad

Tra

nsp

ort

ati

on

Ass

oci

ate

d B

us

Co

mp

an

y P

lc0.5

00.5

01,0

00

0.8

00.5

00.0

00.0

0

Sp

eci

ali

tyIn

terl

ink

ed

Te

chn

olo

gie

s P

lc4.9

04.9

020

5.1

54.9

00.0

00.0

0

Tra

nsp

ort

-Re

late

d S

erv

ice

sA

irli

ne

Se

rvic

es

an

d L

og

isti

cs P

lc1.6

01.6

0700,1

60

2.7

81.5

70.5

14.2

2N

ige

ria

n A

via

tio

n H

an

dli

ng

Co

mp

an

y6.0

06.0

1525,4

22

11.7

56.5

00.8

08.7

5

Op

en

ing

Clo

sin

gQ

ua

nti

tyYe

ar

Year

P.E

Pri

ce

NP

rice

NTra

ded

Hig

hL

ow

E.P

.SR

ati

o

Oil

an

d G

as

an

d P

rod

uct

sP

etr

ole

um

Pro

du

cts

Ca

pit

al O

il P

lc0.5

00.5

0205,0

00

1st

fT

ier

Se

curi

tie

sA

GR

ICU

LT

UR

EC

rop

Pro

du

ctio

nF

TN

Co

coa

Pro

cess

ors

Plc

0.5

00.5

01

65

,00

00.6

40.5

00.0

150.0

0O

ko

mu

Oil

Pa

lm P

lc30.0

030.0

017,7

09

24.5

814.5

37.9

42.7

7P

resc

o P

lc14.7

914.7

578,1

77

8.3

06.4

01.8

04.3

7

Liv

est

ock

/An

ima

l Sp

eci

ali

tie

sL

ive

sto

ck F

ee

ds

Plc

0.9

11.0

11,7

82,8

04

0.6

60.4

80.0

415.0

0

CO

NG

LO

ME

RA

TE

SD

ive

rsif

ied

In

du

stri

es

A.G

. Le

ve

nts

Nig

eri

a P

lc1.0

11.0

139,9

50

2.5

41.4

50.2

85.1

8S

CO

A N

ige

ria

Plc

5.5

25.5

235

58.2

85.5

20.3

515.7

7Tra

nsn

ati

on

al C

orp

ora

tio

n0.9

71.2

115,3

33,1

67

1.8

20.5

00.2

23.6

4C

he

lla

ram

s P

lc6.4

36.4

325

07.6

06.4

30.3

120.7

4U

AC

N P

lc33.3

129.9

11,5

22,2

07

42.5

028.7

07.0

34.1

4

CO

NS

TR

UC

TIO

N/R

EA

L E

ST

AT

EN

on

-Bu

ild

ing

/He

avy

Co

nst

ruct

ion

Ju

liu

s B

erg

er

Nig

Plc

33.0

129.0

8131,4

84

62.2

632.9

6

3.2

610.1

1R

oa

ds

Nig

eri

a P

lc8.6

98.6

930

98.2

83.0

13.6

62.2

6

Re

al E

sta

te D

eve

lop

me

nt

UA

CN

Pro

pe

rty

De

ve

lop

me

nt

11.1

310.5

8534,0

00

20.1

511.5

91.6

67.3

3

Re

al E

sta

te I

nve

stm

en

t T

rust

sS

ky

e S

he

lte

r F

un

ds

100.0

0100.0

01,5

00

100.0

097.0

011.7

58.5

1C

ON

SU

ME

R G

OO

DS

Au

tom

ob

ile

/Au

to P

art

sD

N T

yre

s &

Ru

bb

er

Plc

0.5

00.5

010,0

00

0.5

00.5

00.0

00.0

0

Be

ve

rag

es-

Bre

we

rs/D

isti

lle

rsC

ha

mp

ion

Bre

we

rie

s P

lc3.2

93.2

91

04

,94

84

.63

2.2

30

.00

0.0

0G

uin

ne

ss N

ige

ria

Plc

223.9

9229.0

0722,9

24

255.0

0186.0

012.1

219.9

8In

tern

ati

on

al B

rew

eri

es

Plc

5.8

45.8

42,2

52

7.1

05.2

30.3

516.2

9N

ige

ria

n B

rew

Plc

105.0

094

00943,5

48

100.0

072.5

04.5

022.2

2P

rem

ier

Bre

we

rie

s P

lc0.8

90.8

950,0

00

1.0

10.9

30.0

00.0

0

Be

vera

ge

s-N

on

-Alc

oh

oli

c7

-UP

Bo

ttli

ng

Co

mp

an

y P

lc41.7

041.7

09,4

30

51.4

939.0

03.7

013.9

2

Fo

od

Pro

du

cts

Da

ng

ote

Flo

ur

Mil

ls P

lc6.0

95.8

9402,4

64

19.9

04.3

10.5

416.9

1D

an

go

te S

ug

ar

Re

fin

ery

Plc

3.8

53.5

86,4

99,2

89

16.2

04.0

20.7

114.3

8F

lou

r M

ills

Nig

eri

a P

lc59.0

759.1

1314,1

19

95.0

057.0

04.5

016.8

9H

on

ey

we

ll F

lou

r M

ill P

lc2.1

02.1

0399,2

80

6.6

02.3

10.2

616.9

2N

ati

on

al S

alt

Co

. Nig

Plc

4.2

04.5

1394,8

00

6.7

03.8

00.7

35.7

5U

TC

Nig

eri

a P

lc0.5

00.5

028,0

05

0.8

80.5

00.0

68.8

3

Fo

od

Pro

du

cts-

- D

ive

rsif

ied

Ca

db

ury

Nig

eri

a P

lc15.5

015.3

590,5

80

29.2

010.1

70.2

837.5

7N

est

le N

ige

ria

Plc

425.0

0425.0

053,6

72

470.0

0367.8

315.9

427.9

6

Ho

use

ho

ld D

ura

ble

sB

eta

Gla

ss C

o P

lc11.1

011.1

010

015.5

812.7

13.9

03.2

6N

ige

ria

n E

na

me

lwa

re P

lc36.1

936.1

91,2

00

42.6

636.1

91.6

122.4

8V

ita

foa

m N

ig. P

lc3.2

83.2

9245,0

00

6.7

54.7

80.7

07.3

4V

on

o P

rod

uct

s P

lc2.8

82.8

880

03.6

72.6

60.0

00.0

0

Pe

rso

na

l/H

ou

seh

old

Pro

du

cts

PZ

Cu

sso

ns

Nig

eri

a P

lc24.2

024.5

0134,4

83

43.5

027.0

01.2

920.9

3U

nil

eve

r N

ige

ria

Plc

29.0

029.3

0353,1

11

31.2

522.5

61.3

220.4

6

FIN

AN

CIA

L S

ER

VIC

ES

Ba

nk

ing

Acc

ess

Ba

nk

Plc

6.8

96.0

328,7

55,9

39

11.1

04.2

60.8

05.8

3A

frib

an

k N

ige

ria

Plc

0.6

40.6

4646,6

08

3.3

90.6

40.0

00.0

0B

an

k P

HB

Plc

0.5

70.5

5146,5

38,5

02

2.3

00.5

30.0

00.0

0D

iam

on

d B

an

k N

ige

ria

Plc

2.6

32.4

37,7

53,0

03

9.2

72.0

50.0

00.0

0E

cob

an

k T

RA

NS

NA

TIO

NA

L I

NC

OR

PO

RA

TIO

N11.2

510

.82

2,2

54,0

80

4.3

01.6

50.2

825.9

1F

ide

lity

Ba

nk

Plc

1.2

71.2

66,5

50,3

67

3.2

01.2

00.2

26.6

8F

inB

an

k P

lc0.5

00.5

01,0

00

9.5

00.0

00.0

0

0

.00

Fir

st B

an

k o

f N

ig.

Plc

11.5

010.8

021,4

23,1

90

16.1

27.9

51.3

46.9

6F

irst

Cit

y M

on

um

en

t B

an

k P

lc4.6

03.3

61,1

08,9

42

8.3

03.6

00.6

96.2

0G

ua

ran

ty T

rust

Ba

nk

Plc

15.1

915.0

117,1

73,5

32

20.5

011.6

41.6

1

8.7

4N

PF

Mic

ro-F

ina

nce

Ba

nk

Plc

1.0

71.0

756,0

00

1.7

80.0

00.0

00.0

0In

terc

on

tin

en

tal B

an

k P

lc0.7

00.7

073,2

00

1.7

80.8

70.1

85.4

4O

cea

nic

Ba

nk

In

tern

ati

on

al P

lc1.1

51.1

591,0

00

13.5

00.0

00.0

00.0

0S

ky

e B

an

k P

lc2.9

22.8

113,3

40,9

06

10.1

73.9

00.8

55.0

7S

pri

ng

Ba

nk

Plc

0.8

8 0

.88

1,0

06,0

32

2.1

80.7

30.5

05.4

4S

tan

bic

IB

TC

Ba

nk

Plc

6.1

96.0

52,8

21,2

06

11.3

86.3

00.5

414.8

1S

terl

ing

Ba

nk

Plc

1.1

41.1

05,9

39,4

70

2.9

10.9

50.2

24.6

8U

BA

Plc

4.0

03.6

87,3

51,3

17

11.7

02.1

70.1

319.2

3U

nio

n B

an

k N

ig.

Plc

3.5

53.7

5982,9

27

5.3

81.9

67.5

90.2

8U

nit

y B

an

k P

lc0.5

40.5

05,6

10,0

89

1.9

20.5

00.1

14.8

2W

em

a B

an

k P

lc0.5

00.5

028,9

77

1.7

50.5

21.3

40.4

3Z

en

ith

Ba

nk

Plc

13.4

513.5

050,3

87,9

19

16.7

011.4

51.5

77.8

3

Insu

ran

ce C

arr

iers

, B

rok

ers

an

d S

ect

or

AII

CO

In

sura

nce

Plc

0.5

00.5

016,5

00

1.0

60.5

00.0

95.5

6C

on

tin

en

tal

Re

insu

ran

ce P

lc0.7

50.7

15

85

,00

01.2

00.8

50.1

010.2

0A

fric

an

All

ian

ce I

nsu

ran

ce0.5

00.5

05,0

00

0.5

00.5

00.0

00.0

0C

orn

ers

ton

e I

nsu

ran

ce C

om

p0.5

00.5

01

51

,00

00.5

00.5

00.0

00.0

0C

on

soli

da

ted

Ha

llm

ark

In

sura

nce

0.5

00.5

020,0

00

0.5

00.5

00.0

68.3

3C

ust

od

ian

an

d A

llie

d I

nsu

ran

ce P

lc1.7

01.6

11,1

04,2

50

3.5

12.0

00.4

34.8

8E

qu

ity

Ass

ura

nce

Plc

0.5

00.5

03,8

00

0.5

00.5

00.0

00.0

0G

old

lin

k I

nsu

ran

ce P

lc0.6

10.6

41,0

90,0

00

0.6

90.5

00.0

00.0

0G

rea

t (N

ig)

Insu

ran

ce P

lc0.5

00.5

010,4

00

0.5

00.5

00.0

00.0

0G

ua

ran

ty T

ru

st A

ssu

ran

ce P

lc1.5

61.5

56,4

31,2

72

0.9

50.9

50.0

817.2

5G

uin

ea

In

sura

nce

Plc

0.5

00.5

03,5

00

0.5

00.5

00.0

00.0

0In

terc

on

tin

en

tal W

ap

ic I

nsu

ran

ce P

lc0.5

20.5

82,9

82,9

00

0.5

00.5

00.0

00.0

0In

tern

ati

on

al E

ne

rgy

In

sura

nce

Plc

0.5

00.5

096,1

66

0.5

00.5

00.0

00.0

0In

ve

stm

en

t a

nd

All

ied

Ass

ura

nce

0.5

00.5

01,6

70,8

90

0.5

00.5

00.0

225.0

0L

AS

AC

O A

ssu

ran

ce P

lc0.5

00.5

020

00.5

00.5

00.0

68.3

3L

aw

Un

ion

& R

ock

In

sura

nce

Plc

0.5

00.5

2143,3

51

0.5

00.5

00.1

05.0

0L

ink

ag

e A

ssu

ran

ce P

lc0.5

00.5

020

00.5

00.5

00.0

00.0

0M

utu

al B

en

efi

ts A

ssu

ran

ce P

lc0.5

00.5

04,7

00

0.5

00.5

00.1

05.0

0N

EM

In

sura

nce

Co

. (N

ig)

Ltd

0.5

00.5

0225,0

00

0.5

00.5

00.3

61.3

9N

ige

r In

sura

nce

Co

. P

lc0.5

00.5

0100,0

00

0.9

00.5

00.0

150.0

0O

AS

IS I

nsu

ran

ce P

lc.

0.5

00.5

01,0

00

0.5

00.5

00.0

150.0

0P

rest

ige

Ass

ura

nce

Co

. Plc

0.5

00.5

23,5

00

2.5

01.9

00.1

46.4

3R

eg

en

cy A

llia

nce

In

sura

nce

0.5

00.5

013,7

50,0

00

0.5

00.5

00.0

316.6

7S

ov

ere

ign

Tru

st I

nsu

ran

ce0.5

00.5

01,9

00

0.5

00.5

00.0

77.1

4S

taco

In

sura

nce

Plc

0.5

00.5

010,0

00

0.5

00.5

00.0

00.0

0S

tan

da

rd A

llia

nce

In

sura

nce

0.5

00.5

013

00.5

00.5

00.0

00.0

0U

NIC

In

sura

nce

Plc

0.5

00.5

04,2

66

0.5

00.5

00.0

00.0

0U

niv

ers

al

Insu

ran

ce P

lc0.5

00.5

0115,5

00

0.5

00.5

00.0

00.0

0

Mo

rtg

ag

e C

arr

ier,

Bro

ke

r a

nd

Se

cto

rA

so S

av

ing

s a

nd

Lo

an

s P

lc0.5

00.5

0100,0

00

0.5

00.5

00.0

00.0

0R

eso

rt S

av

ing

s &

Lo

an

s P

lc0.5

00.5

0300,0

00

0.5

00.5

00.0

00.0

0

Oth

er

Fin

an

cia

l In

stit

uti

on

sC

rusa

de

r (N

ige

ria

) P

lc

0.5

00.5

027,5

00

0.6

10.5

00.0

00.0

0D

ea

p C

ap

ita

l Ma

na

ge

me

nt

& T

rust

Plc

2.0

22.0

25,8

00

2.0

22.0

20.0

00.0

0R

oy

al E

xch

an

ge

Ass

ura

nce

0.5

00.5

04

,37

5,8

18

0.6

60.5

00.0

316.6

7

HE

AL

TH

CA

RE

Me

dic

al S

up

pli

es

Mo

riso

n I

nd

ust

rie

s P

lc7.7

77.7

725

010.5

49.5

20.0

00.0

0H

ea

lth

care

Pro

vid

ers

Op

en

ing

Clo

sin

gP

rice

Pri

ceQ

ua

nti

tyYea

rYear

P.E

.

Company

(N)

(N

)Tra

ded

Hig

hL

ow

E.P

.S.

R

ati

o

Ca

pit

al M

ark

et

Sto

ck

Ma

rket

Rep

ort

as

at

Fri

day,

Ju

ne 8

, 2012

28 — Vanguard, MONDAY, JUNE 11, 2012

BRIEFS

Housing finance: Firm to raiseN2.5bn via private placement

Architects in LagosState have called onthe state government

to come up with clear andfocused policies that wouldaddress all knotty areas onthe path to mass housingprovision.

They averred that the issueof mass housing will continueto be a mirage if stategovernment fails to bringtogether all stakeholdersdirectly and indirectlyinvolved in housing.According to them, the rapidpopulation growth in the statewithout correspondingaccommodation to support thegrowth has made it pertinentand imperative for urban masshousing to be pursuedvigorously via establishedclear policies and well-focused actions.

This formed part of thecommuniqué issued after theLagos Architect Forum 2012(LAF 2012), which had about1000 participants drawn fromdifferent sectors of LagosState and different parts of thecountry in attendance.Participants includeprofessionals in publicservice, private practice,academia, allied professionsand building /constructionmaterials manufacturers andsuppliers. The theme of theconference was ‘LAGOS 3.0,Urban Mass Housing andHomes in Lagos’.

Federal Capital Territory(FCT) Administrationis set to sanction

allocations of plots of land bythe former FCT Minister,Nasir el-Rufai towards theend of his administration inMay 2007 which the Senatestopped.

FCT minister, Senator BalaMohammed , said thatthough there are moral issuesbegging for answersregarding such plotallocations, “certainly theallocations still stand.” Hesaid about 3,500 plots wereallocated within one weekwhich resulted in the Senateraising eyebrows to ask hispredecessors not to releasethe letters of allocation.

He said that though someof the cases are in court butthat he had appealed toPresident Goodluck Jonathanto look at the issuesympathetically.

Architectstask Lagoson masshousing

FCT tosanction El-Rufai’s plotallocationssoon

Homes & Housing Finance

REDAN Capital Ltd(RC), an investmentarm of the Real Estate

Developers Association ofNigeria (REDAN), hasconcluded plans to raise itscapital base from N50 millionto N2.5 billion throughprivate placement which isexpected to open soon.

RC is a finance and capitalsolutions companyincorporated by REDAN overtwo years ago to enable it dealin businesses which it cannotlegally deal in.

Chairman of the company,Dr. Chris Ekong, said that theplacement will enable thecompany expand its financialservices and also floatsubsidiaries that will provideessential services such asmortgage banking,construction leasing and bulksourcing of building materialsto property/estate andinfrastructure developers.

Ekong, who is a formercommissioner in Akwa-IbomState, disclosed this at thecompany’s directors andshareholders’ meeting heldrecently, in Abuja, addingthat the placement will targetREDAN members and otherinterested private investors

“Our mission is to be instrategic partnership with keystakeholders for harnessingcapital resources within andoutside Nigeria towardsproviding quality andaffordable housing through

consistent and efficientdelivery of superior value-added services specificallydesigned to meet the needsof estate and propertydevelopers in Nigeria and inthe sub-regional Africa.

“We deliver superior value-added services by bridgingthe gap that exists inaccessing finance and bytapping into the hugeopportunities and prospectsthat exist in the propertymarket/mortgage finance inNigeria. The large volume of

dealings before us hasnecessitated us to move upfrom an initial N50 millioncapital base to N2.5 billion.And with this move, RC willnow be able to bring morebusinesses under its portfolio.

“The property market/mortgage finance sub-sectoris the future of the economy,which is capable ofstimulating other sectors ofthe economy if all thechallenges are properlyaddressed considering thepopulation, demand and the

economic capacity of thepeople,” he stated.

General Manager of RC,Mr Olawale Okunade, in hisremarks, said the company isdiscussing with internationalfinancial institutions andstakeholders, includingShelter Afrique, for possibleinvestment in RC whichaccording to him will formpart of the basis for a meetingwith Shelter Afrique in Kigali,Rwanda after their 31st AGMthis month.

‘Soil engineering key to curbing buildingcollapse’

Proper understandingof charasteristics ofsoil types on which

buildings are constructed byengineers and otherprofessionals involved inconstruction will go a longway in drastically reducingthe incidence of buildingcollapse in the country.

President, NigerianInstitution of StructuralEngineers (NIStructE), Mr.Busola Awojobi, stated this inLagos, at a technical trainingcourse on the application ofsoil engineering to the designof foundations with particularreference to buildingfoundations, sheet piles inshoreline protection and

jetties, which was organisedby NIStructE.

He said engineeringstructures usually collapsebecause of inadequateunderstanding of the soil, anddeclared that such incidencewould be reduced drasticallyif design and constructionengineers understood what todo in the design offoundations.

Awojobi said that theconcern of NIStructE on theloss of lives and propertyoccasioned by the recurrentincidences of collapse ofbuilding and otherengineering structuresprompted the organisation ofcourses on engineering

design fundamentals,beginning with the soil thatsupport entire load ofstructures.

Topics treated at the sessionincluded essential subsoilengineering investigationsfor buildings, sheet piles andjetties; interpretation andpractical use of subsoilengineering reports; andpractical case of ageotechnical/structural surveyand restoration of failedconcrete sheet pile and jetty.

According to the coursecoordinator, Mr. OreOluwaFadayomi, the institutionhopes that the course wouldgreatly assist practicingengineers in the public andprivate sectors to be moreefficient in service delivery.

Elegunshi Estate Lekki

BRIEF

Vanguard, MONDAY, JUNE 11, 2012 — 29

Homes & Housing Finance

BRIEFKwara partners dutch firm onN73bn housing development

Kwara State governmenthas signed a Memorandum ofUnderstanding (MoU) withStylotec Concrete Industriesof The Netherlands for theconstruction of 10,000affordable housing units overthe next four years, worthabout N73 billion.

At the signing ceremonybetween the stategovernment and the dutchfirm in Ilorin, GovernorAbdulfatah Ahmed said thetechnology to be deployed inthe development has thecapacity to deliver 15 housingunits per day.

The governor disclosed thatthe project will cost $450m(N70.65 billion) to deliver thehouses while another $15m(N2.35 billion) will be used forthe development of necessaryinfrastructure, bringing thetotal capital outlay to aboutN73 billion.

Chief Press Secretary to theGovernor, Mr. AbdulwahabOba, in a statement, quotedthe governor as saying theprojection was achievable dueto the new technology thatwould be employed.

According to him, thehousing scheme would helpin the actualisation of hisadministration’s SharedProsperity programme as

clinics would now be built ingood time to facilitate 500metres access to good healthcare by the residents. “Thebeauty of the scheme is thatthe core investors have awindow that will ensure thatKwara residents have accessto mortgage loans to buy the

houses,” the governor stated.In his remarks at the

occasion, President ofStylotec Concrete Industries,Mr. George Lamar, said theprojection of 10,000 housingunits in four years wasachievable because of themodern technology that

would be employed. He saidthe environment in KwaraState is conducive for thehousing initiative because thestate government had put inplace business-friendlypolicies.

Lagos to deliver 50 houses monthly

Lagos State governmenthas declared that itsvarious housing

schemes being developedacross that state is expectedto deliver 50 new housingunits every month.

Governor BabatundeFashola who stated thisrecently in Lagos, at thecommissioning of the firsttraffic radio station inNigeria, lamented thatmortgages have not beensuccessful in the country dueto reasons associated withhigh cost of fund, land andbuilding materials. “Everymonth 50 new home ownerswill emerge through thevarious housing schemes ofgovernment,” he said.

Fashola also restatedgovernment’s commitment tothe State Tenancy Law, whichmakes it unlawful for alandlord or his agent todemand or receive rent inexcess of six months from asitting tenant.

Under the law, it is illegalfor any landlord to receivemore than a year rent from anew tenant otherwise he willpay a fine of N100,000 or besentenced to three yearsimprisonment. It is alsounlawful for a tenant to offerto pay more than a year renteven though it gives room for

the two parties to sign atenancy agreement.

The governor said the lawwas put in place to protectboth the landlord and tenantstressing that where a tenantgoes against the dictates ofthe law by clandestinelypaying above what the law

stipulates, he will not get anyrelief from the court.

Also speaking at the event,the State Commissioner forInformation and Strategy, MrLateef Ibirogba, said taxpayers money will be used tofacilitate single digit intereston mortgage to provide

affordable homes to theordinary man on the street.He further disclosed that theongoing construction of theLagos/Badagry expresswaywill be speeded up as soonas government secures theright of way and the requiredfund.

Developer urges FMBN’s N100bnrecapitalisation

A real estate developerhas called on thefederal government

to fast-track the proposedrecapitalisation of FederalMortgage Bank of Nigeria(FMBN) to the tune of N100billion in a bid to effectivelytackle the housing crisis in thecountry.

Chief Austin Oguejifor,Chief Executive, First RotechGroup, made the call duringthe flag off of the constructionof 850 housing units at theLuxury Place Estate in Abuja,adding that without a vibrantand robust mortgage system

to drive the sector housingdelivery will remain a mirage.

“Considering the nation’scurrent deficit of over 16million houses, the FMBN’scurrent N2.5 billion capitalbase was insufficient andcannot make any reasonableimpact in tackling thehousing challengesconfronting Nigeria.

“FMBN managementshould ensure thecommencement and processof integration of the informalsector into its NationalHousing Fund (NHF) usingcooperative societies’structures as is in practice in

other parts of the world. It isexpected that under thisscheme, Nigerians in theinformal sector like the akaraseller, bricklayers commercialdrivers as well as the roadside motor mechanic etc, willhave the opportunity to owntheir residential houses.

“It is worrisome that acountry like Nigeria cannothouse its citizens adequately.There is need for concertedcollaboration between thegovernment, private sectorand the beneficiaries toreverse the ugly trend in thesector,” he stated.

House built with burnt bricks

Nigeria poisedfor fastestconstructiongrowth

A report by GlobalC o n s t r u c t i o n

Perspectives and OxfordEconomics has forecasted thatin the next ten years,construction growth inNigeria will be the fastest ofall markets.

The report says Nigeriaremains the market where thefastest growth will happen asit will be the global hotspotfrom now to 2020 as thenation’s construction growthhave risen higher thanIndia’s, which reflectsincreased wealth.

Head of ConferenceProgrammes, The EconomistGroup, Dougal Thomson, inhis introductory remarks atthe at “The EconomistConference on Future Cities”,predicted that Africanpopulation is going tosurpass that of China by2050, citing InternationalMonetary Fund (IMF)projection, which says thatAfrican GDP growth at themoment is 5.4 per cent perannum.

Thomson, who spoke on‘The World in 2020:Understanding the Drivers ofChange’ however, pointedout that Africans are stillstruggling to get going,noting that so much money isneeded to transform cities inthe continent.

US mortgagerates fall torecord low

Average US rates on 30-year and 15-year fixed

mortgages fell to fresh recordlows for the sixth straightweek. Cheap mortgagescontinue to help boostprospects for home sales thisyear.

Mortgage buyer FreddieMac says the average rate onthe 30-year loan dropped to3.67 percent. That’s downsharply from 3.75 percent lastweek and the lowest sincelong-term mortgages beganin the 1950s. The 15-yearmortgage, a popularrefinancing option, declinedto 2.94 percent. That’s downfrom 2.97 percent last week.

Rates on the 30-year loanhave been below 4 percentsince early December. Thelow rates are a key reason thehousing industry is showingmodest signs of a recoverythis year. A drop in ratescould also provide some helpto the economy if morepeople refinance. Whenpeople refinance at lowerrates, they pay less intereston their loans and have moremoney to spend.

30 — Vanguard, MONDAY, JUNE 11, 2012

Insurance

BRIEF

By FAVOUR NNABUGWU

Seven local insurancecompanies are to pay

their share of 30 per centclaims in the $4.5millioninsurance premium paid bymanagement of Dana Airlinefor insurance of the aircraft.

The ill fated plane thatcrashed on Sunday, June 3,2012, Vanguardinvestigations revealed thataircraft was insured and hada combined single limit of$350million out of which 30per cent was retained in thelocal market led by PrestigeAssurance Company and 70per cent insured overseasthrough Aon Brokers toinsurers in the Londonmarket.

The insurance account of theairline which was co-insuredwere shared as follow:Prestige Assurance leadingwith 8%; Leadway Assurancewith 7%; NEM Insurance, 5%;Sterling Assurance, 3%;Continental Reinsurance 3%;Aiico 2% and StandardAlliance 2%.

Llyods of London, the groupinsurer of Dana Airlines, saidthat it would pay adequatecompensations to the familiesof the victims of last Sunday’sair crash at Iju-Ishaga, aLagos suburb.

Mr Yomi Oshinkoya, theLloyds Correspondent,disclosed this on Wednesdayat a joint news conferenceaddressed by officials of theLagos State government andDana Airline.

The news conference tookplace at the Lagos StateUniversity Teaching Hospital

Prestige, Leadway, five others to pay30% share of Dana's plane crash claims

(LASUTH), Ikeja, with MrAde Ipaye, the Lagos StateAttorney-General andCommissioner for Justice, inattendance.

Oshinkoya said thatcompensations would be paidto the victims families,according to aviationstandards, adding thatpeople should not be afraidthat the accident occurred in

Nigeria.He assured all the families

of the victims that the airlinewas well insured and wouldlive up to its liability biddingin this regard.

“The international law andstandards stipulate that thesum of 30,000 dollars (N4.6million) must be paid to eachof the victims’ family withinthe first 30 days of the

accident, as initial payment.“A sealing of 100,000 dollars

(N15 million) should be paidto the victims family after theymust have completed all therequirements expected ofthem by the law,” Oshinkoyasaid.

He said that thecompensation would be forthe passenger families andthose on the ground.

He explained that theinsurer had commissioned aNigerian surveyor to go to thesite and evaluate the valuesof the buildings andproperties damaged.

“The surveyor is to make acomprehensive report to theinsurer through the airline forthem to work out thecompensations to be paid tothem.

Oshinkoya, however, urgedfamily members of the victimsto come up with evidence toproof their claims that linkthem with the deceased.

“We will be responsible, aswe do not want families of thevictims to suffer and theirclaims would be processed asfast as possible,” he said.

Oshinkoya said that whenpayments would be made, theairline’s insurer would writeto individual victim’s familiesto inform them.

Mr Francis Ogboro,representing Dana Airline,denied rumours that theaircraft was faulty beforetaking off from Abuja. “Danatakes the safety of its aircraftand that of its passengers veryseriously,” he said.

As companies graduallytransit to the

International FinancialReporting Standard, IFRS, asmandated by the regulatoryauthorities, insurancecompanies have beencharged to maintain highlevel of professionalism in thedischarge of their duties.

This is hinged on the factthat the IFRS will compel themto reflect all infractions as wellas fines incurred in the courseof each financial year in theirannual reports.

Assistant Director(Inspectorate), Head AML/CFT Unit of the NationalInsurance Commission,NAICOM, Mr. Sam Onyekawho gave this charge said thatunnecessary infractions andfines could draw the ire ofshareholders which couldlikely lead to a vote of noconfidence on themanagement of any suchcompany. Onyeka said “WithIFRS, every fine must reflectin the annual report ofcompanies. And where finesbecome a bit too high,

IFRS: ‘Unnecessary fines could prompt voteof no confidence on managements

shareholders will begin to askquestions and when acompany cannot givesatisfactory answers to suchquestions, then trust on suchcompanies will graduallydiminish.”

Meanwhile companies thatare in the habit of releasingtheir results late may lose outin the scheme of things as theIFRS gets on stream. This isbecause in the era of IFRS,strategic investors may readilytake investment decisionsbased on financial results thatare on hand rather than waitfor ones that are not available.

NAICOM also warned thatonce a financial statement isdelayed, it has lost itsrelevance for people that wantto make economic decisionsfrom such company. Mr.Cyprian Amadi of theSupervision and DirectorateDepartment of NAICOMtherefore tasked underwritersthat are in the habit ofsubmitting results late to havea rethink if they don’t want tobe left behind in the future.

Accordingly, Amadiemphasised early submissionof financial results byinsurance companies in line

with relevant provisions of thelaw to the commission earlyenough.

While stressing that the aimfor preparing financialstatement is defeated when itis not made available to theusers when needed, Amadinoted that the objective offinancial reports includeprovision of usefulinformation to a wide rangeof users in making economicdecisions as the financialreports show the results of thestewardship of management,or the accountability ofmanagement for the resourcesentrusted to it. He listed theusers of financial statementsto include investors, lenders,employees, customers, taxauthorities, regulators,creditors and suppliers, aswell as the general public.

Amadi said, “The closer toyear-end that financialstatements are issued, themore relevant and reliable theinformation in them is to beused for making decisions.”

Section 26 of the InsuranceAct, 2003 prescribes that aninsurer must submit auditedfinancial statements andannual returns.

By ROSEMARYONUOHA

Expert urgesinsurers toeducate publicon compulsoryinsuranceproducts

Mr. Yemi Soladoye, aninsurance expert has

urged insurance operators toengage the public oninsurance education on thefive compulsory insuranceproducts that were madecompulsory by the federalgovernment in 2010.

Soladoye said that if theinsurance companies areready to engage in insuranceeducation, people will buythese products and thecompulsory insurance mayend up forming about 50 or55 per cent of their annualpremium income.

He said “In many othercountries like in America orUK, it is not that people aretaking insurance more thanwe do in Nigeria, but there isthe enforcement of thecompulsory insurance there.”

General insurersbounce back

General insurers haverecorded much stronger

net profits for the Marchquarter compared to thecorresponding quarter lastyear.

They reported $1 billion totalnet profit for the March 2012quarter, up from $490 million,Australian PrudentialRegulation Authority (APRA)figures released on Fridayshow.

Last year’s result showedthe impact of the naturaldisaster claims from Januaryand February. This yearinsurers wrote $8.5 billion ofgross written premium,compared to $7.9 billion in thecorresponding quarter lastyear. Gross incurred claimswere $6.6 billion, comparedwith $16.5 billion. The dropin claims was spread acrossmost insurance sectors. Publicand product liability claims fellfrom $310 million to $282million, while professionalindemnity claims fell from$246 million to $201 million.Employers’ liability claimsdropped from $312 million to$214 million. CTP motorvehicle claims fell from $710million to $560 million.

Brokers also benefitted, withcommissions growing from$750 million to $796 million.Insurers continue to winddown their equity holdings.At March 31 last year, theyheld $2.1 billion in equities,which fell to $1.65 billion thisyear.

Group President, Skipper Energy, Mr. Jitender Sachdeva (left), Minister of Power, Prof. Bart

Nnaji and Indian High Commissioner to Nigeria, Mr. Mahesh Sachdev, at the inaugurationof Power Transformer Repairing Plant by GTE Engineering Nigeria Limited, at Ikorodu,Lagos…on Friday

Vanguard, MONDAY, JUNE 11, 2012 — 31

CMYK

BRIEFS

Insurance

As part of the drive tomeet the growingneeds of her teeming

customers, Zenith Insurancerecently entered into anexclusive partnership with ihiBupa Denmark, a BUPA(British United ProvidentAssociation) company todevelop and market newtravel insurance products inNigeria.

Tagged ZTIP (Zenith TravelInsurance Plan), this uniqueproduct to be underwritten byihi BUPA and administered inNigeria solely by ZenithInsurance, will meet not justthe travel insurance needs ofclients outside Nigeria butalso provide personalaccident cover while they arestill in the country.

ZTIP provides bothSchengen and WorldwidePlans. The Schengen TravelInsurance Plan is a medicaltravel insurance that hasbeen designed to fully meetthe insurance requirements

STI proposes 4kdividend

Sovereign TrustInsurance Plc has set

June 21, 2012, as the datefor its 17th annual generalmeeting having beengranted approvals for its2011 annual reports andaccounts by the NationalInsurance Commission,NAICOM, and the NigerianStock Exchange, NSE,respectively.

The Board of Directors ofthe company is proposing adividend of 4k per share forratification by shareholdersat the annual generalmeeting. It will be recalledthat the company paid adividend of 3k in 2010.

In a statement toVanguard, Head ofCorporate Communications/Brand Management of thecompany Mr. SegunBankole said that theperformance of the companyin 2011 was largely due tothe patronage and supportthe company got from theinsuring public and the factthat the management iscommitted to deliveringvalue for its teemingshareholders across thecountry.

Bankole said the companycalled for continuedpatronage from its customersin the years ahead whilegiving assurance for cutting-edge professional serviceseach time they transactbusiness with theunderwriting firm. “TheBoard and Management ofSovereign Trust InsurancePlc wish to thank every of ourcustomers who have keptfaith with us and supportedour business through theyears and most especially in2011,” he said.

Shareholders ofContinental Reto get 8kdividend

Co n t i n e n t a lReinsurance Plc is

proposing a dividend ofeight kobo to shareholdersfor the financial year endedDecember 31, 2011.

According to the auditedresult of the company for theyear in review sent to theNigerian Stock Exchange,NSE, the register ofmembers of the companywill open and close from 9th– 13th of July 2012.

The annual generalmeeting has been slated for18th July, 2012 whilepayment of dividend is onthe 19th of July, 2012.

By FAVOUR NNABUGWU

LASACO Assurance hasaffirmed its commitment

to oil and gas industrybusiness in the country withadherence to ethicalstandards andprofessionalism.

The Executive Director ofLASACO Assurance, Mr.Babajide Wright said that thecompany as a major player inthe oil and gas insurancebusiness has continuously

LASACO reiterates commitmentto oil & gas insurance

reinvented the rules toleverage on its potentials.Wright who was speaking inchat on the company’s nichein oil and gas insurance saidit is a terrain LASACO pridesitself as a formidable player.

One major area LASACOdoes this is through promptclaims settlement. Accordingto him, LASACO pays claimspromptly it is a policy themanagement pay attention tomost especially on oil and gasbusiness. International oilcompanies pay premium as atwhen due, when claims

materialise we should do sotoo.

Mr Wright said the depth ofthe company ’sprofessionalism in handingbusiness most especially inthe oil and gas sector hasmade the firm sand out fromit pears, “LASACO’sinvolvement extends beyondgrowth of the company, it alsoencompasses ways andmeans of developing themarket. It contains technicalcapacities to develop theindustry. To this end,LASACO’s has beenarrowheads for capacitybuilding and professional

enrichment platforms.Speaking on how the firm

intends to maintain it nichein the industry Mr. Wrightsaid LASACO organisestrainings and seminars bothlocally and internationally formiddle management and topmanagement staff,Attachment programmes inoverseas for staff withinternational affiliate to getmore knowledge of how thebusiness is practicedinternationally the firm alsoencourage in-house researchinto the portfolio of oil and gasbusiness, also knowledgeupdate on internationaljournals in oil and gas to knowcurrent trends.

Bearing his mind on whatthe future holds for oil and gasinsurance in Nigeria Mr.Wright said the future is verypromising with the advent ofoil and gas contentdevelopment Act 2010, lot ofcompanies have been givingopportunity to makeappreciable income.

However, he gave an advicefor other insurance firms. Hesaid “Insurance companiesshould be conscious, thebusiness is lucrative, it couldbe very treacherous if theright arrangements are notmade, it affects the company”.

He added that “anothertechnical arrangement is thatif loss comes and insurancecompanies are not able tomeet it, it can erodeconfidence replied inNigerian insurance firms byinternational oil companieswho ordinarily have beenaverse in the business”.

Zenith Insurance partners ihi-BUPA on new travelinsurance products

for visa issuance (30,000Euros) by the Schengenembassies in Nigeria. TheMedical benefits under thisplan are subject to a maximumof 30, 000 Euros.

The Worldwide TravelInsurance Plan unlike theSchengen plan offersunlimited medical benefits tothe client travelling to allcountries worldwideincluding the Schengencountries. It also offers freetravel insurance to childrenless than two years travellingwith an adult.

Both plans are accompaniedby a free Personal AccidentInsurance policy - whichprovides compensation forinsured persons in respect ofinjury, death or disability(permanent and temporary)resulting from accident atanytime, anywhere in theworld including Nigeria.

Also, in line with the knackfor innovation for which theZenith brand is known,

Zenith Insurance is offeringintending travellers theopportunity to purchase theproduct (ZTIP) convenientlyvia the company’s onlineportal therefore becoming thefirst indigenous company tooffer travel insurance on anonline, real time platform.The product can also beaccessed directly from anyZenith Insurance officenationwide.

Zenith Insurance has alsotaken measures to tie thesecurity of the product not toits physical appearance but toreal-time electronic features,which are known and agreedwith the embassies. Thismeans that although a ZTIPpolicy is not on specialsecurity paper, or haveholograms or other physicalmarkings that oftennecessitate a need tophysically collect or deliverthe policy, there are knownelectronic validity andsecurity elements which the

embassies use to verify thepolicies. This has given realfreedom to clients to be ableto purchase a genuine travelpolicy anytime, anywhere.Zenith Insurance is one ofNigeria’s leading financialinstitutions known forconsistent superiorperformance and driven bythe vision to be the bestprovider of insurance servicesto its clients. In the financialyear ending December 31,2012, the company grew itsgross premium from N4.54billion to N5.64, representinga 2.4 per cent increase whileshareholder funds rose by 7.7per cent from N8.73 billion.Total assets for the periodunder review also grew by 6per cent up from N11.90billion to N12.62 billion.Zenith Insurance isregistered and licensed underthe provisions of theInsurance Act 2003 to transactall classes of insurance.

From Left: President NEA, Mr. Tope Esan; General Manager Federal Palace Hotel & Casino,Mr. David Kliegl and Marketing Manager Federal Palace Hotel & Casino, Mr. Uche Ogbu atthe 7 Annual NEA Nomination Night held at Federal Palace Hotel & Casino.

32 —Vanguard, MONDAY, JUNE 11, 2012

Vanguard, MONDAY, JUNE 11, 2012 — 33

34 — Vanguard, MONDAY, JUNE 11, 2012

,

Tax Platform

,

National Tax policyguidelines and rules (6)

Strict implementation oftax laws includingovert and explicit sup-

port through referrals of ma-jor cases to tax authorities(Federal and State) on a con-tinuous basis and integrationof tax “psyche” in the day today business of government

Ensuring proper assess-ment, collection and promptremittance of taxes to desig-nated government accounts.

Ensuring fiscal complianceof every person that they dealwith., Ensuring that everydatabase maintained in gov-ernment has a compulsoryfield for the inclusion of theunique taxpayer identificationnumber for every company,enterprise, individual andother registered organisation,Use of e-payment systems inall transactions inclusive ofdirect remittance to the ac-counts of the tax authorities..

Use of technology and relat-ed systems in the way busi-ness is done - e.g. electroniccash registers, automated landregistries, etc and linkage ofdatabases and such systemsmaintained in government tothe Federal and State tax au-thority databases Ensuringtax is a major consideration inthe evaluation process of in-dividuals and organisationssuch that the lack of paymentof taxes is seen as an affronton government and a crime.Ensuring that’ all Tax Clear-ance Certificates and other taxdocuments used in govern-ment transactions are referredback to’ the relevant revenueauthority for authenticationThe State Ministry of Finance(SMF) Shall have primaryresponsibility for tax policymatters at the State level, in-cluding initiating proposalsfor amendments to tax laws bythe National Assembly (in thecase of Federal tax laws) andthe State House of Assemblyin the case of State and LG taxlaws).

The SMF shall coordinate allrequests from other State Min-istries and Agencies relatingto fiscal issues as would en-sure harmonisation of the fis-cal policy issues of the Stateand Federal government. Inthis regard, no other State orLocal Government Ministry orState or LG Government agen-cy shall have the right to com-mit the State or Federal gov-ernment through the signingof agreements, writing of let-ters, or other communicationregarding fiscal policy issueswithout the authority or con-sent of the Federal and State

Ministry of FinanceThe SMF and the relevant

Government agency, whichwill administer the tax shallseek recommendations fromthe relevant stakeholders toensure that enactments areregularly reviewed and sub-stantially meet the principlesof good taxation and the ob-jectives of Nigeria’s tax sys-tem as stated in this document.

The SMF shall partner withthe Federal Ministry of Fi-nance and other State andLocal Government agencies toensure the development ofNigeria’s tax system and a taxculture amongst Nigerian cit-izens.

The SMF shall in this role,work closely with the StateBoard of Internal Revenue aswell as the Federal InlandRevenue Service and the Ni-geria Customs Service (in thecase of import and excise du-ties).

Support the State InternalRevenue Service, Federal In-land Revenue Service, theJoint Tax Board, and the Ni-geria Customs Service (in thecase of import and excise du-ties) as the case may be on alltax administration matters aswould complement the effortsof those agencies. Such sup-port shall cover amongst oth-ers:

Ensuring that taxpayers mon-ies collected are effectivelyaccounted for and judiciouslyutilised

Communicating to the taxpayer the use to which taxpayer monies are being put

Demonstrating in action andwords that the taxpayer is apriority of government and iswell appreciated

The State Ministry of Edu-cation (FME)

Shall provide support to theState and Federal Ministry ofFinance and the relevant taxand revenue authorities indeveloping a tax cultureamongst Nigerians. The Min-istry through its relevant or-gans shall be responsible forensuring the inclusion of tax-ation in the curricula of edu-cational institutions in the State

from primary to tertiary insti-tutions based on a cradle tograve concept.

The State Ministry of Infor-mation (FMI)

Shall provide support to theState and Federal Ministry ofFinance and the relevant taxand revenue authorities in car-rying out public enlighten-ment campaigns en tax and

revenue matters affecting thecountry. It shall support theprocess of providing accurateand timely information flow toNigerians on all tax and rev-enue matters decided at theState Executive level. In thisregard, it shall co-operatewith the State and FederalMinistry of Finance and therelevant tax and revenue au-thorities to obtain the requiredinformation for disseminationto the public.

Local Government Chair-men are Chief Executives atthe Local Government leveland they would be responsi-ble along with the Local Gov-ernment Councils for the im-plementation and enforce-ment of tax laws at the LocalGovernment level. . Theywould be responsible for over-sight functions on the localgovernment revenue author-ities and provide leadershipand direction to these author-ities. Local

Local Government Councilsshall be responsible for thecollection of revenue at thelocal government level as pro-vided in the Fourth Scheduleto the Nigerian Constitutionand the control and regulationof such other matters as theyare empowered to. They mayalso carry out such other func-tions as may be conferred onthem by the State House ofAssembly.

Government Chairmen shallalso be responsible for liaisonwith the State Ministries ofFinance and the State Hous-es of Assembly with respect torevenue matters, which are

within the jurisdiction of theState or Local Governments.They should also ensure ad-equate funding and staffingof revenue authorities at theLocal Government level.

Local Government Chair-men in the State shall ensurethere is close co-operationbetween the local govern-ments on all revenue matters

and ensure eliminate of mul-tiple taxation.

With respect to revenue gen-eration, it is expected that thelocal government councilsshall carry out this function instrict adherence and compli-ance with the relevant legis-lation as may be enacted bythe State House of Assembly.When required the local gov-ernment councils shallthrough the local governmentchairman approach the StateHouses of Assembly to enactsuch laws as may be requiredfor the efficient and effectivedischarge of their functions.

Local government councilsshall co-operate amongstthemselves to ensure the elim-ination of multiple taxation atthe local government level.

In addition, all Local Gov-ernment (LG) Departmentsand Agencies are required toprovide and share all infor-mation that would assist inthe accurate assessment andcollection of the relevant tax-es. This would includeamongst others:

Having a revenue genera-tion (as distinct from an ex-penditure) mindset.

Strict implementation of taxlaws including overt and ex-plicit support through refer-rals of major cases to tax au-thorities (Federal and State)on a continuous basis and in-tegration of tax “psyche” inthe day to day business ofgovernment

Ensuring proper assess-ment, collection and promptremittance of taxes to desig-nated government accounts.

Ensuring fiscal complianceof every person that they dealwith

Ensuring that every data-base maintained in govern-ment has a compulsory fieldfor the inclusion of the uniquetaxpayer identification numberfor every company, enterprise,individual and other regis-tered organisation

Use of e-payment systems inall transactions inclusive ofdirect remittance to the ac-counts of the tax authorities.

Use of technology and relat-ed systems in the way busi-ness is done - e.g. electroniccash registers, automatedland registries, etc and link-age of databases and suchsystems maintained in gov-ernment to the Federal andState tax authority databases

Ensuring tax is a major con-sideration in the evaluationprocess of individuals and or-ganisations such that the lackof payment of taxes is seen asan affront on government anda crime.

Ensuring that all Tax Clear-ance Certificates and othertax documents used in govern-ment transactions are referredback to the relevant revenueauthority for authentication

Strict implementation of taxlaws including overt and ex-plicit support through refer-rals of major cases to tax au-thorities (Federal and State)on a continuous basis andintegration of tax “psyche” inthe day to day business ofgovernment

•Ifueko Omoigui-Okauru

Vanguard, MONDAY, JUNE 11, 2012 — 35

“This is what the truthis. Going behind whatyou hear first. Asking ahundred questions untilyou make up your ownmind on the basis ofreal evidence.” James AMichener in Hawai.

James Michener wasfor years an editor

before he became a writ-er of historical novels;he wrote over 20 booksand he is one of my men-tors – even in death.When in 1994, I first start-ed writing general com-mentary, the first thingwas to find out the cardi-nal principle of journal-ism and to apply it at alltimes to all situations andissues. It still boils downto finding the facts andnot being swayed by pop-ular opinions. I am stillnot a journalist, and willnever be, but the issue ofAsaba Airport, which tome is still basically aneconomic matter has driv-en me to the farthestlength in recent times ingetting to the bottom of astory. I thank the private

FDI: Our Own Worst Enemy(Asaba Airport As Case Study) – 3

Asaba Airports

donors who are only in-terested in the investmentopportunities the airportwill provide. May be, oneday, I will be able to dothe same for Uyo and Go-mbe Airports. These are“gold mines” waiting tobe mined.

In part two of this se-ries, two text messagesreceived concerning Asa-ba Airport were pub-lished. The first claimedthat N40 billion had beenspent on the project; thesecond asked me to goand find out things formyself. That challengeby the second reader wasaccepted on this pageand I went out in searchof evidence. First , I vir-tually “gate-crashed” intoa retreat organized by theDelta State Government,in Warri, for its Commis-sioners, Permanent Sec-retaries and Special Ad-visers. I requested for

and got and appointmentto discuss with anybodyand everybody who couldprovide informationabout the airport. TheGovernor granted the re-quest on a Saturday and

I was scheduled to arriveAsaba the followingThursday for the officialappointment.

Unknown to the Gover-nor, I dashed to LagosSunday and returned toAsaba on Monday with aretired Airforce pilotfriend in tow; he knows alot about airports havingflown into over 300 world-wide. We wanted to con-duct our own investiga-tion before the officialstook over. We returned toLagos on Wednesday withindependent informa-tion; most of which will beshared with our readers.The only parts left out willbe those pertaining to se-curity – for obvious rea-sons. There is probably nomedia practitioner in Ni-geria today who knowsmore about the airportthan me. I even nowknow a few things theGovernor does not know;because the establish-ment of an internationalairport induces more eco-nomic, social, cultural,environmental and polit-ical changes than a fea-sibility study can capture.

At this point let me pro-vide the answer to thequestions asked aboutfeasibility study and in-creased cost. Yes therewas a feasibility studywhen the airport was firstconceived as a purely adomestic airport. It wasamended when it wasdecided to scale it up toan international airport.Surely, everybody canunderstand that whenyou alter an airport de-signed to accommodatesmall aircraft to onewhich can service the big-gest in the world, 747sand Airbuses, the cost ofconstruction must go up.So there was no “eco-nomic terrorism” in-volved –only under-standable economics ofscale and scope.

However, before goinginto the “heart of the mat-ter”, let me make a few

necessary observationswhich will assist non-Del-tans, as well as Deltansthemselves, to under-stand the state a little bitbetter. In summary, eth-nicity and politics arecombining to make coop-eration for overall devel-opment of the state virtu-ally impossible. The“Pull-Him-Down, PHD”syndrome is probablyhighest in Delta Statethan in most states of Ni-geria. Thus, assessmentof every project, or initia-tive of government, is fil-tered through thoseprisms first making objec-tive appraisals almost im-possible.

Garibaldi, 1807-1882,the Father of modern Ita-ly was once quoted say-ing that, “we have creat-ed Italy, now we must cre-ate Italians”. PresidentIbrahim Badamasi Ba-bangida, IBB, when cre-ating Delta state shouldalso have announced that“we have created DeltaState, now we have to cre-ate Deltans”. Few statesin Nigeria emulate theTower of Babel more thanthose ethnic groups,mainly, Urhobo, Itsekiri,Ijaw, Isoko, Igbo and Ika,in Delta State. Each ofthem holds primary alle-giance to their ethnicgroup first and to DeltaState next. Thus whenBabangida’s governmentselected Asaba as thestate capital, a choice al-legedly influenced by hiswife Maryam, the coupleincurred the everlastingenmity of the “real Del-tans” – defined asUrhobo, Itsekiri, Ijawand Isoko. Making mat-ters worse was the factthat oil production in thestate takes place mainlyin the “real Delta”. As faras they are concerned,their money is being usedto develop a part of Deltawhich really doesn’t be-long there. And for years,“real Deltans”, operating

under the belief that thecapital will soon bemoved to the “real Del-ta”, refused to move per-manently to Asaba. Yearslater, the feelings are stillstrong in many quartersthat any majour expend-iture by Delta State gov-ernment is a waste offunds. So, irrespective ofits merits, the project mustbe denounced. The Asa-ba International, yes, it isgoing to be an Interna-tional Airport in everysense of the word, is onlythe latest, but by nomeans the last project sit-uated in Asaba, whichwill be subjected to delib-erate misinformation andmischief instead of objec-tive analysis. I write assomeone who firststepped on Delta soil in1975 and has conductedcorporate and private(weddings, burials, foun-dation laying ceremoniesetc) in virtually all cor-ners of Delta) on at least300 occasions since then.Only a non-Deltan, readyto go out and find out thetruth can objectively com-ment of Delta; the Del-tans themselves are tooemotionally involved tobe impartial.

First of all, it needs tobe repeated that the Asa-ba Airport represents forme a new and viable eco-nomic resource to whichforeign and domestic in-vestments should be at-tracted. My first threetrips to Asaba, two by airand one by road, wereprivately funded. Therewill be more such trips,God spearing my life, be-cause already, over fiftyfeasible investmentprojects have been iden-tified on account of theairport. In fact, the invest-ments the airport will at-tract will dwarf the cost ofconstruction by almost afactor of one to hundredor more. The real cost ofthe project will soon beaddressed, because it wasa promise given to inves-tigate and report back toour readers. That hasbeen done and permit meto jump the gun by stat-ing categorically, that thetotal contract cost is un-der N30 billion – for aninternational airport;when a runway in Abujawas awarded for N69 bil-lion. Yet, Nigerians havebeen fed with figuresranging from N40 billionto N70 billion. Incidental-ly, none of those peddlingthose outrageous figureshad ever interviewed theGovernor of Delta State.I did. And, he told me au-thoritatively that only N27billion had been spent;and barring unforeseenproblems, the total costwill be less than N30 bil-lion. I challenge anybodyto fault that – and provideevidence.

NEXT WEEK: All youneed to know about Asa-ba Airport and more…

36 — Vanguard, MONDAY, JUNE 11, 2012

BRIEFS

Appointments & Promotionsvicahiyoung@yahoo.com

CO M P T R O L L E R -GENERAL of Nigeria

Prisons Service, NPS, Mr.Zakari Ibrahim and formerChief of Defence, Intelligenceand the Group ManagingDirector/CEO, AbmacsonsGroup, Major-GeneralAbdulmalik Halidu-Giwa rtdare eminent Nigerians that willget this year ’s edition ofLeadtimes Magazine’s awardfor their contributions for peaceand national development.

Others are Katsina StateGovernor, Alhaji IbrahimShehu Shema and his ImoState counterpart, ChiefRochas Okorocha, as well asSenator Abiola Jimobi, theExecutive Governor of OyoState are also doubled asrecipients and special guestsof honour for the event.

left: Chief Audu Ogbeh, Governor Adams Oshiomhole of Edo State; Senator Chris Ngige andChief Tom Ikimi at a fund-raiser organised for the Governor’s re-election at the TranscorpHilton Hotel, Abuja, .

NUPENGnamesAberareActing GSas OkougboretiresN

IGERIA Union ofPetroleum and Natural

Gas Workers, NUPENG, hasappointed Comrade IsaacAberare as the Acting GeneralSecretary of the Union,following the voluntaryretirement of the erstwhileGeneral Secretary, ComradeElijah Okougbo,.

Until the appointment,Comrade Aberare was theDeputy General Secretary(Operations).

A statement by AdamsonMomoh, Senior AssistantGeneral Secretary (Researchand Public. Affairs), said“Comrade Aberare who is agraduate of PublicAdministration of theAmbrose Alli University,Ekpoma, joined the Union in1982 and rose through theranks to the position ofDeputy General Secretary.”

According to the statement,“Comrade Elijah Okougbo,erstwhile General Secretaryof NUPENG voluntarilybowed out of service after 33years of meritorious service tooil and gas workers. Hejoined the Union in 1979 andretired on May 31

st, 2012.

Comrade Okougbo, a tradeunionist and Industrialrelations graduate from thePremier University of Ibadan,and a man of integrity, hadeighteen merit awards andtwo medals during his periodof service.”

“He is now back to privatelife as the Chairman/CEO ofOgo Construction, Industrialand Commercial Services(OCICS) Ltd. and Chairman/CEO; New Age Consult,Lagos. He has been re-appointed as the IndustrialRelations Adviser to thePresident of the Union.”

VETERAN Journalistand ace broadcaster,Dr Yemi Farounbi,

has been appointed NigerianAmbassadordesignate to theRepublic of Philippines.

The renowned journalistwas recently namedambassador designate by theFederal Government.

Speaking on his newassignment, he pledged tostrengthen economic tiebetween Nigeria andPhilippine as well as createopportunity for foreigninvestment in Nigeria.

Fielding questions from

Farounbi, veteran journalist now Ambassador designate

newsmen after a receptionorganized for him in IlaOrangun , Osun state by theManaging Director of FederalRoad Maintenance Agency,FERMA, Jide Adeniji, DrFarounbi, said “Firstly,commercial and economicrelationship will be mypriority ,opening up themarket for Nigerian products,creating a lot of opportunity for foreign direct investmentin Nigeria , so that we will bein a position to create jobs , tostrengthen our power base ,open up our hinterland byrapid hinterland gateway.”

“What Nigeria needs most

now is foreign directinvestment and the market forits products, adding that hewould also work at creatingintellectual linkage betweenthe two countries. We are alsothinking of intellectuallinkages between ouracademic institution ,andforeign institution ,so that ourpeople can have sabbatical inforeign university , the way it used to be , and someforeigners , also to have theirsabbatical in Nigeriauniversity , so that we canbring universe back into theuniversity.”

MPB getsnew PRO

A NEW PublicRelations Officer forthe Military

Pensions Board, Abuja hasbeen appointed.

He is Flight LieutenantMatthias Gboko Tsekaa.

Until his presentappointment, the new imagemaker of the Pensions Boardwas the Acting CommandPublic Relations Officer at theTraining Command, NigerianAir Force, Kaduna.

A statement from the Boardin Abuja, said Tsekaa wasalso the pioneer PublicRelations Officer at Air ForceInstitute of Technology,Kaduna.

Tsekaa, a graduate of PublicRelations from the NigerianInstitute of Journalism, Lagosand Management (PGD) fromAmbrose Ali University, alsoholds certificates in CreativeWriting for the Media andEditing & Proofreading fromPublic Relations Institute ofSouthern Africa (PRISA).

NIMN inducts

new members

NATIONAL Instituteof Marketing ofNigeria, NIMN,

has increased with theadmission of 93 newmembers.

The new members wereadmitted as full members andAssociate members inthe Senior ExecutiveMembership Programme andExecutive MembershipProgramme and Professionalstages of the instituterespectively.

While seven memberswere inducted as fullmembers, having fulfilled allthe requirements of the SeniorExecutive MembershipProgramme, 86 others baggedthe Associate membershipafter scaling through theExecutive Membershipprogramme hurdles.

The institute also used theoccasion to honour late ChiefJoseph Adediran, theinstitute’s first Chairman ofthe Board of Fellows, whopassed on few weeks ago, forhis outstanding contributionsto the development of themarketing practice in Nigeria.

Inducting the new membersin Lagos, the President of theInstitute, Chief LugardAimiuwu, President/CouncilChairman, charged them tostrive to create value sincethat was the essence of themarketing practice.

SWEET SensationCon fec t i onar i e s , a

Quick Service Restaurant,QSR, has Bagged the maidenedition of the Nigerian FoodIndustry Awards, NFIA.

The company wasrecognized for quality andexcellence in the foodindustry.

According to the organizersof the Awards, the award wasto recognize, celebrate andreward innovative individualsand organizations that havedemonstrated excellence inthe Nigeria Food Industry;thereby ensuring morecommitment of stakeholders tohaving world-class foodquality standards andsecurity in Nigeria.

The “Nigeria Food IndustryAwards” is a consumer choiceaward initiative of a group ofyoung Nigerians that used anindependent research firm toconduct surveys in majorNigerian cities. According tothe organizers “this is aunique award in that thewinners are determined by

Sweet Sensation bags NFIA Awardboth consumers and a panelof judges made up of high-standing professionals.Another objective of theawards is to create a healthycompetition amongst Nigeriafood companies; an activity

that will encourage theimprovement of food quality,safety, hygiene and servicesthat will ultimately safeguardthe health of Nigerians andreduce hunger in the world atlarge.”

Ibrahim, Halidu-Giwa, others get award

The programme which istitled: African Leadership andthe War Against Corruptionisbilled for June in Abuja.

In a statement by the BoardChairman of the LeadtimesAfrica Magazine, ProfessorBuba Mshelia, “thesepersonalities have lived aboveboard in their performance intheir various states. They havebeen able to impact positivelyon the people of their states;infact they are symbols andapostles of good governance inAfrican Leadership. Mr. ZakariIbrahim, Comptroller of Nigeriaprisons service and GeneralAbdulmalik are as well anexample of transparency,accountability, and integrity intheir strategic positions ofnational development.

Vanguard, MONDAY, JUNE 11, 2012 — 37

Agric Business

Global food prices havedropped sharply in

May due to generally favour-able supplies, growing globaleconomic uncertainties and astrengthening of the US dol-lar, FAO said today.

The FAO Food Price Index,measuring the monthlychange in international pric-es of a basket of food com-modities, fell by four percentin May. It averaged 204points and was 9 pointsdown from April. This wasthe lowest level since Septem-ber 2011 and about 14 percentbelow its peak in February2011.

”Crop prices have comedown sharply from their peaklevel but they remain stillhigh and vulnerable dueto risks related to weatherconditions in the criticalgrowing months ahead,” saidFAO’s grain analyst Abdolre-za Abbassian.

FAO at the same time raisedthe forecast for world cerealproduction by 48.5 milliontonnes since May, mainly onthe expectation of a bumpermaize crop in the UnitedStates.

FAO’s latest forecast forworld cereal production in

FAO Food Price Index drops sharply2012 stands at a record levelof 2 419 million tonnes, 3.2percent up from the 2011record.

The bulk of the increase isexpected to originate mainlyfrom maize in the UnitedStates amid an early start ofthe planting season and pre-vailing favourable growingconditions. As a result, theglobal coarse grain produc-tion is forecast at 1 248 mil-lion tonnes, a huge 85 million

tonnes increase from the pre-vious year.

However, with planting stillto be completed and much ofthe crop at very early stagesof development, the final out-come will depend greatly onweather conditions in thecoming months.

With the main northern hem-isphere rice crops now in theground in several countries,the forecast of global rice pro-duction in 2012 is firmer and

points to a 2.2 percent in-crease from 2011, to some 490million tonnes, mostly reflect-ing larger plantings in Asia.

For wheat, latest indicationspoint to a contraction of about3 percent in production in2012, to 680 million tonnes,still well above the average ofthe past five years. The glo-bal cereal utilization is fore-cast to expand by at least 2percent in 2012/13, to 2 376

million tonnes, with feed uti-lization growing by 3.8 per-cent, while food consumptionis expected to increase by justover 1 percent, largely keep-ing pace with world popula-tion growth.

At the current forecast lev-el, world cereal productionwould exceed the anticipatedutilization in 2012/13 (whichhas been revised up since lastmonth by 19 million tonnes or1 percent) and lead to a sig-nificant replenishment ofworld cereal stocks, up 36million tonnes, or 7 percent,from the previous season.

British American TobaccoNigeria Foundation

(BATNF) has reaffirmed itscommitment to continuouslysupport the agricultural sectorin the country as a vitalsolution to poverty, dwindlingeconomy and unemployment.

Speaking at theBusinessDay 2012Agribusiness and FoodSecurity Summit tagged“Enhancing Agriculture Value

BATNF reaffirms commitment to enhanced Agribusiness– Chain for EconomicProsperity” held in Lagosrecently, Mr. GbengaIbikunle, Executive Director,British American TobaccoNigeria Foundation(BATNF), said “It isimperative to note thatagriculture is undoubtedlyinstrumental to nationaldevelopment for economicsustainability. It is in this veinthat the nation needs toengage in national re-orientation, new thinking andnew partnerships aimed atprojecting and promotingagriculture”.

Ibikunle speaking further

said this year’s agribusinesssummit is a transformativeinitiative focusing largely ongrowing food securityconcerns and moreimportantly about how tounleash the largely untappedpotential of the Nigerianagribusiness sector in thearea of value chain processes.He added that “theagricultural support fund willspur investment into theagribusiness sector with theultimate goal of inclusive jobcreation and promotion ofinnovative, environmentallysustainable approaches toagriculture value chain.

BATNF belief thatemployment generation andpoverty reduction are directlyrelated informed the decisionto collaborate with NationalDirectorate of Employment(NDE) in creatingemployment opportunities bytraining indigenes on poultryenterprise management inOndo State. A three year fishenterprise developmentproject was also implementedin Araga farm settlement atEpe with collaboration fromthe Department of Fisheries,Lagos State Ministry ofAgriculture”.

BY PRINCEWILLEKWUJURU &CHINEDU IBEABUCHI

38 — Vanguard, MONDAY, JUNE 11, 2012

Aviation

By LAWANI MIKAIRU

Since the clash ofDana Airlineplane on the 3nd

of June ,2012, in Lagoskilling all thepassengers on board andresidents of the crashedsite, there has been outcry about the ages ofplanes operated byAirlines in Nigeria. Thegeneral believe of mostcommentators, thoughmost not aviationexperts, is that mostairlines in Nigeria havein their fleets planes tooold to fly. The revelationthat the DANAMcdonnel Douglas 83that crashed was almost22 years old furtherfueled the call that allold planes should begrounded and phasedout.

But world renownedp i l o t s , a e r o n a u t i cEngineers, Air ForceGenerals havemaintained that it is notthe age of an aircraft thatdetermine its safety butthe level of maintenanceof the aircraft. AirMarshal Malcolm S DWollen an Indian AirForce General and warveteran said in an articlepublished in the IndianExpress that ‘’ the ageof the MiGs is not a realproblem as every aircraftis overhauled after apredetermined numberof hours. It is acceptedfor service use only if itfully meets therequirements for brandnew planes ‘’ He wentfurther to stress that‘’the causes foraccidents vary for eachdifferent type of aircraft,but common causes, aselsewhere in the world,are Human Error andTechnical Problems’’.

He then said thatevery aircraft must haveessentially materials/components installed/supplied that are tospecification anddimension, especiallyfor engine, fuel andhydraulic components;and that overhaul/

,

,

Does the age of an aircraftguarantee safety ?

maintenance proceduresmust be rigidly observed. No aircraft anywhere inthe world can beconsidered airworthyunless the aforesaid isdone.

Air Commodore JasjitSiwas not the age of theplane that caused theaccident. Singh furthersaid Technical Defectaccidents occur due tointerplay of a complexset of factors. Technicaldefects leading to anaccident could be eitherdue to an inherent or aninduced problem. The

properly. It induced andOperational Factorswhich can also beinduced’’

He then said thatevery technical defectaccident has to beanalyzed andinvestigated thoroughlyso that appropriateremedial measures canbe taken.

Back home in Nigeria,between 22

nd October,

2005 and 29th

October,2006 within a period of11 months three majoraccidents occurredwhich took the lives of312 people. These threesuccessive accidentswithin 12 months periodaccounts for 72% of theentire 33 years accidenthistory of Nigeria.

According to CaptainMuhammed Joji ‘’It isworth knowing that inmost of these accidentsthat claimed the lives ofover 900 people therewas no single structuralor components failure ofthe aircraft. All theaccidents wereattributed to humanfactor,—Pilot errorexcept one attemptedhijack ‘’

Captain Joji furtherargued that there is nocorrelation betweensafety and the age of anAircraft. He said thedecisions to retireaircraft are basicallyeconomic. Ageingaircraft requires morefrequent maintenancethan new aircraft. Mostaviation experts agreethat a well maintainedold aircraft is better thana poorly maintained newaircraft. New aircraft areoften purchased to addcapacity to the existingfleet not to immediatelyreplace existing fleet.

Therefore imposing a22 year life span limiton an aircraft, as it hasbeen done by regulatoryauthorities in Nigeria isnot consistence with theICAO standard andrecommended practices.There is need for all notbe too emotional whendiscussing air safety andaircraft.

primary factors areaccording toh i m ’ ’ D e s i g ninadequacies, which isi n h e r e n t ;M a n u f a c t u r i n g /Overhaul Quality whichis induced.Maintenance which canbe ngh ,another AirForce General cautionedin his article thatCorrespondents shoulduse a lot of restraintwhile writing oncomplex technicalmatters. He cited A-320accident at Bangalore in1990 as a case inexample where fly-by-wire did not help whenthe pilots failed tomanage energy

The age of theMiGs is not areal problem asevery aircraft isoverhauledafter apredeterminednumber ofhours. It isaccepted forservice use onlyif it fully meetsthe equirementsfor brand newplanes

L-R, Chairman, Airlines Operators of Nigerian (AON), Dr Steve Mahonwu, Sec. Gen.Capt. Muhammed Joji and Director, Flight Operator, Dana Air, Capt. Oscar EdwardWason at a press conference on crashed Dana Aircraft at the Murtala MuhammedAirport, Ikeja, Lagos Thursday.

Vanguard, MONDAY, JUNE 11, 2012 — 39

BRIEFS

Media & Advertising

The sponsorship ofFive-Aside footballcompetition by

Nigerian Breweries Plc,makers of Gulder larger beerthree years ago, chances arethat the company never reallyenvisaged the magnitude ofsuccess it had achieved.

With the deluge of severalother football competitionswith similar thrust, it wasalways going to be achallenge to position theGulder Five-A-Side as afootball competition of note.

Three years on and the storyis one that is surely a delightin the ears of the organizers.

Five-Aside soccer: How Gulder isaffecting grassroot devt

Indeed, if there ever was anydoubt as to the popularity ofthe competition, it wascertainly dispelled with thenumber of football teams thatshowed interest to be a partof the soccer fiesta. Morethan 3000 teams registered tocompete in the event from allparts of the country. Massivecrowds consisting of footballteams turned up at the sixzones where the qualifierswere played. And the gamesitself were a testimony to thegrowing talents that aboundin the country as they took tothe pitch seeking to outdoeach other.

So what is the secretformula for Gulder Five-A-Side success story? Maybe it

could be the fact that onecorporate body is finallytaking the issue of grassrootsfootball developmentseriously. It is a well knownfact that football developmentin the grassroots level doesnot seem to be top in thepriority of Nigerian Footballadministrators. Thoughsuccessive administrations,including the present one,has saddled on itself, theresponsibility of managingfootball in the country,nothing significant has comeout of its efforts. This is inaddition to the whooping sumof monies doled out to theNigerian Football Associationfrom the FIFA, theinternational footballgoverning body’s coffers. For

the custodians of the footballgame in the country, it hasbeen all talk but little knownaction with respect todeveloping football.

This makes it the moreimperative for seriouscorporate bodies to inteveneand help save the dying gameof football at the grassrootslevel via sponsorship oftournaments. With GulderFive-A-Side joining the fray,more and more of theseexciting talents have aplatform to showcase theirtalents. The regionalqualifiers for the competitionmoved across six states of thefederation, Benue, Enugu,Delta, Rivers, Ogun andLagos States with two teamsemerging from each of thezones. All of the zones sawvarious teams coming in fromother states to participate inthe host states. The tourneywould surely serve as aninvaluable experience to theaspiring football superstars intheir quest for a successfulfootball career. For most of theteams, Gulder Five-A-Sidewas their biggest footballcompetition in their fledgingcareer.

Speaking on thecompetition, TonyAgenmonmen, MarketingManager, Lager (lager),Nigerian Breweries Plc., thecompetition would helpbudding talents across thecountry showcase their skills.“What Gulder is doing isgiving the fantastic talents wehave scattered all over thecountry an opportunity todisplay their talents. Thistournament will help thebudding talents as they striveto become the next worldchampions in football,” hesaid.

…33, Dubic may re-strategise

Beer Market: Goldberg re-entry stirs media war

The majority stakeacquired by Nigerian

Breweries (NB) Plc in January2011 and the supervision ofthe manufacture of Goldbergbeer from Sona BreweriesLimited, seems to havebreathed a new life into theproduct and the beer market.

The re-launch of the beer inIbadan, the Oyo state Capitalbelieved to be the strongholdof the product is a sign thatthe beer is set to consolidateon its hold on the Westernregion market, particularlynow it’s been re-filtered.

Before now, the beer had notcommanded enoughrecognition from beerdrinkers, all because it wasplaying regional.

But from observation,Goldberg is coming back withthe distribution chain frameand network of NB Plc, to

trend the part of the leaderbeers.

Earlier, Goldberg was notvisible on the airwaves. It’sunique selling point thistime, may go beyond theword of mouth campaign, ifgoing by media plans to beorchestrated by its producers,reason is that the beer hasbeen brewed lighter andcrispier.

In the next few months,media war will subsist,because the new pride willpush for visibility in themarket with Below andAbove-the –line campaign,and thus will effectively stirmedia war as other brands inthe same category areplanning a fight back.

According to Al Reis, abrand and Public relationsexpert had posited that, “ Ifnew product or existing one

(s) is or are re-introducedparticularly where it hascompetitors already in themarket, there’s definitelygoing to be a media plan topush the brand, and olderbrands will re-strategize toconsolidate on their marketposition.”

With the re-introduction ofGoldberg, a new battle linehas been drawn among equalslike 33, Harplime and Dubic,which eventually will boosttotal media budget for 2012 inthe half year result.

Simon Adeyemi-Cole, brandconsultant toed the line of AlReis when he said that newproducts which is playing inthe same category of existingbrands will call for new witcampaigns.

Goldberg, with a distinctivepackaging; New crown cork,bottle, labels and improvedproduct quality, at a tradebriefing was welcomed withdance and music, amidst

king-like display by the GoldCity king and a splendidperformance by Wande Coal.And Ace comedian, SeyiLaw.

To some consumers,Goldberg has been redefined,tastier and smooth and cannow be compared to others inthe market.

That was why Mr. WalterDrenth, Marketing Director,NB said, the beer was anoutcome of a painstakingprocess of refining Goldbergto give it the usual taste ofhigh quality, sequel to itsaddition to the company’sbrand portfolio following theacquisition of anotherbrewery that hitherto brewedthe product.

Drenth explained that ittook the Nigerian Brewerieschief brewer and his technicalteam over six months ofmeticulous process of refiningthe product with a view tobringing value to customers.

AAAN holds 39th

AGM

The Association ofAdvertising Agencies of

Nigeria (AAAN) hasconcluded plans for its 39thAnnual General Meeting/Congress scheduled for 28

th

through30th

June, 2012 inIbadan, the Oyo Statecapital.The theme of thisyear ’s AGM/Congress is“Strategic MarketingCommunications &Governance”.According to Mrs. YinkaOgunde, the Association’sEvent Planning CommitteeChairman, said the theme ofthis year’s AGM/Congress isto further provide aprofessional platform forgovernment at all levels,parastatals and agencies .

To stress the importance ofthis event, the Association isinviting Mr. Jimi Awosika,Managing Director/CEO,Insight-Grey as the keynotespeaker. The lead discussantsare Mr. Bosun Ladele,Commissioner of Information,Oyo State; Mr. ToluOgunkoya, past MIPANPresident, and Mr. KolaOyeyemi, ADVAN President.The event will be chaired bySenator Akin Odunsi, adistiguished seniorpractitioner and Senator ofthe Federal Republic ofNigeria.

The AGM/Congress openon Friday, 29

th June, 2012.

FPH & Casino

hosts NEA awards

nomination

For the second timerunning, Federal PalaceHotel and Casino is

collaborating with theNigerian EntertainmentAwards to sponsor the awardsnomination night.The 7th NigerianEntertainment Awardsnomination night saw about150 celebrities nominatedfrom different categoriesacross the entertainmentindustry holding in New YorkCity in the United States, US.In the course of the evening,some of the celebrities tooktheir first gaming lessons atthe slots machines and poker/black jack tables and laterexpressed their joy andexcitement at the veryrelaxing nature of gaming atthe hotel.David Kliegl, GeneralManager, FPH &Casino, saidhe was delighted at hostingthe annual event and itserves, as a means of showingthe entertainment industrythat the hotel is theentertainment destination ofchoice where a million thrillsis available in onedestination.“We will continue to showcaseour world class casino as anup-market alternativeentertainment destination inLagos,” he said.

STORIES BY PRINCEWILL

EKWUJURU

A team waiting for their turn to take on the field of play at the Lagos zonal qualifiers of theGulder Ultimate Five Aside Football qualifiers held at the NIS, National Stadium, Surulere,Lagos.

CMYK

Omoh Gabriel - Group Business EditorBabajide Komolafe - Acting Finance Editor

Clara Nwachukwu - Energy EditorPeter Egwuatu - Head, Capital MarketYinka Kolawole - Snr Bus. CorrespondentFavour Nnabugwu - Insurance CorrespondentGodwin Oritse - Maritime Correspondent

Godfrey Bivbere - Maritime CorrespondentYemi Adeoye - Energy CorrespondentOscarline Onwuemenyi - Energy CorrespondentFranklin Alli - Industry Reporter

Michael Eboh - Capital Market ReporterAmaka Abayomi - Money market ReporterEbele Orakpo - Energy ReporterIfeyinwa Obi - Maritime Reporter

CONTRIBUTORSPrincewill Ekwujuru - Media/MarketingNaomi Uzor - Industry

Providence Obuh - Capital MarketLAYOUT - Graphics Department

0817 002 3569

It is now clear thatover 150 innocentsouls perished last

Sunday as a result of theDana air crash. Theseunfortunate souls mayhave since been joinedby many more, whohave tragically lost theirlives nationwide as aresult of the inertia inone government agencyor the other. Nigerianscommiserate withfamilies and friends whohave become bereavedas a result of wantonnegligence, be it in theair, our roads, ourhospitals or indeed, asa result of the laissez-faire indulgence ofg o v e r n m e n t ’ sregulators in theaviation, banking,pension, and capitalmarket subsectors. May the souls of theseunfortunate fellowNigerians rest in perfectpeace and may the goodLord grant their familiesand friends the fortitudeto carry on. Now, some readersmay wonder what aweak naira has got to dowith an air crash afterall; the regulatoryagency, Nigerian CivilAviation Authority(NCAA) and theoperators of DanaAirline have beenfingered as villains ofthis disaster. TheNCAA has already beenwidely castigated forallowing Nigerianairlines to operate withold aircrafts, which,worse still were notstrictly subjected to theappropriate schedule ofmandatory servicechecks. In addition,critics have also decriedthe obsolete airportn a v i g a t i o n a linfrastructure and localfacilities for aircraftservice andmaintenance. Dana Airlines, on theother hand, is accusedof running its service

The role of a weak Naira in Dana air crashwith old planes, whichrun more schedules thanare appropriate for theage of such aircrafts. Inresponse to the currenttragedy, the Minister ofAviation has set up apanel of notable expertsto look at themaintenance practicesof all domestic operatorsincluding Dana Airlineand the effectiveness ofNCAA’s oversight ofmaintenance practices. The Panel would alsoexamine themanagement and safetyculture of all domesticairlines and thereaftermake ‘bold’recommendations forthe improvement of thesafety of the Nigerianairspace. Incidentally, these arebroadly the same termsof reference of othergovernment panelsinstituted in the past inresponse to airlinecrashes. It is likely thatif earlierrecommendations of thevarious panels set up inthe last 30 years hadbeen properlyconsidered andimplemented; perhaps,Sunday’s tragic losscould have beenavoided. However, in view ofthe historicalantecedents, of suchi n v e s t i g a t i v e /administrative panels,the likelihood is that theobservations of theAviation Minister’spanel 2012 wouldultimately find a placealongside the dustyshelves carrying earlierreports of investigationsof similar catastrophes. In the event that theblame for this airdisaster has beensquarely placed at thedoorstep of the airlineoperators and therelated regulatoryagency, NCCA, onemay ask again, what hasa weak naira got to do

with air safety? To answer thisquestion, maybe itwould be appropriate todraw from the exampleof car usage in Nigeriato explain the linkbetween the value ofthe naira and thequality of our imports. Most graduates fromNigerian universities inthe 1970s and early 80swill recall that the carallowances, which they

were invariably paid,six months or so, aftertheir employment waslargely adequate topurchase brand new (tear rubber) cars oftheir choice. Inaddition, moste s t a b l i s h m e n t sprovided allowancesthat would repay thevalue of the car loanswithin three to fouryears, and thereafteralso provide a freshloan for another newautomobile. For thisreason, it was unusualto see second-hand carlots in any part of thecountry. This culture,however, began torapidly change as thenaira value wasgradually officiallydevalued from less thanN1=$1 to the currentlevel of N160=$1. Thus, a state of the art504 GL with leatherupholstery, air-conditioner, taintedglasses, etc, sold for lessthan N7,000, whiletoday, that amountcannot even buy oneused tyre. A new car ofsimilar quality today,will cost in excess ofN7,000,000. In theevent that incomes werelargely stagnatedagainst the backdrop ofa rapidly depreciatingnaira, it becameimpossible for mostNigerians to purchasenew cars. In responseto this reality, thegovernment allowed

importation‘for sale’ ofcars thatwere notmore thanfive yearso l d ! However,a sgovernment’sdeliberaten a i r adevaluationcontinued,this agelimit wasextendedto 10 yearsa n dsubsequently,15 yearsold carsw e r e

ultimately admitted forimportation. In otherwords, since Nigerianscould not afford brandnew models, our roadswere flooded with thosecars, whose usage hadbecome a liability fortheir owners abroad. God knows how manyNigerians have sadlylost their lives as a resultof driving poorlymaintained, well usedold car imports. Inevitably, as in the

auto business, so also itis in the aviationsubsector; a new plane,which costs, say, $30million in 1975 could bebought by a Nigerian airtransport operator forless than N25 million. Today, such a planecould cost about N4.5bn,and, if the purchaseloan for the aircraft wasfunded domestically, theairline may have to payinterest at over 20%. Inthe face of sucheconomic reality,Nigerian airlineoperators had inevitablytraded downwards; withthe result that most

aircrafts in our domesticair space have anaverage age of about 20years (Arik Air appearsto be the mainexception). Worse still,the domestic airlineoperator often finds thatthe weak value of thenaira has similarlyaffected their incomes,as the abject level ofpoverty in the countrynot only reduces thevolume of passengers,but also makes itdifficult to makepremium charges fortheir tickets. Nonetheless, theairline operators areconstrained to pay closeto the internationaldollar benchmark pricefor their aviation fuel! Consequently, theairline business hasbecome a cutthroat, dog-eat-dog enterprise withminimal margins andeternally rising costs. The net product of theabove market mix wouldexpectedly be a diligentattempt by operators toreduce cost in everymanner. To this end,

they would buy cheapaircrafts that are over 20years old; delay theservice schedule of theirplanes, and possiblyeven run an exhaustiveschedule so as to get themaximum return oneach plane! So far, there is nothingto suggest that thequality of pilots andtechnical crew flying theNigerian air space isless than optimal. So,we may safely discountthis factor as a majorcause of air crashes inNigeria. This is not tosay either thataffordability of youngage planes would totallyeliminate air crashes,but there is no doubtthat the rate of suchdisasters would beminimized ifgovernment and theappropriate regulatoryagencies also provideds t a t e - o f - t h e - a r tinfrastructure andmaintain optimaloversight function overthe staff and quality ofequipment of all airlineoperators. SAVE THE NAIRA,SAVE NIGERIANS!