Financial 02 December 2013

DECEMBER 2, , , , , 20132013201320132013

Continues on page 18

From left: Arunma Oteh, DG SEC, Bala Mohammed, FCT Minister, Suleyman Ndanusa, Chairman SEC and LeonardoGomes Pereira, DG SEC Brazil during the 3rd annual Capital Market Retreat, theme “Actualising Nigeria’s EconomicPotential” Abuja.

Price of rice has hit the roof andlow quality brand has floodedthe market just as farmers have

threatened to stop rice cultivationaccording to Tunji Owoeye, Chairmanof RIMIDAN (Rice MillersImporters Association of Nigeria).

He said that farmers have threatenedto stop production of rice as the Millers/Processors are no longer buying fromthem. The Processors stopped buyingbecause they could not compete withthe smuggled imported rice. The price

Price of rice goes up,scarcity looms as poorquality floods market

By SUNNY IKHIOYA &GODWINE ORITSE

of rice is soaring at a very alarming rate.Presently, a good brand costs N13, 000and above. The fear is that prices of ricewill further go up as Christmas andNew Year festivities approach. Whilesmuggled imported rice cost about N10,000 in the open market locally producedrice cost as much as N13, 000. Thequality of the smuggled rice is of lowgrade.

According to Financial Vanguardmarket survey since the imported ricein the market do not go through officialchannels like the Customs and Standard

Organisation of Nigeria (SON), allimaginable types are now smuggled in.It is a situation of “anything goes”thatis available in the markets place now;most of them are re-bagged in Nigeriaand of very low quality standards. Alady, Mrs. Toyin Adegbenro, who doesher shopping at Agege market axis,complained that rice in the market hasbecome tasteless, no matter how wellthe stew or soup is prepared. The fallout of current policy on rice policytherefore is an influx of sub standardrice into the Nigerian market and this

is very dangerous to the health and wellbeing of the Nigerian consumers.

FG to rethink policyTHERE is however strong indication

that the Federal Government may havea rethink about the high tariff on rice.This indication was given by theChairman, Presidential Committee onTrade Malpractice, Alhaji Dahiru Ado-Kurawa, who said Government wouldsoon review tariff on rice, to tackle

CURRENCY BUYING CENTRAL SELLING

CBN Exchange rate as at 29/11/2013

111.29 +0.43

93.70 +1.40

109.8 2.2

2,793.00 +23.00

17.23 0.01

DOLLAR 154.72 155.22 155.72POUNDS 252.7661 253.5829 254.3998EURO 210.6358 211.3165 211.9972FRANC 171.1126 171.6656 172.2185YEN 1.5123 1.5172 1.522CFA 0.3017 0.3117 0.3217WAUA 236.765 237.5302 238.2953RENMINBI 25.3872 25.4697 25.5522RIYA 41.2532 41.3865 41.5198KRONA 28.2325 28.3238 28.415SDR 237.5261 238.2937 239.0613

CMYK

18 — Vanguard, MONDAY, DECEMBER 2, 2013

Continues from page 17

Continues on page 19

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The Entrepreneurial Revolution:A New Order for Nigeria PT 2

Significant lessons could also be learnt from MargaretThatcher’s economic policies that propelled Britainto an economic boom in the ‘80s through extensive

promotion of entrepreneurial initiative and share-ownership.Thatcherism’s thrust on substituting debt with equity spawnedcolossal economic development in the UK, which was soonadapted and replicated across Southeast Asia.

In the 20th century the USA traded their entrepreneurialrevolution which they enjoyed in the previous 200 years andbegan a 50 years stint of dependence on the modern daycorporation. The myth of job security prevailed in the past50 years. This is now gone. Renowned historians like WillDurant wrote about this in 1944.Leaders like MahatmaGandhi, Franklin Roosevelt and Stephen Covey had alsowritten and spoken about it.

For sure, Africa represents uniquely different realities andchallenges, and there is no effective model than can beentirely transplanted here. Policy makers must prioritiseinstitutional efforts to compensate for reigning socio-economicrealities. Nigerian initiatives to pursue financial restructuring,for instance, have been largely hamstrung due to civil andpolitical unrest. Likewise, Abuja’s insistence on micro-enterprises, instead of small-scale ventures, has done littleto help its burgeoning urban unemployed work force.

A viable economic agenda for Nigeria that allows rapidentrepreneurial progress has to focus on fundamentaladjustments:

•Creating a pro-active socio-economic environment thatencourages creative and viable entrepreneurship from thegrassroots level up. Indentifying and correcting infrastructuredeficits and systemic imbalance inimical to small business.

•Developing a credit regime – through relevant financialand industrial policy changes – that is sympathetic to smallbusiness realities. Promotion of lending through equity, andnot debt, is of critical importance.

•Removing administrative and trade barriers whilesimultaneously enhancing technical support and capacitybuilding assistance for both existing and emergingentrepreneurs.

•Mobilising the country’s significant human resources poolby revamping the education sector to provide vocational,administrative and skill development training to rural andurban youths.

•Creating efficient and effective mechanisms for regulationand oversight of enterprise-development initiatives ingeneral, and microfinance institutions in particular.

•Maintaining political stability and authority of democraticinstitutions; fighting corruption and building social consensuson important issues to ensure broad-based success ofmacroeconomic policies.

Another important consideration to this discourse is thedifference between policy and implementation, which can atleast partly be viewed as the difference between developedand developing nations worldwide. The best policies cometo naught unless adequately executed, and the Africancontinent provides a long list of such examples. Obasanjo’sedict on entrepreneurial studies could very well end up beingthe next one unless successive governments follow it throughin both letter and spirit.

To accomplish durable prosperity, Nigeria needs to exploitits tremendous economic potential with innovativegovernance, together with an ironclad shift against endemiccorruption. Interventionist policies and institutionalmismanagement are potentially far more damaging in thelong-term than, for example, the current economic crisis. Atwofold agenda of reform and regulation, with effectiveimplementation, is crucial to achieving the entrepreneurialrevolution that will help the Nigerian economy overcome itstrouble legacy.

The world looks with envy at the unprecedented growth ofChina and India.

These two Asian giants were still in the landscape of pre-industrial agricultural economy when Nigeria was alreadysetting up factories. Today they are enjoying the blessing ofa borderless interconnected world economic order.

Nigeria needs to follow through on its significant economicpotential with sincere governance and effective planning,together with an ironclad shift against endemic corruption.Interventionist policies and institutional mismanagement arepotentially far more damaging in the long-term than, forexample, the current economic crisis.

Cover Story

From left: Okoghenun Paul, MD Rahony Nigeria Limited; Oluwasusi Olagoke Familoni,Corps Commander (CC) CTSO; Abdul Bamgbopa, CEO, SATTRAK Services Limited; andNimota Oritsesemaye Okoro, Representative of Zonal Commanding Officer, Zone RS 2Command HQ Federal Road Safety Commission at the FRSC Stakeholders Forum held inLagos.

smuggling and revenue loss.Ado-Kurawa said in Lagos

that the planned downwardreview was aimed at reducingthe level of smuggling of thecommodity from BeninRepublic. He observed that theFederal Governmentintroduced the rice policy of110 per cent duty and levy inJanuary, to boost local riceproduction.

“The Federal Governmentwill likely adjust the policybecause it has escalated theinflux of smuggled rice fromneighbouring countries. BeninRepublic is one of the highestimporters of parboiled rice, thecountry that ordinarily importsabout 230,000 tonnes perannum now imports about 2million tonnes. The two-million-tonne parboiled riceimported by Benin is allsmuggled into Nigeria,” thechairman said.

He recalled that thestakeholders met recently inAbuja and advised the FederalGovernment to review the ricepolicy and sift out the greyareas. This, he said, was toensure that the government’squest to halt rice import wasachieved. Ado-Kurawalamented that Nigeria lost overN2 billion to smugglersthrough land borders.

According to him, Nigeriathat used to be the highest riceimporter, had suddenlyrelinquished the position toBenin Republic.

Rice farmers say smugglingwill hinder success of riceimportation policy

Meanwhile Chairman,Rice Farmers

Association of Nigeria(RIFAN), South-West zone, Mr

Price of rice goes up, scarcity loomsas poor quality floods market

Olusegun Atho, has said thatunless smuggling is tackled,the current policy on importedrice will yield no result. Heidentified smuggling as themajor factor that would hinderany ban on the importedcommodity, just as it hadadverse effect on local riceproduction.

According to him,“Government needs to comeout and deal with the issue ofsmuggling, in order toencourage local growers.’’

The RIFAN chairman alsoadvised the government toprovide adequate funding byway of grants or loans tofarmers. “These factors are veryimportant and must be put intoconsideration, before theproposed ban. If these thingsare not in place, the ban cannotbe realistic. Until whengovernment begins to dosomething about it, that iswhen we can see theseriousness.”

Atho also appealed togovernment to construct moredams and provide mini-pumping machines for farmersto prepare them for irrigationfarming as well as introduce

modern rice productiontechnology. “If governmentcan provide all these tofarmers, that is whengovernment can boast of self-sustainability.”

Local rice farmers to begiven incentive

Meanwhile, the FederalMinistry of Agriculture andRural Development also saidthat local rice farmers wouldbe given incentives forincreased rice production.

Dr Kayode Oyeleye, aSpecial Assistant to theMinister; Dr AkinwumiAdesina, said that the gesturewas to make the price oflocally produced ricecompetitive to the importedvariety. Oyeleye said that thetariff on imported riceremained high because theFederal Government wasencouraging theconsumption of locallyproduced one.

The special assistant alsosaid that this would alsostrengthen the economy ofthe country as importation ofrice would reduce.

Nigerians applaud policybut

Much as Nigeriansapplaud the efforts of theMinister and other Officialsof the agric ministry, in theirattempt to boost andencourage local production;they deplore the hastyintroduction of the highimport tariff when a thoroughanalysis of the situation onground has not been done.They argued that it isdangerous to play politics orscore cheap political pointswith issues that affect the

He identifiedsmuggling as

the major factorthat wouldhinder any banon the importedcommodity, justas it had adverseeffect on localrice production

CMYK

Vanguard, MONDAY, DECEMBER 2, 2013 — 19

Business & EconomyContinues from page 18

,,

By TONY NAVAHOKONMAH

There have been talks ofAfrica’s financialintegration for more

than two decades, but therearen’t any concerted, credibleand encouraging signs thatAfrica is nearing its goals andobjective of financialintegration apart from a fewdisjointed accounts fromvarious analysts’ opinions onAfrica’s regional financialintegration achievements.

Analysts have argued thatAfrican regional economiccommunities (REC),recognising the need forpooling of financial resourcesbegan establishing sub-regional capital markets in anattempt to solve the problem oftheir fragmented capitalmarkets. Realising the fact thatthere is a strong relationshipbetween developed financialmarkets and economic growth,African regional economiccommunities (REC) saw theneed to integrate andconsolidate financial markets asa vehicle for promotingeconomic development on thecontinent. REC also believedthat financial integration wouldenhance, promote efficiencyand productivity and facilitatethe flow of information. Indeed,regional financial integration isseen as the only platform forestablishing stronger links withfinancial systems and capitalmarkets in more developedcountries and economies.

But, has REC been able toestablish this stronger links orhas it the capacity to establishthis stronger links with financialsystems and capital markets inmore developed countries?Kuper, S. (2013) argued thatsince 2000, Africa has been

As it is the practice in Vanguard that a newspaper is amarket place of ideas, we give readers opportunity to expresstheir views on issues raised in the paper. Here is one ofsuch views by a reader in London.

Why Africa’s financialWhy Africa’s financialWhy Africa’s financialWhy Africa’s financialWhy Africa’s financialintintintintintegration is difegration is difegration is difegration is difegration is difficultficultficultficultficult

going off in differentdirections. President JacobZuma, the South Africanpresident, in a speech whilespeaking on issues of toll roadsrecently lends credence toKuper’s claim, and it is one ofthe reasons why Africa’sfinancial integration hasproved difficult. “We can’tthink like Africans generally,we are in Johannesburg. Thisis Johannesburg. It is notsome national road inMalawi”. If indeed, the beliefof REC is to enhance, promoteefficiency and productivitywithin regional communities,I do not see how Zuma’sstatement meets this objective.

Ironically, South Africa andMalawi are both members ofthe same African regionaleconomic community calledSouthern African DevelopmentCommunity (SADC) whereSouth Africa dominates theregion economically,accounting for 60% of SADC’stotal revenue and about 70%of SADC’s GDP. Evidently,South Africa has a critical roleto play in the regionalfinancial integration of thatregion. Therefore, suchcareless utterances of a highpolitical figure like thepresident of South Africawhich ridicules the economicand social development of amember country will notpromote the desiredcooperation that encouragespositive and strong financialintegration of that region andAfrica as a whole.

Analysts believes that

financial integration involvesa process whereby a country’smarkets become linked orintegrated with those of othercountries or the rest of theworld. Therefore, in a fullyintegrated market, all forms ofbarriers are eliminated toenable foreign financialinstitutions to participate indomestic markets. This is whyit is argued here that carelessstatements like that ofPresident Zuma should not betolerated. It hampersdevelopment of the SADCregion and Africa byextension. Zuma shouldunderstand that whether acountry, region or continent

our African leadersdemonstrate that Africa as awhole is their place and showlove and respect for oneanother. Whether you are fromMalawi or Nigeria or Ghanaor Somalia or Cameroon orSenegal or Gabon or Kenya,we must look out for thethings that promote theinterest and common good ofone another. Our leaders muststop playing this superiorityand inferiority game thatdivides the continent and byextension transcends down tothe various nationals of thevarious countries. Africansmust learn to leverage oneanother.

such antecedents behaviourslike the one exhibited by JacobZuma, the South AfricanPresident. Indeed, smallerAfrican countries cannotachieve such economic impactby themselves unless they arelinked up through thefinancial markets of theregional economic markets.Malawi should be encouragedto develop further itsinfrastructure within theSADC region and notridiculed.

Zuma should focus more onthe three benefits of financialintegration which are theprimary aim of the RECfinancial integration agenda.These three benefits are (1)Risk sharing – South Africashould share its risk ofexpertise and know-how withMalawi that would boostspecialisation in production.(2) Improved capital allocation– South Africa shouldencourage better allocation ofcapital and support thesmaller and poorer countrieswithin its region to removeimpediments to trading offinancial assets and flow ofcapital. (3) Economic growth– South Africa’s deeperfinancial integration canencourage and stimulatestronger economic growth forits region by making financialresources available foreconomic activities for smallermember countries likeMalawi. Germany did this forparticipating EU membercountries like Greece, Spainand Italy during the recentfinancial crisis that engulfedthe EU.

Tony Navah Okonmah, afinancial and economicanalyst, wrote from London .

“chooses to integrate itsfinancial markets formally orinformally, it needs to createan enabling environment thatwould attract foreignparticipation” and hisstatement on Malawi’sdevelopment processesdoesn’t create an enablingenvironment for the financialintegration of the SADC andAfrica as a continent. It is time

We have seen that whyregional economiccommunities have not beenable to harmonise thestandards and regulations ofgoverning financial marketsand to create a larger centralAfrican financial marketknown as African EconomicCommunity (AEC) that wouldsupport Africa’s regionalintegration agenda is due to

We can’t think likeAfricans generally, weare in Johannesburg,this is Johannesburg, itis not some nationalroad in Malawi

Price of rice goes up, scarcity looms as poorquality floods market

masses directly.It will be recalled that

Vanguard on October 7, 2013did a report on the situation ofrice business in Nigeria. Thereport highlighted the fact thatimporters have stoppedbringing in rice through theNigerian sea ports because ofthe high import tariff regimeand that all brands of rice in theNigerian market are smuggledin through the Nigeria - Beninland borders, even thoughimport through the land routeis officially prohibited. Thereport also predicted that thesituation will result in scarcityof rice during the “Embermonths” as smugglers and localproducers will not be able tocope with demand since rice

has become Nigeria’s moststaple food.

The local production that thetariff was meant to protect is alsoaffected by the smugglersactivities. The gainers are thesmugglers and the Customsofficials who will have to besettled at the various borderpoints If the current tariff is towork, the Customs Departmentmust put a stop to the activitiesof smugglers. This appears tobe a Herculean task for them toperform. If the customs areunable to perform, the landborder should be open to all sothat the government can earn

duties, instead of allowing a fewunscrupulous elements to makea gain from the situation.

In the interim, stakeholderssay that government can reversethe import tariff back to itsprevious position, so thatimporters can start bringing inrice. This will discourage theactivities of the smugglers as itwill not be profitable for themto bring in rice through Benin,as the tariffs will now be almostat par with what obtains at theports.

Way forwardAt present local production is

not strong enough to have any

impact on rice importation, thequantity produced is notsignificant in percentage terms.Mr. Tunji Owoeye, suggestedthat the government shouldform a body of key stake holdershe termed” Chain Drivers.”They are to work together withkey government departments toset a realistic time table for localproduction. There should be amonitoring team to determinethe true position of localproduction and the actualquantity of local rice that isgoing into the markets. WhenVanguard visited the markets inOctober, it did not find any localbrand of rice on display for sale.

It is clear that there is a greatdisparity between what is being

quoted as local production/importation and the reality onground. Right now, the marketis in crisis; how does thecommon man get rice to eat thisDecember? The governmentshould immediately setmachinery in motion to facilitateurgent importation at anencouraging tariff rate toimporters. This will serve as anad-hoc measure for sufficientrice to be available in the marketduring the season. After theseason, the Minister canassemble a committee of allstakeholders in the ricebusiness to fashion out a wayforward.

See page 28

CMYK


Business & Economy

BRIEFS

BY NAOMI UZOR

From left :Chairman, Ikoyi/Obalende Local Council Development Authority (LCDA) AdewaleAdeniji; Executive Director, Risk Management, Fidelity Bank Plc, Onome Olaolu and GeneralManager, Public Sector, Lagos and South West Bank, Tobi Lawal, duringthe official handoverceremony of the Classroom Block (Catering and Tailoring Sections) of the Lagos StateSchool for Vocational Studies, Keffi Street. Ikoyi that was renovated and equipped underthe Fidelity Helping Hands Programme (FHHP) of the bank , recently.

The NigerianAssociation of

Chambers of Commerce,Industry, Mines andAgriculture (NACCIMA),has expressed concernover continued retentionof Monetary Policy Rate(MPR) at 12 percent formore than a year by theCentral bank of Nigeria,CBN, saying that it isunaffordable to borrowers.

Speaking on the state ofthe nation, the NationalPresident of NACCIMA,Alhaji MohammedBadaru Abubakar, saidthat NACCIMAcommended the CentralBank of Nigeria and itsMonetary PolicyCommittee (MPC) fordoing a good job tomaintain monetarystability in the economy.

He stated thatNACCIMA, however,expressed concern overthe continued retention ofits high Monetary PolicyRate (MPR) at 12 percentfor more than a year now.

This, he said has keptthe interest rate high andunaffordable to borrowers.

He said businessoperators should not beallowed to continue tostruggle with that kind oflending rate if they are tothrive and boostproductive capacities andcreate more jobs in thecountry.

“We express concern onthe recent CBN policypronouncement, which

12% MPR unaffordable toborrowers —NACCIMA

drastically increased the CRRon public sector deposits from12 percent to 50 percent andalready threatening stabilityin the financial system as costof doing business isescalating with lending ratesalso soaring since there willbe less money to lend tobusinesses. We therefore,counsel that the CBN shouldreview the CRR on publicsector deposits downward tosay 20 percent or 25 percent,so as to reduce the shock onthe financial system and avertanother round of distress inthe banking sector” he stated.

Abubakar noted that thebusiness community has

continued to be confrontedwith numerous taxes andlevies being demanded by thethree tiers of government, thuscreating untold burden anddistractions for businessoperators.

“We cannot continue toignore the serious negativeimpact of multiplicity of taxesand levies on businesses,hence, counsel that the threetiers of government shouldcontinue to intensify efforts onharmonization of taxes &levies throughout the countryto effectively address thisproblem,” he said.

World Bankpledges$500msupport forFG’s agric.programme

The World Bank said i t w o u l d c o m m i t 5 0 0m i l l i o n d o l l a r s t os u p p o r t t h eAgricultural Transformation

Agenda of the FederalGovernment.

The bank’s Fadama TaskTeam Leader, Dr AbimbolaAdubi, said this in Lokojaduring a visit to Kogi’sDeputy Governor, Mr YomiAwoniyi.

Adubi said the moneywould be spent on theprovision of agricultureinfrastructure, staple cropsprocessing and supplyof improved seeds andseedlings to farmers acrossthe country. He said that theglobal bank will spendadditional 200 milliondollars on the production ofcassava, rice andhorticultural crops.

Adubi said that the WorldBank decided to lend a handof support tot h e t r a n s f o r m a t i o nprogramme after a thoroughassessment by a team ofexperts. He said that theprogramme was capable ofcreating millions of jobs andthe reduce poverty levelamong Nigerians.

The official however, saidthat Kogi State was the onlystate to benefit from thebank’s cassava productionsupport plan.

Adubi said the state beingthe country ’slargest producer of thecrop.

He said that the team was

The Executive Vice-Chairman of the

Nigerian CommunicationsCommission (NCC), DrEugene Juwah, has cautionedtelecom operators againstflouting Mobile NumberPortability (MNP) rules.Juwah gave the warning inLagos at a Telecom Executivesand Regulator ’s Forumorganised by the Associationof TelecommunicationsCompanies of Nigeria(ATCON).

He said that some operatorshad deliberately refused theircustomers the choice ofmigrating to other networks,contrary to the business rule.He said that much time,efforts and energy were spentto put the MNP rules in place,urging telecom service

Operators are flouting porting rules, says NCCproviders to obey them. ‘’Verysoon, the regulator will comeup with its regulatoryintervention by sanctioningthe operators,’’ he warned.Juwah said that subscribersdemanded for MNP and,therefore, should be allowedto port at will.

He added that it would bewrong to conclude that MNPhad not succeeded since somesubscribers had more thanone Subscriber IdentificationModule (SIM) card. Earlier,the Director of CustomerCare, Globacom Nigeria, MsMaria Svensson, noted thatthe MNP exercise had notaffected the Nigerian telecomindustry because mostsubscribers had up to threeSIM cards.

Svensson said that at

present, more than 50,000telecom service users hadported to Globacom. She saidthat one of the challenges ofMNP was that of allowing apost-paid customer to leavea network while still owing.Mr Ibrahim Dikko, theDirector of Legal andRegulatory Affairs, EtisalatNigeria, said that MNP hadgiven subscribers choicesand empowered them to makedecisions.

Dikko said that MNP hadfostered innovation in theindustry as each operatortried to make its servicesexceptional. He, however,said that more awarenessshould created to ensure thesuccess of MNP.

The Executive Director of

AfDB programmeAfDB programmeAfDB programmeAfDB programmeAfDB programmeempowersempowersempowersempowersempowers33,000 groups in33,000 groups in33,000 groups in33,000 groups in33,000 groups infive statesfive statesfive statesfive statesfive states— CoordinatorThe Community-Based

Agricultural and RuralD e v e l o p m e n tProgramme (CBARDP) hassaid that it had empowered33,000 rural women and othervulnerable groups in fivestates. Alhaji Ibrahim Arabi,the Project Coordinator, madethis known in an interviewwith the News Agency ofNigeria (NAN) in Bauchi.

Arabi said that the groupswere trained in various skillsto better their livingconditions.

He explained that theproject was supported by theAfrican Development Bank(AfDB).

According to him, the skillacquisition training is aimedat reducing poverty in therural areas of the participatingstates of Adamawa, Bauchi,Gombe, Kaduna and Kwara.

Arabi explained that thebeneficiaries had been trainedin various skills acquisitionprogrammes from theinception of the programme in2006 to date.

“The beneficiaries were

FG approvesFG approvesFG approvesFG approvesFG approvesN10bn forN10bn forN10bn forN10bn forN10bn forConditional CashConditional CashConditional CashConditional CashConditional CashTTTTTrrrrransfansfansfansfansfer schemeer schemeer schemeer schemeer scheme

The Federal Governmenthas approved N10 billion

to improve the services of theConditional Cash Transfer(CCT) scheme. This iscontained in a statementissued by Mr DesmondUtomwen, the Media andCommunication Consultant tothe Millennium DevelopmentGoals (MDGs) Office in Abuja.

The statement quoted DrPrecious Gbeneol, the SpecialAssistant to the President on(MDGs), as explaining thatthe fund was to improvewomen and children heathcare delivery system. It addedthat the CCT was designed tostimulate demand forhealthcare by women andchildren.

According to the statement,the scheme is being scaled upto 30 states with totalbudgetary provision of N20billion this year. “Efforts arebeing made by initiatingConditional Grants Scheme(CGS) as well as thedeployment of ground-breaking mobile moneytechnology to drive the newscale up of CCT.

CMYK


Business & Economy

BRIEFS

By NKIRUKA NNOROM

The Lagos Stategovernment hascalled on investors

interested in public-privatepartnership to consider thestate for such initiative, asthey are assured of aconducive investment climatethat will deliver competitivereturn on their investments.

The state’s Commissionerfor Finance, Mr. AyodeleGbeleyi, gave the assuranceat a forum in Lagos.

Gbeleyi, who spoke on

LASG woos investors for PPP, promisesconducive operating environment

behalf of the state governor,Raji Babatunde Fashola,assured that the stategovernment would continueto strengthen its institutionalframework to provide bettercoordination and planning ofinfrastructure, greateraccountability for publicinvestment and delivery ofpublic services, as well astransparency in regulationand procurement.

He explained that theOffice of PPP, an organ of thestate executive, has been thedriver of the PPP policy and

is responsible for itsdevelopment and refinementover time, saying, “Asindividual processes developand move further into theimplementation stage, theoffice ensures effectivestakeholder engagement,market interest andmomentum to reach financialclose and the start ofconstruction and/oroperation.”

“The office has alsocontinued to supportministries, departments andagencies to ensure that their

PPP projects are carefullyappraised, scoped andplanned prior to initiating aprocurement process,” headded.

He further stated that thestate government is ready tosupport interested partieswith incentives, adding,however, that the nature ofthe project determines thekind of inventive applicableto it, as incentives differfrom one project to another.

Speaking on the theme ofthe event, “Public PrivatePartnership Innovations inPublic Sector Financing”,Gbeleyi said it wasinstructive due to thedwindling nationalresources and the increasingsocio-economic needs andinfrastructural challenges ofNigeria.

“The situation is evenmore critical in Lagos State,the economic hub andcommercial nerve center ofthe country, which housesabout 2,000industrialcomplexes, 10,000commercial ventures, 22industrial estates, as well asseaport and airports,” hesaid.

He stated all thesecontribute to attract influx ofpeople into the state, sayingthat it puts pressure oninfrastructure needs of thestate.

“In view of this, Public-Private Partnership come asa welcome strategy for thestate government to bridgeits huge infrastructuredeficit, because PPP allowsus to tap into private sectorcapital and leverage on itsmanagerial efficiency,technology, innovation,entrepreneurial approachand expertise,” he stated.

Speaking, Ms. NgoziEdozien, Director, DiamondBank, said that banks havebeen critical to the role ofinfrastructure developmentall over the world, addingthat without engaging withbanks, both states andfederal governments whichare stakeholders ininfrastructure development,will not move quickly interms of infrastructuredevelopment.

“Banks have been at theforefront of nation buildingbecause that is what we aredoing in supporting publicinfrastructure developmentthrough public and privatepartnership projectfinancing. We have alwaysbeen significant in thegrowth of the economy andin Nigeria.

BY NAOMI UZOR

The Lagos Chamber ofCommerce and Industry,

LCCI, has appealed torelevant authorities in thecountry concerned withimportation of consumerproducts to check unbridledimportation of the goods intothe country as themanufacturing enterprises arestill grappling with theinherent problems.

Speaking on the economy,President of LCCI, Mr.Goodie Ibru, said thatNigerian manufacturers arestill struggling with theproblem of unbridledimportation of consumerproducts into the country, andthat, generally, these productsare cheaper and sometimessub-standard.

“This has been creatingsustainability challenges formanufacturing enterprises in

LCCI decries unbridled importation ofconsumer goods

the economy. We once againappeal to the authoritiesconcerned to address thisconcern in order to createroom for the survival ofdomestic industries. Similarly,livestock farmers are full oflamentation over the brazenand overwhelming presenceof smuggled poultry productsfrom the neighbouringcountries. These importedpoultry products have amarket share of more than 70percent. All these createproblems for the domesticproducers and limit theircapacity to create jobs” hesaid.

He lamented the highunemployment rate inNigeria, saying that it iscurrently one of the highestin the world, at 24 percent.

“The rate of unemploymentin the Nigerian economy iscurrently one of the highestin the world, at 24 percent.

Over 50 percent of the youthsin the urban areas areunemployed. It is a verydisheartening situation forparents who had labouredand strained to invest in theeducation of these youths.The state of affairs hasassumed the dimension of aneconomic and social crisis.There is a relationshipbetween rising criminalityand unemployment,” he said.

Ibru said there is need to dosomething urgently to createjobs, and that the chamberproposes that there should beincreased support for SMEsand business start-up throughcapacity building andfunding, encouragement ofdomestication of private andpublic sector spending inorder to boost the multipliereffect of domestic spending onthe economy, promotion ofsectoral linkages in theeconomy so that all sectors

Europe bansEurope bansEurope bansEurope bansEurope bansSouth AfricanSouth AfricanSouth AfricanSouth AfricanSouth Africancitrus imcitrus imcitrus imcitrus imcitrus imporporporporportststststsover diseaseover diseaseover diseaseover diseaseover diseasefearsfearsfearsfearsfearsThe EU has

banned most imports ofSouth African citrus for theremainder of this year overfears that a fungal diseasefound in dozens of shipmentscould spread to the 28-nationbloc.

The ban follows theinterception of 36 citrusconsignments this year fromthe EU chief ’s summersupplier that werecontaminated with the fungalblack spot disease, which isnot currently found in Europe.

Earlier this month, Reutersreported that the EuropeanCommission was set topropose the ban, followingpressure from citrus growersin southern Europe.

“The introduction of citrusblack spot into the EUterritory will pose a seriousthreat to the EU citrus-producing areas.

“For that reason, it isnecessary to further restrictthe import of citrus fruit fromSouth Africa,” theCommission said in astatement confirming themove.

The ban will apply to allSouth African citrusshipments from regionswhere the disease is present,which covers the bulk of thecountry’s production.

Initially, the ban will applyonly to the 2012 to 2013harvest, which ended inOctober.

FG pledgesFG pledgesFG pledgesFG pledgesFG pledgestransparency intransparency intransparency intransparency intransparency inmarginal oilmarginal oilmarginal oilmarginal oilmarginal oilfields licensingfields licensingfields licensingfields licensingfields licensingThe Federal Government

has pledged to ensuretransparency in the second oilmarginal fields licensing forthe upstream sector of the oiland gas industry. TheMinister of PetroleumResources, Mrs DiezaniAlison-Madueke, made thepledge on Thursday in Abujaat the inauguration of thesecond oil marginal fieldslicensing.

“Today, we are here to flagoff the second marginal fieldlicensing round, “Over thenext two weeks, theDepartment of PetroleumResources will undertake aroad show to different parts ofthe country about theprogramme. “This will befollowed by three and halfmonths of competitive biddingprocess, in line with theFederal Government’scommitment to openness andtransparency in the conduct ofbusiness activities in thecountry,” she said.

From left: Head, Lisbulk Nigeria Ltd, Mr. Ganiyu Owolawi; Managing Director, Osun StateInvestment Company, Mr Bola Oyebamiji; Regional Sales Manager, Nestle Nigeria Ltd, MrAdewunmi Adejumo and Field Manager, Nestle Nigeria Ltd, Mr Oluseye Agboola, duringthe presentation of a Pick- Up van to Osun State Investment Company as the 2013 Most Out-standing Distributor in Oshogbo, Osun State, recently.


Banking & Finance

BRIEFBy BABAJIDEKOMOLAFE

Bloomberg TV Africa, apartnership between

Bloomberg Television, aleading supplier of global

business and financial newsvideo content and OptimaMedia Group (OMG), aLagos-based mediacompany, has launched twonew business programmesand also announced thelaunch of a further twoprogrammes which will airfrom early 2014 onBloomberg Television onDStv channel 411.

Africa Business Weeklyreviews the most importantbusiness, economic andpolitical stories and theirimpact across the continent.Presented by BoasonOmofaye and UcheOkoronkwo from Lagos andLondon and Eleni Giokosfrom Johannesburg, they arejoined by leading experts toanalyse the markets, debatethe African agenda anddiscuss key investments,governance and economiccommitments.

From left: Mr Yemi Adeola,Managing Director/Chief Executive Officer Sterling Bank PlcAnd Mallam Sanusi Lamido Sanusi,Central Bank Of Nigeria Governor and Dr SuleimanAdegunwa Chairman Sterling Bank Plc .At the Launch Of Financial Inclusion Scheme BySterling Bank Plc Held at Asejere Market Makoko Yaba Lagos. PHOTO- AKEEM SALAU

Banks move to checkmateactivities of e - fraudsters•Fortify security oninternet platforms

Banks havecommenced moves

to protect their customersfrom the rising wave ofelectronic fraudsters byfortifying their internetplatforms with additionalsecurity features.

In recent times e-fraudsters have beenbombarding bankcustomers with scam mailswith a view to deceptivelyacquire their personalidentification number(PIN). The impact of thesemails is reflected in reportof the Anti fraud Portal ofthe Nigeria InterbankSettlement System(NIBSS) which revealedthat Web and ATM Fraudrepresent the highestfraud occurrence duringthe periods under review.

Vanguard investigationrevealed that for theperiod September 13 toOctober 13, the number ofreported cases of frauddeclined from about 140 to110. During the period,Web fraud accounted forabout 40, while ATMfraud accounted for about20. E-commerce andinternet banking fraudaccounted for about 20together.

In an apparent move toprotect their internetbanking platforms andcustomers from electronicfraudsters, two of thebiggest banks in Nigeria,FirstBank and GuarantyTrust Bank, last weekupgraded their internetbanking platforms,fortified with additionalsecurity features.

Announcing theupgrade of its FirstOnline internet platform,FirstBank said, “Theupgraded platform nowcomes with enhancedsecurity features, withmultiple level securityauthentications such astwo page login,personalized true stamppage, intelligent questionand token authenticationto protect customers fromonline fraudsters.According to the Head,Marketing and CorporateCommunications, Mrs.Folake Ani-Mumuney,’the new FirstBank onlinebanking platform,FirstOnline offers amongothers unique securityinterface that enables userto create a true stamppage identity which isexclusive to thecustomer ’s login pageand ensures thatcustomers are only guidedto the authentic personallogin page for their

transactions with uniquetoken pin as final transactionauthentication.

Similarly, GTBank said itsupgraded Internet Bankingplatform, “also offerscustomers an accountinformation reporting servicevia its new homepagedashboard as well as an

enhanced security featurewith its improved loginkeypad functionality ”.Speaking on thedevelopment, Sina Ayegbusi,Head of Guaranty Trust Bankplc’s Technology Divisionstated that the Bank’scommitment to superiorcustomer service experience

drives it to ensure that itutilizes revolutionarytechnology to simplify andsecure the online bankingtransaction and experience ofits customers. He furtherstated: “The upgrade to ourInternet Banking platformgives our diverse costumersvarious on-the-go bankingoptions due to its responsivedesign that makes itconvenient for use oncomputer and mobiledevices”.

Committee of E-Banking Industry

Heads (CeBIH) haspledged its support for thefinancial inclusion efforts ofthe Central Bank of Nigeria(CBN).

CeBIH Chairman, Mr.Chuks Iku made this pledgeat the 3rd annualconference of the Committeein Uyo, Akwa Ibom State.

Chuks said the purpose ofthe conference among otherthings, was for e-paymentstakeholders to learn newmethods and strategies ofpursuing the objectives ofNigerian National FinancialInclusion (NFIS), which isto reduce the number ofadults excluded from accessto financial services from46.3 per cent to 20 per cent.

The objectives of CeBIH,he said, is to promote

CeBIH pledges support for CBN’sfinancial inclusion efforts

electronic banking andelectronic payment services inline with global best practiceswhile promoting the adoptionand usage of electronicchannels in a way that willbring about financialinclusion of the unbankedand under-banked in linewith the payment vision 2020.

He said the theme of theconference, EpaymentSystems: Harnessingopportunities for growth andprofitability, was informed bythe need for banks and otherstakeholders to seek for waysto grow the use of electronicchannels in a sustainable way.

CeBIH, he said,“ recognises the role ofCentral Bank of Nigeria asour regulator and also that ofNIBSS. What we want is thatthe CBN should engagestakeholders on a more

regular basis on its financialinclusion initiatives.

Commenting on the themeof the conference, ChristabelOnyejekwe, ExecutiveDirector, Nigeria Inter-BankSettlement System Plc, notedwhile there are opportunitiesfor growth and profitability inthe epayment industry,increased collaboration isrequired to harness theseopportunities. She said, “Inthe financial sector we havenot rested on our oars, wehave always risen to thechallenge of harnessinggrowth and opportunities,even when it seemsimpossible. As an industry wedare to say we havecontributed to building thenation, and we wouldcontinue to be a criticalcontributor to the GDP goingforward.

EngageEngageEngageEngageEngageprofessionals toprofessionals toprofessionals toprofessionals toprofessionals toavoid buildingavoid buildingavoid buildingavoid buildingavoid buildingcollapse-NIAcollapse-NIAcollapse-NIAcollapse-NIAcollapse-NIANigerians should

engage professionalsin design and execution ofbuilding projects so as toavoid the recurring problemof building collapse.

The Rivers State Chairmanof Nigerian Institute ofArchitects (NIA), Arc.Emmanuel Dike made thiscall in Port Harcourt duringthe inauguration of the PortHarcourt Office of RifengPiping Systems also, addingthat the company’s pipes arethe solutions to the plumbingchallenges Nigerians arefacing.

The Rivers NIA Boss alsourged Nigerians to allowprofessionals to handle theirbuildings by first of all lettingan architect design thestructures to avoid theircollapse.”

Dike also said that “Wearchitects believe that rifengpipes protects buildingbecause the pipe does notleak or not rust.”

He further called onRifeng Piping Systems tosponsor trainingprogrammes for plumbersnoting that “by the time youtrain plumbers, they will bethe ones to market the rifengpipes.”

BloomberBloomberBloomberBloomberBloomberg Tg Tg Tg Tg T VVVVVAfrica launchesAfrica launchesAfrica launchesAfrica launchesAfrica launchesbusinessbusinessbusinessbusinessbusinessprogrammes onprogrammes onprogrammes onprogrammes onprogrammes onD S t vD S t vD S t vD S t vD S t v



Corporate Finance

BRIEFS

Dr. Ngozi Okonjo-Iweala, Co-ordinating Minister for the Economy andMinister of Finance

How FBN Capital drivesNigeria’s competitivenesson global scene

BY PETER EGWUATU

Nigeria is becomingthe centre of

attraction by foreigninvestors in spite of thechallenges facing thecountry. This shows that thecountry’s potentials areenormous and needed tobe tapped and harnessedfor economic growth anddevelopment; and thatshows why investors fromaround the globe arelooking for avenues toinvest in the country andAfrica as a whole.

It should be noted that inrecent time, countries inthe world have soughtlong-term solutions to theireconomic and developmentchallenges, especially thefactors hindering theirgrowth, development andcapacity to compete withtheir counterparts on aglobal platform.

With countries graduallyrecovering from the globaleconomic crisis, theconsensus amongsteconomists including theIMF is that the globaleconomy will witnessstronger growth in 2014 at3.6 percent. For 2013, theestimate remains subduedat 2.8 percent. However,global growth is expectedto increase in 2014.

The IMF expects averagegrowth in Sub-SaharanAfrica (SSA) to spike in2014 (especially in Nigeria,Cote d’Ivoire,Mozambique) by onepercent from five percent tosix percent. The majorfactors underlying growthare strong domesticdemand and privateconsumption, associatedwith investment ininfrastructure, exportcapacity and higher globalgrowth. With Nigeria’sGross Dometic Product ,GDP accounting for 20percent of SSA’s GDP(according to IMF) thenation’s economicsignificance cannot be overemphasized.

To put Nigeria onfavourable, competitivefooting as global andregional growth is expectedto increase in 2014, FBNCapital, the investmentbanking and assetmanagement arm of FBNHoldings Plc, centred its2013 edition of its annualinvestor conference on theaddressing the challengesof growing the economyand measures required toenhance the nation’scompetitiveness in theglobal market.

Kayode Akinkugbe,Managing Director, FBNCapital, said the companywas delighted at the

outcome of the conference,especially the resolve by thepublic and private sector toseek more areas ofpartnerships to acceleratenational economic growth anddevelopment.

“The conference identifiedkey areas of focus that requiresimmediate attention to ensurewe grow our economy alongthe lines of severalprojections. We are quiteconfident that conversationsheld during the conferencewill inspire the adoption ofreforms and policies that willyield tangible results,” he said.

The 2013 FBN Capitalinvestor conference also sawseveral presentations thathighlighted the challenges ofgrowing the economy whilstpursuing fiscal restraints,measures taken to enhance thenation’s competitive edgeamong its counterparts andframework with which toproject the nation’sdevelopment from a frontier toa growth market.

Addressing the conferencevia pre-recorded videointerview, Dr. Ngozi Okonjo-Iweala, Co-ordinatingMinister for the Economy andMinister of Finance said oneof the government’s keyobjectives was to ensureNigeria’s growth issustainable, with the capacityto create jobs.

According to her, therebasing of the nation’s GDPand fast growth are two factorsneeded for Nigeria to be the

largest growing economy inAfrica. “Nigeria is already seenas a hub. Our banks are presentin almost all West Africancountries and government isworking on developingvarying sectors of the economy,especially for the purpose ofcreating jobs. We muststrengthen sectorialdevelopment, but at the end,we don’t just need growth forgrowth, but we need growth,to deliver,”

Olusegun Aganga, Ministerof Trade and Investment,saidwith the on-going recordedgrowth, Nigeria will emergethe 13th largest economy in theworld by 2050, quoting aPriceWaterHouseCoopers(PWC) report. “Nigeria is the10th largest producer of crudeoil globally with 37 billion ofproven revenue, and has the11th largest oil reserves in theworld. It has a large market anda strong workforce. Also, thenation is well placed to explorethe potentials offered byECOWAS and it is one of thefastest growing markets in theworld, with diverse pool ofresources to further fuel itsgrowth. With a debt to GDP of20 per cent, Nigeria has largefiscal space to operate in,” hesaid.

He said the government hasstarted an extensive reformoriented transformation processwhich cut across theagricultural, power, fiscal,industrial banking and the oiland gas sectors, among others.He said the hunter report rated

Nigeria the number onedestination of investment in thewhole of Africa for the secondyear running.

“To enhance our position, theadministration is focussing onreforms. The FederalGovernment has started anextensive reforms, orientedtransformation process whichcut across key sectors:Agricultural, power, industrial,banking, oil and gas, amongothers.

He said it is essential thenation focuses on areas wherewe need to be competitive inorder to attract the venturecapital private sector players sothat we can acquire affordablefinance for the economy togrow.

Also at the conference, FBNCapital analysts predicted amodest multiple expansion inequities in Nigeria in 2014,along with a host of othereconomic forecasts. Whilegiving the firm’s 2014 outlookon equity/fixed income views,Olubunmi Asaolu, Head,Equity Research, FBN Capital,said “A modest multipleexpansion is expected onequities and banks and thecement industries are slightlyfavoured over consumer goods.

To our minds, consumergoods have expended themarket’s goodwill”. Theprediction, which is expectingto see more investment in thenation’s equities, is in line withNigeria’s present position asan attractive hub forinvestment.

DangoteDangoteDangoteDangoteDangoterecords highestrecords highestrecords highestrecords highestrecords highestdividenddividenddividenddividenddividendgrowth ingrowth ingrowth ingrowth ingrowth incapital marketcapital marketcapital marketcapital marketcapital market

The Dangote brand hasbeen declared as the

company with the highestdividend growth in theNigerian capital market.

The company also won thehighest profit margin ratioaward in the recent PearlAward for Market ExcellenceCategory for companiesquoted on the stock market.

Aside emerging as the“Pearl of the Nigerian StockExchange”, the company alsowon awards in three othercategories, in the 2013edition. Leading the pack ofother brands, DangoteCement was adjudged by theboard of governors of thePearl Award Nigeria as thewinner in the Industrialgoods, Sectorial Leadershipaward and BuildingMaterials category.

The President of the Pearlaward Board of Governors,Tayo Orekoya lauded theManagement of DangoteCement for awards won andenjoined the company to keepthe company’s flag flying.“We are very proud to beassociated with DangoteCement and with DangoteGroup generally. For thesecond year running,Dangote Cement is winningthe Pearl overall award,emerging as the PEARL of theNigerian Stock Exchange.

Lafarge to sellLafarge to sellLafarge to sellLafarge to sellLafarge to sellexcess electricityexcess electricityexcess electricityexcess electricityexcess electricityto boost Nigeria’sto boost Nigeria’sto boost Nigeria’sto boost Nigeria’sto boost Nigeria’soutputoutputoutputoutputoutput

Lafarge Cement WAPCONigeria Plc (WAPCO),

plans to sell about 40megawatts of excess electricityto help ease power shortagesin Nigeria.

The company, 60 percentowned by Paris-based LafargeSA (LG), uses only 40 to 50megawatts out of 90megawatts generated by itslocal power plant, MichaelAwanayah, the company’sgeneral manager of businesstransformation, said recentlyat the West African PowerIndustry Convention in Lagos,the commercial capital. “Weare looking to be one of thefirst manufacturers to sellpower and help reduce thepower shortage,” he said


Corporate Finance

BRIEF

Triple Gee & Company Plchas announced readiness

to improve its earning for thebenefit of all stakeholdersthrough diversification of itsproduct lines.

Addressing shareholders atthe 23rd Annual GeneralMeeting, AGM, in Lagos theChairman, Sam IdowuAyininuola, said that thecompany is consolidating itscore business by theintroduction of innovativevalue added products andservices.

He listed some of theproducts and services toinclude securing of certificateswith the certidoc, productionof recharge vouchers and PINmailer.

Ayininuola noted that theground work for thediversification has been laid,adding that the company isalready sourcing for neededcapital to actualise the plan.

“You can be rest assured thatwe are doing all it takes to getthe best interest rates to avoidjeopardizing the future of ourbeloved company,” heassured.

He said that inspite of thepersisting global and nationaleconomic challenges thecompany faced in 20123, it didnot fare badly.

Speaking on the operatingenvironment for the year, hesaid, “You will agree with methat during the period underreview, the global economyhas faced many challenges. Inrecent times, the United Stateof America, which is thelargest economy in the world,has not been able to pay itsdebts because of its inabilityraise debt ceiling.

“In the words of economist,some of whom see it as cliché,when America sneezes, theworld catches cold. The

Tripple Gee to leverage productdiversification to grow earnings

By NKIRUKA NNOROM turbulence in the Americaneconomy has caused someripples in the global financialsystem.

“Cliché or not, it is importantto note that Nigeria, as part ofthe international communityand a player in globalbusiness, has not been left outof the effects of the upheavalsin the world economy, whichhas been on for some years.

As a matter of fact, no countryis insulated from the globalchallenges we now face.”

For the year under review,the company recorded 62percent growth in turnoverfrom N619.812 million toN1.003 billion in 2013. Theore-tax profit was N26.90million from a deficit of N8.91million in the previous year,representing 202 percent

increase. The profit after taxalso increased by 202percent from N6.234million in 2012 to N18.83million in the year underreview. Earning per sharerose by 202 percent fromN1.26 to N3.80. However,a 2kobo per share dividendwas approved byshareholders at themeeting.

Kakawa GuaranteedIncome Fund, an open

ended unit trust schemeapproved by the Securities andExchange Commission, SEC, isset to reward its unitholderswith additional N52.14 million,representing 35 percent of itsnet income in accordance withthe provisions of the TrustDeed.

Kakawa Fund to reward unitholderswith N52.14m

By WILLIAM JIMOH The fund made a net incomeof N 148.98 million afterdeduction of guaranteedliabilities and other expenses,which placed it profitablyabove its projections for 2012financial year.

Chairman, Board of Directorsof the Fund, Mr. LaoyeJaiyeola, stated this during thecompany ’s 2012 AnnualGeneral Meeting, AGM, heldin Lagos. He explained thatin 2012, the fund stayed within

the prescribed assetallocation of a minimum of 75percent fixed incomesecurities and maximum of25 percent equities.According to him, “As atDecember 31, 2012, the NetAsset Value, NAV, of thefund was N3.19 million with2,308 unitholders having3,162, 830,000 units. Despitethe unstable interest rateregime and the highlyvolatile nature of the capitalmarket in the year 2012, thefund met its obligations ofguaranteed returns tosubscribers as well as capitalpreservation.

On the fund outlook for2013, he said; “We expect thatthe year 2013 will not bedifferent from the previousyears. Following theavoidance of the ‘Fiscal Cliff’in the United States,uncertainties surroundingthe Euro Area are expectedto set the pace for theperformance of economiesaround the world in 2013.Developing countries thatthrive mostly on exports areexpected to feel the heat asforeign demand continues towobble.

The Head, Mass Market Segment ofDiamond Bank Plc, Mr. Osita Ede, has

commended the Central Bank of Nigeria(CBN)’s financial inclusion initiative, sayingthat it has started reducing the level ofunbanked population in the country.

Ede made the remark during the DiamondBank SavingsXtra season six draw atOjuelegba, Lagos State where N12.750million was given out to 21 customers thatemerged in various categories of the promo,including a salary for life package.

He specifically applauded the apex bankfor coming yup with a policy that allows banksto open account for customers that do not haveany means of identification.

CBN’s financial inclusion yielding result — EdeHe said, “The people that have not being

able to open account could be because ofignorance or non-possession of Identity cardsand other documentation required. Now, CBNhas come up with a policy where they havethree categories of savings account customers.Customers, who do not have means ofidentification, can still open an account, butthey will some restriction placed on theiraccounts.” Meanwhile, 10 winners emergedin the targeted draw with five clinchingN100,000 each, while another five took homeN50,000 each. Also 10 customers won N1million each in the monthly draw; onecustomer won N2milion, while anotheremerged salary for life winner, whereN100,000 will be paid monthly to the luckywinner over the next 20 years.

The Scientific ProductsAssociation of Nigeria

(SPAN) said it will work withthe Federal Government tostop dumping of sub-standardscientific products into thecountry.

The President of SPAN, Mr.Gbolade Famoriyo, whodisclosed this to newsmen,weekend in Lagos, ahead ofthe association’s planned Lab& Scientific Nigeria Expo2013 scheduled to hold from3rd -5th November at EkoHotel, Lagos said, “We areworking towards enforcementand regulation of importationof scientific products in orderto prevent Nigeria becominga dumping ground forsubstandard products.”

He further stated thatNigeria has the capacity toproduce some of the scientificand engineering products,stressing that high cost ofproduction in the country hasimpeded their effort and thusmade them uncompetitive.

According to him,“Electricity supply is key toany production. So, if there isconstant supply, it will helpreduce the cost of productionin Nigeria. I believe Nigeriacan be better than China whenthere is regular supply ofpower. Members of SPAN arewilling to manufacture in thecountry but the high cost ofproduction has preventedthem from doing so, hence wenow rely on sub-standardproducts which is not good forour country. So, if we mustimport, then we shouldimport standard product andthat is why we are makingeffort to work with the FederalGovernment to come out witha framework for importingscientific and engineeringproducts.”

While commenting on theassociation’s proposed Expo2013 in collaboration with theFederal Ministry of Economicand Technology, Famoriyosaid, “New business platform of the analytical andlab equipment from Germanywill open its doors in Lags as14 German manufacturers ofanalytical and lab equipmentwill show their products at anexclusive trade show andcongress.” According to him,“All interested professionalsare invited to visit the showfree of charge.

SPAN to workwith FG toprevent dumpingof scientificproduct

By PETER EGWUATU

By NKIRUKA NNOROM

L-R:Permanent Secretary, Ministry of Health, Lagos State Dr Femi Olugbile; ManagingDirector, IVF Zech International, Prof Nikolas Zech; Managing Director, Pathcare, Dr PamelaAjayi and founder, the Bridge Clinic, Dr Richardson Ajayi durin the inauguration of theclinic in Lagos. recently.

CMYK

26 —Vanguard, MONDAY, DECEMBER 2, 2013

Banking & Finance

got to diversify theirrevenue base. That’swhat most of them,particularly Zenith, aredoing.”

He adds that since thebank was established, ithas invested intechnology to improvecustomer service,something that hasenabled it to grow itsdeposit base faster thanmost rivals. “We’vealways known we needstrong technology to backup customer service,” hesays. “We will continue todo that.”

Zenith Bank named bank of the yearNigeria by the Banker

By OMOH GABRIEL,Business Editor

Zenith Bank PLChas been named

bank of the Year Nigeriaby the Banker, apublication of FinancialTimes of London. In astatement on its websitethe Banker said “Zenithhas come a long way sinceit was founded in 1990.

The bank, which had$17bn of assets at the endof 2012, is the largest inNigeria based on Tier 1capital, according to TheBanker’s latest Top 1000rankings. By the samemeasure, it is the sixthbiggest lender in thewhole of Africa.

“Zenith’s performancein the past two years hasbeen particularly strong.One of the banks to comethrough Nigeria’s 2009financial crisis relativelyunscathed, it made arecord pre-tax profit in2012 of N102 billion($651m). This year lookseven better. It postedprofits before tax of N83billion for the first ninemonths, up 10.4 per cent

year on year. Analystsforecast it to earn aboutN106bn for the full year,which would amount to areturn on average equityof close to 20 per cent.

“Zenith’s results for2013 are all the moreimpressive given theheadwinds that Nigerianbanks have facedrecently. They have hadto contend with fallinginterest rates on

government bonds, atleast in the first half of theyear, and an increase inthe levy they pay toAMCON, a bad bank setup by the governmentamid the financial crisis.Zenith has managed toovercome these bymaking plenty of effort toexpand its loan book. Ithas also been growing itsnon-interest revenues.“[This year] will be alittle bit difficult for thebanks,” says GodwinEmefiele, the bank’smanaging director.

“But it will still be agood year. Banks have

NDIC voted mostoutstandingpublic institution

The Nigeria DepositI n s u r a n c e

Corporation (NDIC) hasemerged as the mostoutstanding publicinstitution in the Finance,Trade and Investmentcategory of the 2012/2013Service Delivery Awardsfor public institutions inNigeria.

A civil society coalition,the Independent ServiceDelivery MonitoringGroup (ISDMG) whichorganised the deliveryservice awards presenteda trophy to theCorporation for toppingthe Finance, Trade andInvestment category aftera rigorous exercise thatinvolved public opinionand technical assessmenton 300 public institutionsby over five millionNigerians who votedthrough mobile SMS,internet andquestionnaire survey.

Presenting the award tothe Managing Director/Chief Executive of NDIC,who was represented bythe Corporation’s BoardSecretary/Director, LegalDepartment, Mr. AlheriBulus Nyako at the 2012/2013 service deliveryawards in Abuja, theExecutive Director,Independent ServiceDelivery MonitoringGroup (ISDMG), Dr.Chima Amadi said theNDIC came top owing toits unequalled ratings byrespondents in the coreareas of assessment ofpublic institutions. Helisted the areas astransparency and fiscaldiscipline, budgetimplementation, promptresponse to enquiries,contributions to theeconomy, sustainable andpeople orientedprogrammes and webvisibility of the publicinstitutions.

CMYK


Commodity Index E-Commerce

Stories BY JONAHNWOKPOKU

Out of the 140 millionNigerians who usemobile phones, only anapproximately 12.7million use dataconnected phones,meaning that over 90per cent of Nigeriansstill use feature phones,said Robert Bole,Director of Innovation,Broadcasting Board ofDirectors, Voice ofAmerica.

Bole stated this whilespeaking on mobileopportunities for Africaat the inaugural editionof the Nigerian AppsSummit held in Lagosrecently.

He said that, “A mobileopportunity that notonly exists for Africa butthe rest of the world ishow services willconnect from lowbandwidth populationsto high bandwidthservices. In Nigeria,there are approximately12.7 million dataconnected phones out oftotal subscription of140million. This impliesthat more than 90 percent of Nigerians arestill on feature phones,”he said.

“But we have toacknowledge the factthat feature phones thatare still coming into themarket today are not thephones of yesterday.They run java scriptsthat allow for users tointerface with socialmedia, browse basic webpages and get activecontent feeds. And thereare companies startingto focus on that market,”he added.

90% Nigerians still onfeature phones — Bole

He explained that,“Successes like 2go,Whatsapp and evenNigeria’s own Paga arevery promising starts. Ithink the realopportunities are notjust building services forthis feature phones butalso extending highbandwidth services tothese phones. Thesophistication oftechnology platformslike Twitter is enablingnew opportunities toextend high customer

interaction to non-datacustomers.

“Even though 3G and4G networks areadvancing quicklyacross Africanlandscape, there willstill be millions andmillions left out of thisprogress. There is adivide today and itwould only becomemore apparent, so whenyou start to grow newcompanies start todevelop features thatwill enable majority ofthe audience to own

O n l i n e

m a r k e t p l a c e ,Kaymu.com.ng saidthat all listings throughthe platform fromDecember 22ndto 31st,2013 would attract nocharges.

Kaymu who disclosedthis in a statement madeavailable to Vanguardsaid the gesture was away of fosteringentrepreneurship in thecountry.

Speaking on the offer,the Managing Directorof Kaymu,Massimiliano Spalazzisaid thatentrepreneurship is anintegral factor in thegrowth of any nationand that kaymu.com.ngrecognizes the drive ofthe Nigerian youths andhas provided a safeonline platform toconduct business.

He said, “As a way off o s t e r i n ge n t r e p r e n e u r s h i p ,Kaymu has putprocesses in place on itsplatform to ensuresmooth and profitabletrading. One of such

Kaymu introduces free listingperiod to boost entrepreneurship

moves is theintroduction of theKaymu Safe Pay whichworks as an Escrowservice by allowingbuyers pay directly intoKaymu’s secure accountand transferring themoney to the seller onlywhen buyer is satisfied.

A more recent move isthe introduction of thezero commission monthwhich runs from the22nd of December tillthe end of the year.”

He added that, “Beingan organization drivenby the satisfaction ofboth buyers and sellersand one thatunderstands the value ofentrepreneurship, thezero commission monthwas put into place tocontinually encouragesellers by allowing themlist products withoutcommission during thisperiod,” noting that,“This is in line with thecompany’s commitmentto empower youths andsmall and medium scalebusiness owners as wellas facilitating thedevelopment of theeconomy.”

Cross section of students of Carol School Nursery And Primary School, Agid-ingbi Ikeja Lagos. during Macleans Milk Teeth School Activation

Nov 22 - Nov 28, 2013

CMYK


Cover Story

Rice import policy

The policy of the Federalgovernment is noble and

desirable. Any country that isforward looking, will want topursue that route. TheMinister of Agriculture is clearin his vision to grow ricelocally, as we have more than60 percent arable land inNigeria. Government felt thatwe should discourage importand encourage our local riceproduction. The governmentdid not take intoconsideration, the harm thatsmugglers will unleash onthis noble policy. Now, theimporters are put on holdbecause they cannot competewith the prices of smuggledrice, neither could the farmersand processors.

Efforts to make the policywork

The Government didencourage the farmers bygiving them fertilisers. Thisgesture has produced themodest result of raisingcommercial rice productionfrom zero level to the state itis now. Apart from fertilisers,the government was willing toget the millers to buy ricepaddy from them. Paddy riceis raw rice that has not beenprocessed.

RIMIDAN (Rice MillersImporters association ofNigeria) as a body donated150(One hundred and fifty)patrol vehicles to the Customsto assist in policing theborders.

Why the policyFirst, the Government did

not collaborate effectively withthe real stakeholders in the ricebusiness.

Second is the damagingeffect of duty differencesbetween Nigeria andneighbouring West Africancountries. Nigeria’s duty is110 per cent, whereas that ofBenin and Camerounremained at 30 per cent.People who do not have theinterest of the country at heartmoved their businesses toCotonou and Cameroun.Although not directly involvedin smuggling, their actionfacilitated the smugglersactivities.

The cost of smuggledpolished rice at N6, 000 ischeaper than N6, 500 paddiesthat the farmers sell to millers.The farmers needed to makesome margins to cover the costof clearing and maintainingthe land.

The process of riceproduction is as follows;Farmer plants rice andproduce paddy (Raw) rice.The farmer sells the paddy riceto the processors who turn therice into finished products.The Processors are no longerbuying paddy from thefarmers because the price isnot attractive for business. As

Mr. Tunji Owoeye(FCA) is theNational Chairman

Rice Millers Association ofNigeria (RIMIDAN). He hasbeen involved in thecommodities business forover 25years. He also holdsother strategic positions inthe Nigerian Agro-Alliedindustry; former Chairman,Board of TrusteesAssociation of CashewImporters/Exporters. He isthe current ChairmanAgric Import Associationof Nigeria and the MD/CEO of Elephant Group ofcompanies with offices inSenegal, Cameroun,Ghana and Cote d Ivoire.In this interview, he positedthat phased importsubstitution is the lastingsolution to the challengesfacing the rice industry in thecountry. Excerpts:

a result, the farmers arethreatening to stop producing.

Government involvement

At this point, thegovernment was

informed of the situation. TheGovernment has seen thatthere is disconnect and theyare trying to fix it. In the lastthree weeks, there have beensome attempts at reducingsmuggling activities but howlong this will last? We do not,

,know.

As we talk now, Cotonou portis awaiting to discharge halfa million tons of rice. This yearabout 1.5million tons of par-boiled rice has beendischarged in Benin allheading for the Nigeriamarket through land routesthat are supposed to bebanned. While the Beninimporter is getting wealthier,

his Nigerian counterpartis closing shop.

How to address the problemGovernment should

introduce a Phased –Import-Substitution- Policy. Theyshould begin by inviting theDrivers of The Value Chain inthe rice business: FarmersAssociation, Processors/Millers and the Importers/Marketers associations.Added to this will be,representatives of the

Ministry of Agriculture,Finance and Central Bank ofNigeria; the Customs andPolice. We call the body RiceDevelopment Council. Itsobjective will be to make surethat Nigeria is self sufficientin rice production within areasonable time limit. TheGovernment should includethese three value chaindrivers in their planning.

How they will deliverFarmers: The government

gives farmers fertilisers andasked them to produce Xquantity. Both parties willagree on targets. Those whomeet target will be givenfurther incentives, while thosewho fail will have to work moreto earn incentives.

Processors: Look at theircapacities, task themaccording to their capacities.

Importers: The remainingcapacity, you give to importers.Give a time frame to thisarrangement.

There must be a monitoringunit to ensure that all partieswork towards the plannedoutcome. This is the only waythe industry can grow.Depending on foreigners tosort out our agric challengeswill not work.

How prepared isRIMIDAN?

As long as we are factoredin, we will go all the way. Theimporters have the largestcapacity and have access tofunding. We are ready toinvest in all the levels of thechain; Farmers, Processorsand encourage the people inthe market. We are ready toencourage local productionand take over the mills from

the Minister but thegovernment must be ready toagree with the importsubstitution strategy we put inplace. The marketers andimporters are the ones thatown the business; they mustbe encouraged to make surethat the backward integrationintention of the government isachieved.

Government losing revenue

Local production presentlyis less than one million

tons. The market requirementis over 5 million tons. Thedifference presently is takenup by smugglers, while thegovernment is recording zerorevenue at the borders.

This body should have thebacking of the government todivulge/expose economicsaboteurs in the sector andgovernment must be ready todeal with these saboteursdecisively. For smugglers to behaving their way some peoplemust be giving them backing.

CustomsThe top hierarchy in the

customs command is seriousabout checking smugglersactivities but they needempowerment in the areas ofequipment and manpower. Anumber of customs officialshave lost their lives in recenttimes in the hands ofdesperate smugglers.

The Import SubstitutionPolicy will work when thegovernment considers theinput of the Value ChainDrivers - The real stakeholders.

•Tunji Owoeye

Nigeria’s duty is 110 per cent,whereas that of Benin andCameroun remained at 30 percent, people who do not have theinterest of the country at heartmoved their businesses toCotonou and Cameroun

CMY


CMYK


Interview

Innoson plans mechanic schools toInnoson plans mechanic schools toInnoson plans mechanic schools toInnoson plans mechanic schools toInnoson plans mechanic schools tosupporsupporsupporsupporsupport FG’s skills acquistiont FG’s skills acquistiont FG’s skills acquistiont FG’s skills acquistiont FG’s skills acquistion— Innoson Motors boss

His passion is to returnNigeria to the good old

days when Nigerians dreamtof what brand of new car todrive. He detests a situationwhere an average Nigerianend up owning a second handcar, which most timesconstitute environmentalhazard due to the dangerousfumes emitted into theatmosphere.

Dr. Innocent Chukwuma isthe innovator of the first Madein Nigeria vehicles. Today,Innoson vehicles areacknowledged as theNigerian brand as the federaland state governments nowpartner with his company. Inthis interview with CharlesKumolu, Dr. Chukwumaespouses his vision to seeevery Nigerian drive a brandnew car.

As the first indigenousvehicle manufacturer inNigeria, how do you copewith the huge demand foryour vehicles?

When we started, our visionwas to cover the entire Africancontinent, and we remaincommitted to that vision.Presently, our manufacturingplant at Nnewi is built toservice the entire Africancontinent, and good enoughwe have been meeting upwith market demands. Ourstrategy is to planfuturistically, knowing thathuge orders will come, and asit stands today, we are able tomeet up with the hugedemands. We have themanpower and moderntechnology to cope withexpected challenges.

It is obvious you havemade a sudden in road intothe Nigerian auto market,what is the secret?

Well, there is a saying inIgboland that the market yousell is the one that you knowmuch about. In this businessat the risk of soundingimmodest I will say that Iunderstand it, and know theterrain. I started my businesslife dealing in automobiles,first motorcycles, and later wegraduated to motor vehicles.Today, we manufacture trucks,SUVs or what most peoplecall “jeep”. We also havebuses; refuse disposalvehicles, pick-ups and manyothers. So its an achievementbased on experience andknowledge.

Recently, at the FederalExecutive Council meeting,the Minister of Trade and

Investment revealed that themultinational Nissancompany has written thatthey want to partner withyour company in vehiclemanufacturing in Nigeria,have negotiations with thembegan? What is the scope ofthe cooperation?

Yes, I am aware that theyhave made such move,

and on our part we are readyto go into any cooperation thatwill boost the nation’seconomy, and lead toincreased productivity andprovision of jobs for ouryouths. Let me therefore saythat exploratory talks areongoing and at theappropriate time the cat willbe let out of the bag.

What is your reaction toPresident Jonathan’s desireto protect local industries

from foreign domination? I believe this government

means well for the country.For the first time in our history,we have a President that isdelivering on his promises,one after the other. Hissupport for local industries isphenomenal, andunprecedented. Take forexample the improvement inpower supply and access toloan facilities, and even thetransformation going on inother sectors, you can see thathe means well. So this issomething we asindustrialists are grateful for.As a company we can onlycomplement such goodgesture by supportinggovernment in whichever waywe can.

For instance, we plan tobuild mechanic schools toteach our young onestechnological skills asmechanics and techniciansthat will enable them survivein our ever changing world oftechnological innovations. Wewill also continue to supportboth the federal and stategovernments in therealization of their jobcreating programmes.

How durable are yourvehicles and how cancustomers access the spareparts across Africa?

The spare parts for ourvehicles are available at ourspare parts outlets in all partsof Nigeria, and countries inAfrica where you find ourvehicles. So it’s not ahindrance or problem at all.As for durability, you caneasily attest to this as you see

our vehicles on the road. Theyare as durable as otherstandard vehicles, and areofficially certified by therelevant government agenciesboth locally andinternationally.

So your company hasoutlets in other Africanc o u n t r i e s ?That is what I tried to explainwhen I said that our vehiclesparts go with our vehicleswherever we supply Innosonbrands. It’s a deliberatepolicy by us to ensure thatusers don’t run out of stock interms of servicing theirvehicles. But of course, youknow that brand new vehiclesusually require very minimalchange of spare parts, but itis standard practiceworldwide to support yourcustomers with maintenance,and to us this is a seriousobligation.

Power is a major factor inyour business, how arecoping with powerg e n e r a t i o n ?When we started this factory,the power output was abouttwenty percent, but today, wehave about seventy to eightypercent. So there is a lot ofimprovement with thisgovernment. With thisdevelopment, our industrywill develop more, becausewhen we started, we weregetting about twenty percentfrom the national grid, butnow, there is a remarkableimprovement. We are sohappy with the presentgovernment and what theyare doing in power.

•Dr. Innocent Chukwuma

•Mechanic workship

CMYK


Homes & Housing Finance

BRIEF

Ogun State governmentis to devote 12.72

percent of its projectedincome in 2014 to fundhousing development andurban renewal programme inthe state.

Governor Ibikunle Amosundisclosed this during thepresentation of the state’s2014 budget proposals ofN210.21 billion on the floor ofthe state House of Assemblyin Abeokuta. He said that atotal sum of N26.74 billion,representing 12.72 percent ofthe total budget estimates, isbeing set aside for theprovision of of affordablehousing and urban renewalprogramme in the state in2014.

Amosun noted that theallocation will ensure thecreation of an enablingenvironment for housingdevelopment and urbanrenewal in the state, whilealso helping to tacklechallenges in environmentalmanagement. “We seehousing as both a socialnecessity and an economicopportunity. Our policy isfocused on creating theenabling environment forhousing development as wellas directly undertakinginterventions through theministry of housing, housingcooperation and OgunProperty InvestmentCorporation,” he said.

The governor said theministry of housing will tacklemajor housing projects suchas the Kobape residentialestate, a 50-hectare mixeddevelopment with fullinfrastructure such as water,power sewage systems andinternal roads in the greaterAbeokuta region. He said thescheme will comprise ofserviced plots and fullyfurnished houses at variousprice ranges. He remarkedthat a similar scheme was

Ogun allocates 12.72% of 2014budget to housingBy YINKA KOLAWOLE already being developed by

the ministry in the Sagamuand Ota areas, in addition toundertaking the new towndevelopment and AbeokutaCity Centre projects.

Amosun further revealed

that both OPIC and the state’shousing corporation willconcentrate on executing theAgbara Urban Renewal andHousing programme, IjebuOde New GRA projects,Orange Valley, Abeokuta

Urban Renewal project, NewMakun City projects atSagamu Interchange, IsheriCommercial City projects aswell as building of over 500houses for the state’s civilservants.

Nigeria Labour Congress(NLC) has sealed an

agreement worth $6 billion(about N960 billion) with aproperty development firm,Kriston Lally EPC NigeriaLimited and its foreign partner,Kriston Lally Enterprises Atti-kat, for the construction ofaffordable houses for workers.

A statement by NLC revealedthat the deal will ensure theconstruction of over 600,000housing units accross thecountry, with the foundation ofthe first phase planned for thesecond week of December. Itfurther stated that arrangement

NLC, developer in N960bn housingdeal for workers

to commence construction ofthe project was concludedwhen the NLC President, Mr.Abdulwahed Omar, recentlyled other members on a visit toAthens, Greece, to finalise theagreement with the partners,which included funding andmanpower.

The NLC said the project isaimed at providing anopportunity for its membersaccross the country to owntheir own houses, adding thatthe houses would be providedto members of Labour in bothpublic and private sectors at theinterest rate of two percent. The

proposed housing projectwould consist of one-bedroom,two bedroom detached andsemi-detached, three bedroomdetached and semi-detached,four bedroom bungalows andfour bedroom duplexesdetached as well as semi-detached, the statement added.

Omar was quoted in thestatement as saying that the tripto Greece is rewarding. “Whenwe came on board, wepromised our members that wewill do as much as possible toensure that as many workers aspossible get shelter before theyretire, because we believe it isone of the very serious issuesfacing Nigerian workers today.

The partnership is aboutproviding quality andaffordable housing for theNigerian workers. We havefound in this Kriston Lally avery formidable partnershipthat we can rely on, we cantrust and we can work with.We are also reassuringNigerian workers that by thegrace of God, when we go intothis it is going to continue tohave a multiplier effect untilNigerian workers arecomfortable in the area ofhousing,” he remarked.

Lush Luxury Wall Coverings is offeringmiddle and high income Nigerians

access to global, prestigious luxury homefurnishing accessories.

The firm is involved in design selection,sales and installation of luxury wallcoverings to commercial and residentialfacilities.

Located on Ozumba Mbadiwe Street,Victoria Island, Lagos, it offers some of theworld’s most prestigious luxury brands likeVersace Home (Italy), Phillip Jefferies(USA), Architects Paper (Germany), Fabcote

Lush offers Nigerians luxury home accessoriesHaute Couture (South Africa) and PorscheDesign Studio (Germany).

Lush has the official and exclusive agencyin Nigeria of all the brands in its portfolio,thereby giving its clients unparalleledcustomer service and absolute confidencein the authenticity of its products. Inaddition, it provides a luxury experiencefrom inexhaustible classical and modernwall coverings to suit the ambience andbeauty of the clients’ interiors. Thecoverings are targeted at a decidedlydiscerning, savvy and affluent clientele.

BoE cuts mortgagesupport to avoidhousing bubble

Bank of England (BoE)moved to head off the

risk of a housing bubble inBritain by announcing itwould put the brakes on ascheme launched last year tohelp boost mortgage lending.

The central bank said theFunding for Lending Scheme(FLS) would cease to offerbanks incentives for mortgagelending and instead berefocused on helping smallfirms to borrow. The newscaused shares in house-building firms to tumble.

Britain’s economy and itshousing market have stagedan unexpectedly strongturnaround since the FLS waslaunched by the BoE andfinance ministry in July 2012in an effort to spur the long-delayed recovery byunblocking credit markets.“Given the access to credit forhouseholds now ... it wouldno longer be appropriate ornecessary for us to have ourfoot on the accelerator. It’sbetter to shift into neutral,”BoE Governor Mark Carneysaid.

19,400 FG workersbenefit fromhousing loan

A total of 19,400 federalcivil servants have

benefited from the FederalGovernment Housing LoanScheme, Head of Service ofthe Federation (HOSOF),Alhaji Bukar Aji, has said.

He said this at aninteractive session organisedby his office for state-basedFederal Government civilservants in federal Ministries,Departments and Agencies(MDAs) in Asaba.Represented by Dr ClementIlloh, Permanent Secretary,Federal Ministry of Labourand Productivity, Aji saidthose who applied for thefacility and were yet to begranted should exercise patience, adding that theirrequests would be lookedinto.

A cross section of the civilservants called for theabrogation of the NationalHousing Fund (NHF) and arefund of all contributionsmade by workers to them.Some of the workers,according to NAN, said NHFhad never profited them inanyway and complained thatthere was no information onthe fund’s activities, as loanswere not granted them yearsafter they had applied forthem.

CMYK


Insurance

BRIEF Royal Exchange posts N7bn GPIStories by ROSEMARYONUOHA

Royal Exchange Plcgenerated gross

premium income of N7.61billion in the 2012financial year, againstN6.82 billion realised thepreceding year. Thisrepresents an increase of11.58 per cent, itsChairman, KennethOdogwu, said.

Odogwu disclosed this toshareholders at thecompany ’s AnnualGeneral Meeting (AGM)in Lagos recently.

He said the company’sclaims expenses duringthe year amounted toN1.63 billion, similar toN1.64 billion paid in 2011.

Odogwu noted that thefirm’s expense increasedby 15.13 per cent, fromN1.85 billion in 2011 toN2.13 billion last year,adding that this translatedinto net income beforeoverhead expenses ofN3.54 billion, as againstN3.17 billion of 2011, anincrease of 11.91 per cent.

He said the firm’sinvestment incomeincreased significantly by35.10 per cent fromN475.21 million in 2011 to

N642.02 million last year,adding that the appreciablerecovery of the capital andmoney markets instrumentsenabled the firm to maximisereturns from its quotedequities and cash portfolios.

He said the group achieveda profit before tax of N743million, stressing that theachieved result was due toimprovements in theperformances of the group’ssubsidiaries.

His declaration of the

board’s decision to pay adividend of 4kobo per 50koboordinary share was acceptedby the shareholders, whopoured encomiums on the firmfor paying dividend at a timemany companies are facingchallenges.

President of theIndependent ShareholdersAssociation of Nigeria (ISAN)Mr. Sunny Nwosu, lauded thecompany’s courage to paydividend to shareholders. Heurged the company to sustain

the confidence reposed on itby doing what is right toshareholders.

Meanwhile, the companysaid that in spite of theoperating environmentexperienced by the insurancesub-sector and the financeindustry in general, itremained elastic in itsperformance thereby,exploiting new opportunitiesand maintaining a strong holdon its existing business since2012.

A.M. Best EuropeRating Services

Limited has affirmed thefinancial strength ratingof B (Fair) and issuercredit rating of “BB” ofCustodian and AlliedInsurance Plc. Theoutlook assigned to bothratings is stable.

The rating affirmationsreflect A.M. Best’s

A. M. Best rates Custodian Stableexpectation that Custodian’srisk-adjusted capitalisationwill continue to remainsupportive of its current ratinglevel. Additionally, thecompany’s competitive profileand operating performanceare expected to remain solid.

Custodian’s risk-adjustedcapitalisation is expected toremain at a strong level andgoing forward, A.M. Best

expects the company’s risk-adjusted capitalisation to besupported by the robustearnings of the Group.

Prospective operatingperformance is expected toremain solid. The CustodianGroup announced profit beforetax of N2.5billion for theunaudited third quarter ended30 September 2013. Thisindicates an increase of 89.5

per cent over the N1.3 billionrecorded in the correspondingperiod of 2012. Profit after taxincreased by the sameproportion from N1.14 billionto N2.1 billion, while theGroup’s asset base increasedfrom N40.9 billion to N47.2billion, indicating 15.3 per centgrowth within a nine-monthperiod. The gross writtenpremium was N19.8 billionfrom N9.4 billion.

Commenting on the ratings,the Managing Director,Custodian and AlliedInsurance, Mr. Wole Oshinsaid “This is a welcomedevelopment. A. M. Best is theworld leader in insuranceratings, and we are pleasedwith the stable outlook giventhe company. We will continueto address our operations tobenchmark against the best inthe world, with the view toimprove this performance inthe near future.”

Custodian and AlliedInsurance Plc is quoted on TheNigerian Stock Exchange(NSE), and is approved by theregulatory bodies in Nigeria tooffer insurance services, andprovide services that extendbeyond national frontiers.

Prestige Assurance Plc has promotedsome of its top management staff to

higher levels.In a statement, the company said that the

affected staff include: Mrs. P.N. Jibrin-Yaroto Assistant General Manager (AGM)II fromSenior Manager. She is a product of ObafemiAwolowo University and Lagos StateUniversity where she obtained Diploma inBusiness Administration and MBAMarketing respectively.

A Chartered Insurer of London and Nigeria(ACII), Mrs. Jibrin-Yaro has a wide range ofexperience in insurance practice.

Also promoted was Mrs. EuniceOlufunmilayo Aina from Senior Manager toAssistant General Manager (AGM)II. She isa 1992 graduate of Accounting from thePolytechnic, Ibadan, a Fellow of the Instituteof Chartered Accountants of Nigeria, (ICAN),

Prestige assurance promotes staffa certified Information Systems Auditor(CISA) and a Certificate Member of theChartered Insurance Institute of Nigeria.She joined Prestige Assurance Plc in 2001as Internal Auditor. She had wide rangeof experience in Accounting, Audit &Control. Some other staff were elevatedfrom Assistant Manager to Manager; Snr.Superintendent to Assistant Manager;Superintendent to Snr. Superintendent aswell as Assistant Superintendent toSuperintendent.

On the whole, eight are in the categoryof Senior Staff while two are in the categoryof Junior staff.

The management said the promotion wasin line with the tradition of the companyto reward deserving staff to strengthen themanagement team to position the companyto a greater height.

L-R: Ajiborode Abiodun, Senior Brand Manager Fabric Care, Alegun Wilson, Human Re-sources Business Partner, Akinyemi Lolu, Finance Director, Graffiths Sandy, Marketing Di-rector Fabric Care and Ekekwe Roy, Marketing Manager Fabric Care all of PZ Cussons Niger-ia Plc at the media Unveiling of ZIP detergent new TVC in Lagos.

The National PensionCommission in response

to the increasing need ofpensioners and otherstakeholders in the pensionindustry to get adequateinformation concerning theirsavings and other operationsof the commission haveestablished the ContactCentre information network.

Pencom said the ContactCentre would provide thepublic with an easy means ofcontacting the Commission tolodge complaints or makeenquiries about pensionissues.

According to EmekaOnuora, HeadCommunication Departmentat Pencom, the ContactCentre which is a moreimproved method of handlingcomplaints from the publicwill offer the public theopportunity to relate with theCommission via telephonecall and e-mail withoutnecessarily visiting Pencomoffices to make enquiries orlodge complaints.

Though the Commissionhad previously engaged theuse of telephone, e-mail,social media and letters toresolve issues raised bypensioners and the generalpublic in the past, it was notable to track the history ofcomplaints or enquiries sincesuch transactions could not bestored electronically.

“Previously, theCommission has adecentralised process throughwhich it deals with complaintsand requests from the public.Requests from members of thepublic usually come invarious ways, such astelephone calls, e-mails,social media and letters. Thedecentralised manner in whichcomplaints are addressedresulted in pensioncontributors/retirees issues notbeen stored electronically.Consequently, this led to adifficulty in tracking andretrieving a history of previouscomplaints lodged by clients.The total customer satisfactionthus falls short of expectationsleading to dissatisfiedcustomers and the attendantnegative perception about theservices rendered by theCommission”, Pencom noted.

But Onuora explained thatthe newly adopted Call Centremodel has been designed totake care of the challenges ofthe past since it can storeinformation electronically andas well track the history oftransactions.

PenCom rollsout contactcentre

CMYK


Business & Economy

The auction, held inGeneva, themed: “RolexDaytona Lesson One” is partof activities to mark the 50thanniversary of the Daytonaand all 50 Daytonamechanical timepieces on

By PROVIDENCE OBUH

Daytona Celebrates 50th anniversary with Super Auction

Again, Rolex hascemented its place with

the success recorded at the2013 Aurel Bac’s Auction inNovember.

offer sold beyond originalestimates with the PaulNewsman manufactured in1969, a stainless steeloutshining the lot as it wentfor a whopping sum of$1,088,889. The 50 Daytona

watches were auctioned for atotal of $13,248,167,quadrupling the auction’spre-sale estimate.

Reacting to thedevelopment, Mr. JohnObayuwana, the Chairman/CEO of Polo Nigeria Limited,the official retailer of theRolex including the Daytonawatches in Nigeria said theoutstanding success of theDaytona timepieces at the

auction underscores the placeof the Daytona model amongdiscerning people across theworld.

“What the world justwitnessed is an endorsementof the classical standard ofRolex timepieces, especiallythe Daytona which bringswith it timeless quality andreliability, reasons for whichthose who have arrived covetit,” he said. Unilever Nigeria PLC

has commenced anational consumerengagement initiative with itsBubble man characterrewarding consumers acrossthe country for their patronageof Sunlight detergent.

Unilever’s Brand BuildingDirector, David Okeme, saidwhile the sunlight Bubble manwill be visiting variousneighbourhoods, the brand iscelebrating consumer for theiryears of loyalty in variousmarket and neighbourhood

Unilever’s Sunlight fete consumersacross the country with giftitems.

Okeme, said that theSunlight has embarked onnational activation andconsumer engagementinitiative which started inNovember and will runthrough January 2014.

“In the spirit of the seasonof celebration, the bubbleman’s visit to various part ofthe country will also besupported by a special funsquad called the flash mobthat will seek to excite the

consumers across the countryon the brand’s fragrance.

Ikeja City Mall, ICM, hasrewarded winners of its

independence promo winnersin Lagos.

The winners; three in numberwho were presented withdummy cheques of $1,000,$900 and $600 dollars for thefirst, second and third winnersrespectively, at the Central

ICM promo winners get prizesManagement Office of the mallbrought to the climax thepromo which commenced inOctober 2013.

Part of the prizes of the promois that the first prize winner isto travel to Obudu ranch withhis or her spouse for a treatalongside the prize money of$1,000, an equivalent of over

N160,000. At the raffle draw that produced the winners,sponsors of the promo,Hermingsway Safari’s OutdoorManager, Mr. EmmanuelFariogun, said the branddecided to “sponsor the promobecause the brand lovesNigeria, we want to give backin our own little way. It is alsoa way of giving back to the malland to help our marketing aswell.”

SURE-P: OKSURE-P: OKSURE-P: OKSURE-P: OKSURE-P: OKONJO-IWEALAONJO-IWEALAONJO-IWEALAONJO-IWEALAONJO-IWEALA’S W’S W’S W’S W’S WAAAAATERLTERLTERLTERLTERLOO.OO.OO.OO.OO.“Every great enterprise startsoff with enthusiasm for anexalted aim and ends upbogged down in pettypolitics”, Charles Peguy,1873-1914.

But in Nigeria, it almostinvariably ends up

getting bogged down incolossal corruption. Theminute government embarkson a multi-billion nairaenterprise the sharp guysdevise the plans to subvert itby robbing the programmeblind. SURE-P is going theway of National ID CardScheme, Obasanjo’s $13-16billion IPP for which we hadnothing to show until PHCNwas privatized and theNational Water RehabilitationScheme of another regime.

However, SURE-P isdifferent in one respect – itwas so hastily cobbledtogether, by the FinanceMinister, and full ofunattainable goals that theoriginal document wasordered withdrawn byPresident Jonathan in lessthan six months. That wasafter millions of naira hadbeen wasted printing thepamphlets and a multi-mediacampaign was underway topromote the illusion ofprogress. It was not Okonjo-Iweala’s finest hour.

The decision to junk theoriginal SURE-P programmewas one of the mostcourageous decisions of thePresident – given the globalprofile of the FederalMinister of Finance, DrO k o n j o - I w e a l a .

Unfortunately, for thePresident and, more so, forthe Minister, even what wasleft was bound to fail to meetthe objectives set for it – evenif no kobo was stolen. But,unknown amounts of thefunds have been stolenalready and the Senate mighthave discovered anotherwhopping misappropriationof SURE-P funds. Corruptionbeing so endemic in theNigerian system, expecting amulti-billion naira scheme tobe corruption freerepresented the triumph ofwishful thinking overhistorical experience. NowSURE-P is in a mess and thatis putting it mildly.

Before proceeding, kindlylet me remind the reader thatas far back as 2011 whenSURE-P was announced by aconfident, or was it over-confident, Minister ofFinance, I had made thefollowing observations; afterproviding a small catalogueof grandiose governmentprogrammes which hadfailed in the past. Writingunder the title: SURE-P:SURELY A DEFECTIVEPROGRAMME, I made thefollowing observations.

“Dr Okonjo-Iweala wasalso the Minister of Financein 2004; when the NationalEconomic EmpowermentDevelopment Strategies,NEEDS, was launched filledwith promises – very few ofwhich were redeemed. Onecardinal un-dischargedpromise related to thelaunching of NEEDS II.Nobody in government

discusses NEEDS I anymore;certainly NEEDS II has beenconsigned to the dustbin. Shewas the lead economicmanager then as well. Sheshould go and read againwhat she said in 2004. It mightbe embarrassing but it wouldbe illuminating – to her. Wehave learnt our lessons.

Those are actually minorreasons for being skepticalabout the new programme,titled, SUBSIDYREINVESTMENT ANDE M P O W E R M E N TPROGRAMME (SUREPROGRAMME). The newskepticism is fuelled by SUREitself. The 17-page document,providing the justification for

subsidy removal, would begraded D by the mostgenerous Professor ofEconomics at either Harvardor MIT for several glaringreasons. It containsunpardonable omissions;deliberate or inadvertent and,worst of all, THE FIGURESDON’T ADD UP. In theireagerness to convinceNigerians to swallow thebitter pill of subsidy removal,the Ministers of governmentand Special Advisers, havesugar-coated the pill beyondreason; it might end up givingus diabetes. It is difficult tobelieve that they believethose figures themselves. Ifthey do, their individual andcollective grasp of figures isnot as good as it should be. Ifthey don’t, then, they havedemonstrated why Nigeriansshould continue to distrustgovernment.”

Now, the SURE-Pprogramme is under attack onall fronts. While mostNigerians cannot feel itsimpact, it is now enmeshed ina looming scandal inconnection with whatSenators regard as N500billion missing SURE-Pfunds.

Top officials of the CBN andthe NNPC, which were alsofingered as accomplices in thislatest national probe weresummoned to a SenateCommittee hearing but failedto appear prompting SenatorAbdul Ningi, one of thelongest serving senators tolament that: “Today, again,we sat here glued to our seatsfor over one hour, awaiting the

arrival of the officials of theNigerian National PetroleumCorporation or their agentsand the Central Bank or theiragents”. He went on to addthat I have been a member ofthe National Assembly rightfrom inception in 1999 and Ihave never seen this kind ofimpunity and disregard forconstituted authority”.

The NNPC, meanwhile,had washed its hands of themissing funds claiming everykobo was paid to theFederation Account, as andwhen due. That shifts thefocus back to the CBN and theMinistry of Finance.

Granted the Minister is notinvolved in any shady deals.In fact, she is probably one ofthe few top level officials ofthis government withpersonal sound integrity. But,she created SURE-P, veryhastily, without adequatecontrols to minimize themassive embezzlement thatfollows any major project orprogramme in Nigeria.Already, the programme isgenerally perceived as afailure and with its decline inpopularity the Minister ’sonce towering reputationtakes a dive also. To save that reputation, it willnot be bad idea if SURE-P isscrapped and replaced witha carefully crafted programmewhich promises less butdelivers most of what ispromised. A little success isalways preferable to a majorfailure anytime.

Visit:www.delesobowale.com

,

,

Thedecision tojunk theoriginalSURE-Pprogrammewas one ofthe mostcourageousdecisionsof thePresident


Micro - Finance

L-R: Mr. Mathieu Seguin, National Commercial Director, Nigerian BottlingCompany; Muftau Fasasi, Finance Director, UAC Restaurants Ltd; Mark Hed-derwick, Managing Executive, Emerging Markets and Director, UAC Restau-rants Ltd; JID Dada, Executive Director, Corporate Services and Derrick VanHouten Managing Director, UAC Restaurants Ltd.

The Association ofM i c r o -

Entrepreneurs of Nigeria(AMEN) says they wantto shun borrowing fromcommercial andmicrofinance bank tofinance their businesses.

National Secretary,AMEN, Mr. NwokelemeFrederick, who disclosedthis to FinancialVanguard in a telephoneconversation, weekend,said they have reachedadvanced stage to poolfunds together in form ofcooperatives to assisttheir members who havefinancial need to promotetheir businesses.

“We are going to poolabout N10 million toenable us reach ourmembers who areworking with smallcapital nationwide,considering that a lot offund is required for asmall producer. Thesignificant of this

Micro entrepreneurs to shunborrowing from banksStories by PROVIDENCE OBUH

cooperative is that it willreduce borrowing frommicrofinance banks andsome commercial banksfor our members.

“We are at the stagethree in line with ourmandate in making thecountry an industrialisednation. This stageinvolves establishing afinancial institution tocater for membersfinancial needs.

“This is the only way toget out of the activities ofmicrofinance banks thatuses the opportunity toexploit us with their sky-rocketed interest rate.

“The bank of Industryhas joined the vision,after series of invitationletter and negotiation.They are now partneringwith us. They haverequested all AMENmembers to submit theirproposal and indeed wehave submitted. Theyhave been visiting our

members’ factories. Ibelieve at the end of thevisitation our memberswill laugh,” he said.

Meanwhile, theassociation’s businessforum is scheduled tohold on December 13,

2013, where distributorsand wholesalers will beopportune to access avariety of made inNigeria product with ac o r r e s p o n d i n ginauguration of thecooperative fund.

different cups of varyingcolours: red, yellow,green, blue and black,will span throughNovember 22 to January12, 2014, and over 120,000coca-cola cups will bewon. Speaking at thepresentation ceremony,Managing Director, UACRestaurants, Mr. DerrickVan Houten, said that theinitiative is a way ofsaying “Thank you” to itsnumerous customers whohave remained loyalthroughout the year andalso geared towardsendearing new trials fromcustomers who have notpatronised the food gianta long time ago.

“To collect the cup,consumer should buycoke products worth N1,500 from any Mr. BiggsRestaurant, nationwideand he gets a free cup,Houten said.

“We see this as anexciting adventure forconsumers as there isalways something

Yuletide: Mr. Biggs rewardcustomers with Coke cup

As part of theyuletide season

celebration, Mr. BiggsNigeria, in conjunctionwith Coca-Cola Nigeria,has unveiled coke cup toreward its loyalcustomers.

The promotion, with thetitle, “Colours of FunBonanza” comes in five

different to look forwardto. It is an interestingquest which will keep theconsumers coming backfor the next cup colourand then the next oneand so on until all fivecolours have beencollected.

“In terms ofcommunication, thepromotion will be driventhrough various mediaplatforms, both traditionaland digital, to create therequired awareness andeducation for ourconsumers. Thepromotion is also ofnational spread, open toconsumers in over 25cities where we arelocated.

“It is interesting to notethat these cups are realcollector’s items. Theycome in five different butvery exciting colours(Red, Yellow, Green, Blueand Black) all amplifyingthe colourful nature of theyuletide season,” he said.

On what gave rise to

the choice of cup,Commercial Director,NBC, Coca-Cola, Mr.Matthew Seguin, addedthat the coloursrepresented thecompany’s brand image,saying, “you are havinga meal, you need to havea cup to go with thedrink.” In his welcomenote, Executive Director,UAC Restaurants, Mr.Joseph Dada explainedthat Mr. Biggs is goingthough rejuvenation andchanges that will bringremarkable progress inQSR market,encouraging its partnersto be part of the change.

“One unique thingabout Mr. Biggs is that wetry as much as possible toride on the challengesthat we see in the QuickService Restaurant(QSR).”

Dada commended thecoke company for thepartnership, which hedescribed to be stronger.“This is the first time,going forward we expectmore to happen. Mr.Biggs is going throughrejuvenation, changesthat will bring remarkableprogress in this market.”

Etisalat Nigeria has launched“Easybusiness Millionaire

Hunt,” a scheme for Small andMedium Enterprises (SME) with aview to helping entrepreneurs realisetheir business ideas.

Director, Business Segment, EtisalatNigeria, Mr. Lucas Dada, said thatthe Easybusiness Millionaire Huntwill go a long way to help youngentrepreneurs who possess businessideas but lack the capital to pursuetheir dreams.

Dada said, “EasybusinessMillionaires Hunt is designed toreward Nigerian SMEs with the mostviable business ideas with gift itemssuch as business grants worth N20m,free training courses onentrepreneurial management andadvisory services from the Enterprise

Etisalat offers SMEs N20m grantsDevelopment Centre of the PanAtlantic University, office equipmentand smartphones to kick off theirbusiness in the right direction.”

He said that the initiative wouldprove beneficial to SME ownersacross the country, explaining,“although the top 10 winners withthe best business ideas will berewarded with N2 million each,there are also other prizes to be wonwhich include free businesstrainings at the EnterpriseDevelopment Centre of the PanAtlantic University for the top 50winners, in addition to getting officeequipment to help them start uptheir business and over 200Smartphone’s to be won on a dailybasis throughout the promoduration.”


Tax Matters

BRIEFS

With governmentspending rising, it is

important for revenueadministrators to deviseingenious means ofimproving tax collection. Onesure way of doing so isautomation of the taxcollection process.

Recently the FederalInlandRevenue Service(FIRS) announced ongoingefforts to automate taxcollection by 2014 with theIntegrated Tax AdministrationSystem (ITAS) to beimplemented on a tailoredmade solution known as theStandard IntegratedGovernment TaxAdministration System(SIGITAS). The primary goalof this project is to re-engineer the taxadministration servicedelivery, eliminate gaps andredundancies in the currentadministrative assessmentprocesses by leveragingtechnology in line with globalbest practices ultimatelyleading to simpler taxpayercompliance.

The objective is to transformthe tax administrationsystems. Optimize itscontribution to nationald e v e l o p m e n t . B r o a d l yspeaking, automation of thetax administration process willengender transparency andefficiency with little humaninterface. The most vitalaspect of SIGITAS will be towiden the tax net, deepencompliance, create a friendlierenvironment for taxation aswell as curb leakages in taxadministration. Also, theintroduction of SIGITAS willstandardize processes whichmean reduced turnaroundtimes for service offerings totaxpayers.

A major highlight of thedeployment of SIGITAS is theautomation of unifiedcommunications andenterprise collaboration,document managementportal, as well as theautomated Value added taxcollection system. ITAS is alsoprimed to support taxpayersin complying withregulations by reducing theadministrative burden onthem and providing easyaccess to information as andwhen due. It is expected thatby the time ITAS is deployedtaxpayers will be able to viewtheir entire tax history offiling and assessment withthe FIRS.

Modernizing taxadministration with SIGITAS

In order jurisdictions whereSIGITAS had beenintroduced such as Mali andRwanda, taxpayers are ableto use the platform as a onestop shop- with easyintegration of all tax types-registering a tax ID, data oftransactions etc. SIGITASalso has the capacity tohandle a robust framework fortax roll, assessment,collection, audit, objectionappeals, document handling,reporting, external systemintegration, systemadministration andaccounting for eachuser.Instructively SIGITASoffers a platform for taxpayersand tax authorities to interactin a more transparent andconfidential manner, whilealso providing valuableinformation for the taxpayer.

The deployment of SIGITASshould be encouraged by allstakeholders for many

reasons. It will among otherreasons reduce the country’sover-dependence on oilrevenue with an expectedsurge in non oil taxes raisingrevenue figures needed forthe development of socialinfrastructure. Also it isexpected that the ITAS willsignal a re-orientation of theFIRS personnel in terms ofskills and capacity in thebusiness analysis function tomeet the objectives of theinstitution as well asstrengthen the governanceand transparency with fair andequal treatment of taxpayers.And to suit Nigeria’s ethnicdiversity, it can be configuredto be multilingual and offersa water tight securityprotection.

But for SIGITAS to besuccessful there is need

for synergy and integrationwith other similar projectsacross revenue generatinginstitution such as the recentlydeployed TaxpayerIdentification Number (TIN)for clearing of all imports intothe country. This essentiallybrings importers into the loopof both the FIRS and NigeriaCustoms Servicesimultaneously. This hasimpacted positively on therevenue collection profile intothe federation account. So alsofor the Taxpayer IdentificationNumber (TIN) integrationcurrently ongoing nationwidewhich is being supervised bythe Joint Tax Board (JTB). TheFIRS also needs to buildmomentum in the synergywith the Corporate Affairs

Commission so as tointegrate their processesespecially in the area ofdatabase building whichmakes it easier to reachthe untaxed or “hard totax”.

A successful ITASproject will be one that isable to create value for allstakeholders bysimplifying taxpayercompliance processes,keeps pace witht e c h n o l o g i c a linnovations, lowers costof collection withseamless data andexchange of informationsynergy with keystakeholders (MDAs,banks etc) and supportregulatory demands in asimplified manner. Itwillalso effectivelyencourage self-assessment filing of taxas against administrativeassessment.

In summary, ITASappears to be the answerto shoring up non oil taxin the face of dwindlingoil revenues. A robusttechnology driven taxadministration willdefinitely be able toachieve more if it fullyoptimizes the latentpower it holds. The futureof Nigeria’s social andeconomic developmentdepends on atransparent and fair taxcollection system thatmust keep improving tomeet with social andi n f r a s t r u c t u r a lchallenges.

Konga’s BlackFriday and CyberMonday salesdebuts in Nigeria

Nigeria’s online retailer,Konga.com has brought

online discount sales platform,Black Friday and CyberMonday Sales, to Nigeria.

Dubbed ‘Fall Yakata,’ Kongasaid, the sale is the biggestever undertaken by any retaileronline or offline in Nigeria.

“ You may have heard ofB l a c k F r i d a y a n dCyber Monday sales in theUS and Europe. Konga.com isbringing you two days of mindblowing price slashes. Imaginethe Play Station being sold forN60, 000 instead of N138, 000regular prices, Ruby Woolipstick that is normally N4, 000sold for N2, 000 or TecnoPhantom A+ phone that isN39,000 that will be sold foronly N19,000. You will findChristmas clothes that arenormally sold for N30, 000selling on Fall Yakata sale foronly N10, 000,” explainedKonga in a statement.

It added that the year hasbeen an amazing year forKonga.com as they won theonline retailer and bestemerging brand of the yearawards and moved to a new120,000 sqrfeet fulfillment centre andcelebrated its one yearanniversary.”

L-R, Emmanuel Etim,Joseph Etim,Brand Ambassador Of E-SCAN,Mr AlbertUduma,Managing Director/Chief Executive Officer Global Investment &CommunicationLimited And Ngozi Uduma,Executive Director Global Investments & CommunicationLimited.At the Press Conference to Annouce a new Product E-SCAN an Anti Virus SoftwareFor Andriod Mobile and Tabs Held at Planet One Mary Land Lagos.PHOTO;AKEEM SALAU,

,

By FRANK OBARO

APR winsInternational QualityCrown award forexcellence

In recognition of itscommitment to quality,

leadership, technology andinnovation, Africa PrudentialRegistrars Plc, a leadingNigerian registrar and the firstto be listed on the NigerianStock Exchange, has receivedthe International Quality Crown(IQC) Award in the Goldcategory.

The IQC Awardacknowledges cutting edgecompanies from around theworld for their firm commitmentto excellence, innovation andleadership. The ceremony,which held on November 24 inLondon, was hosted byBusiness Initiative Directions,a leading global organisationthat promotes quality culture intop businesses.

Peter O. Ashade, ManagingDirector/CEO of AfricaPrudential Registrars, was onhand to receive the award,saying, “Over the years, wehave built a reputation forinnovation and high quality ofservice; we believe this is whathas maintained our leadingposition in this sector in Nigeria.

The most vitalaspect ofSIGITAS will beto widen the taxnet, deepencompliance,create afriendlierenvironment fortaxation as wellas curb leakagesin taxadministration

36 — Vanguard, MONDAY,DECEMBER 2, 2013

Vanguard, MONDAY,DECEMBER 2, 2013 — 37

CMYK


CMYK


Advertising, Media& Marketing

Leonard L. Berry and A. Parasuraman put itbeautifully. In their classic, Marketing Services:

Competing Through Quality, they describe superiorservice recovery as “doing the service very right thesecond time.” In the simplest of terms, service recoveryis the act of making things right for the customerwhenever a service failure is occurs.

Should we aim at 100 percent accuracy in servicedelivery? Absolutely. Can we always achieve it?Maybe not. Do customers expect us to do it right atall times? They have a right to do so. But, fortunately,they also appreciate that occasionally things may goamiss despite the best of efforts.

Given that we should all endeavour to give greatservice the very first time and every time, there aretimes when things simply don’t work out that way.Since those who deliver service are fallible humans,they are bound to make mistakes once in a while.Sometimes, some situations beyond everybody’scontrol (the weather, for instance) limit the ability ofservice people to meet up with customer expectations.At other times, sheer human error or poor attitudecrops up. Thus a delivery date may be missed, a busservice may take off late, a package may be delayedor the wrong product may be shipped.

Once the organisation is aware of a service failure –whether it discovers on its own or through a customercomplaint – it is the manner of righting the wrongthat makes all the difference. An excellent servicerecovery programme offers an organisation theopportunity to showcase its service orientation to anotherwise angry customer. Service recovery may, incertain situations, involve bending over backward toensure that the customer is happy once again. Insome organisations with excellent service culture,frontline staff are authorized to spend up to a certainamount of money in resolving a customer complaintwithout recourse to a superior. In others, there is apolicy of complaint resolution at first contact. Thismeans that whoever receives a complaint first or getsto know about a matter first, owns the problem andensures that it is resolved immediately to thecustomer’s satisfaction.

What’s the payoff for “doing the service very rightthe second time”? In one word, loyalty. Variousstudies indicate that when a complaint is satisfactorilyresolved, most customers will continue doing businesswith the organisation and may even become more loyalthan they would have been if there had been noproblem. This is known as the service recoveryparadox. Do you need to disappoint customerssometimes in order to execute an excellent servicerecovery and earn their loyalty? That’s clearly notthe way to go. The fact though is that customers arehappy with those who resolve their challengeseffectively. They also spread positive word of mouth,which brings in more customers.

But we need to clarify one point. The customer is theultimate judge of satisfaction. Therefore to makedissatisfied customer happy again, the organisationmust tackle the complaint with despatch, courtesy andempathy. If the service recovery process is long-windedand rigorous, the customer may remain dissatisfied afterthe problem has been resolved. Speed is of the essence.When we realise that most customers won’t complainthen the importance of excellent service recovery cannotbe overlooked.

It is important that every serious organisation have aservice recovery plan with a simple procedure in place.The story is popularly told of how Nordstrom, a specialtyretailer, accepted returned automobile tyres andrefunded the customer the amount he said he boughtthe goods although the company never sold the tyres.The company allowed this just to keep a customer happy.

Few companies would go as far as Nordstrom. Butevery company definitely has a great opportunity toleave lasting impressions on customers through servicerecovery.

Here are a few suggestions you should consider.*Have a service recovery system in place.*Put your service recovery plan to work once a mistake

has been identified, whether the customer is aware ornot.

*Speed is of the essence. Do it now.*Service recovery is not a cost. It is an investment.

Loyalty throughService Recovery

From Left: Hon. Commissioner of Education, Imo State, Dr. Uche Ejioguinspecting one of the classrooms with Airtel’s CSR Manager, ChindaManjor and Regional Operations Director, South Region, GodfreyEfeurhobo at Airtel adopted Community Primary School, Amumara,Ezinihitte, LGA, Imo State.

It is no exaggeration to saythat technology and

innovation, especially in this21st century, has made lifeeasier and simpler. Considerfor instance, air-condition,fridge, washing machine,television and Smartphones,to mention but a few, haveredefined the way humanslive and work on a daily basis.

Taking a look around, onewill be astonished to find outhow surrounded one is by amultitude of inventions whichhave transformed the waypeople live today.

It’s often overlooked, butthe impact of technology wehave around us has helpedmake a huge difference insociety, helping to break downpolitical, economic and socialboundaries.

Conventionally, creatingproducts that enhancepeople’s lives has been thekey route by which companiescan contribute to society.

Increasingly and even moreso in today’s interconnecteddigital age, companies arenow expected to go beyondbeing mere providers ofdesired goods and services.Today’s socially-consciousand democratized mediaenvironment meanscompanies are now lookedupon as corporate citizensoperating in a global village.Consumers and governmentsexpect them to contribute tothe societies in which theyoperate and co-exist.

In the early days, charitablecontributions and donationswere one way in whichcompanies were seen to be

How technology, innovationaffect consumersStories byPRINCEWILL EKWUJURU

‘doing good’ in societybeyond their daily business.Nowadays, this is notcredible. Consumers demandmore from them; they expectorganisations to contribute bythe very nature of their being,their very business objectivesneed to resonate socially tosurvive. Consumerspurchasing decisions evenhinge upon theseperceptions.

Social contribution as a

business concept wears a number ofdifferent names in the 21st century.However, rather than attempt toexplain these distinctions it is perhapsmore prudent to understand a briefhistory of how social contribution hasdeveloped as systemic must-have forall companies in operation. LGElectronics as an organisation hasmade sizable social contribution intoday’s digital age. LG’s leadership isconsolidated in providing social valuethrough the nature of its business,products and vision for the future.

Tecno mobile has furtherdeepened the

smartphone market as itexpands its market profile inNigeria, with the launch of itslatest addition in the phantomphone family, the Phantom

Tecno deepens Smartphonemarket penetration…Unveils Phantom AIII

AIII.The highly anticipated smartphone

was formally launched to the public atan elaborate ceremony in Lagos.

Speaking at the launch, VicePresident, Tecno Group, Mr. ArifChowdhury, said the device wasdesigned with a passion to give everyuser access to innovation andaffordability. “It is part of Tecno’sunwavering effort in expanding itsoffering which can be seen in thissuperior, innovative phone” he said.

According to him, the Phantom AIIIis an upgraded version of the TecnoPhantom A+, it has a sleeker body andbigger screen than that of itspredecessor, it comes with 6.0"captivating HD touch screen,4.2android operating system, ithas3.75g network capability, with1.5GHz quad core processor.

The Phone is equipped with memorycapacity of 16 GB rom plus 1 gb ram,13megal pixels rear camera and 8megalpixel front camera. It also has socialmedia application like Facebook,Whatsapp and Palmchat, applications.The Vice president added that he wasvery glad to announce a newcollaboration with BlackBerry,whichallows customers tofind,preloaded on Tecno devices, thefamous and popular BBM™ application.

Universal FurnitureLimited (UFL), a

subsidiary of Mood CreationFurniture Company hasexpanded its outlet to VictoriaIsland, Lagos.

Mr. Antoine Moudaber, thecompany’s Chairman, said theoutlet offers the latest ininternational luxurious styles.

“With an international flavourto the mood creation design,the collection offers a variety ofstyles, colours and texture-using the same high-qualitymaterials as leading brand-name manufacturers in the UK,Italy, France and Turkey. UFLaims to appeal to all strata of

Universal Furniture expandsbrand visibility…opens retail shop in V/I

the society.“UFL recently brought in new

management to drive a newstrategy and the retail marketdevelopment. With a shift fromits core focus: multinational andgovernment establishments welook to offer locally made highend furniture that competeswith Italian and Turkish madefurniture,” Moudaber said.

According to him, in 2009,the company purchased a newset of machines which spurredits exploration of mass retailproduction. Prior to this date,the brand was mainly availablefor large multinational andgovernment establishments. C

MYK


Email:[email protected], [email protected] page:www.lesleba.com/blog2Website: www.lesleba.comTel:0805 220 1997

Omoh Gabriel - Group Business EditorBabajide Komolafe - Ag. Finance EditorClara Nwachukwu - Energy EditorPeter Egwuatu - Head, Capital MarketYinka Kolawole - Bus. CorrespondentFavour Nnabugwu - Insurance CorrespondentGodwin Oritse - Maritime CorrespondentGodfrey Bivbere - Maritime CorrespondentMichael Eboh - Energy ReporterFranklin Alli - Industry/Agric. ReporterEbele Orakpo - Energy ReporterIfeyinwa Obi - Maritime ReporterRosemary Onuoha - Insurance Reporter

CONTRIBUTORSPrincewill Ekwujuru - Media/MarketingNaomi Uzor - IndustryProvidence Obuh - Micro FinanceLAYOUT - Graphics Department

Business & Economy

O U R T E A M

,

,

The subject of recklessdebt accumulation has

been discussed in severalarticles such as “AnotherUseless Debt Burden”November 2006, “NationalAssembly Fiddles as DebtBurden Cripples” May 2008,etc (please seew w w . l e s l e b a . c o m ) . Incidentally, when Nigeria’sDebt Management Office(DMO) was established in2003, the excruciatingexisting burden of externaldebt was over $35bn; domesticdebt, however, was sti l ltolerable and manageable,with treasury bills accountingfor about 60% at over N800bn,while treasury bondsaccounted for about N430billion.

Ultimately, after our exitfrom the controversial ParisClub debt with the payment ofover $12bn in 2006, ourexternal debt balance tumbledbelow $4bn. However,external debt has, of today,almost doubled to about $7bn,while domestic debt hasmultiplied from over N1tn tothe current level of aboutN13tn, without any criticalimpact on social welfare orinfrastructural enhancement.

What, we may ask, wasresponsible for the rapidaccumulation of “useless”domestic debts at atrociousinterest rates between 2006and 2013, during whichperiod our foreign reservesfortuitously also rose beyond$40bn, while CBNinexplicably hoardedhundreds of billions of nairaas idle funds?

The following is a summaryof an article published in2005, titled “WILL YOUBORROW N120BN IN SPITEOF IDLE BANK BALANCEOF OVER N4,000BN?” Onhindsight eight years later, itseems we may not have learntany lesson. Please read on:

Paradox of debt accumulation inspite of healthy reserves

“In early 2005, the DebtManagement Officeannounced FederalGovernment’s intention toborrow about N140bn in seventranches of N20bn each. Thepurpose of the new wave ofborrowing, according to DMO,was “To restructure part of theoutstanding 91-day NationalTreasury Bills into longer-tenured bonds; provide abenchmark instrument for thepricing of other securities inthe capital market, as well asfacilitate the development ofthe bond market ingeneral”.

“We recall that similar bondissues embarked upon by theDMO sometime last year(2004) earned investors aninterest rate premium of about17%. However, a closerexamination of the need forfresh government borrowings(with the attendanthorrendous interest charges)would show that the nation’sdomestic debt burden willinevitably increase in spite ofour existing huge idle foreignreserve base of over $32bn.

”The question is why mustthe DMO convert maturedshort-term treasury bills tolong term debts when in fact,we are adequately equippedto redeem these debts fromour existing huge idlereserves? Some analystswarn that our presentrepugnant burdensomeexternal debt of over $30bncomprises such high servicecharges as DMO’s presentinterventions. Even thoughthere is nothing to show forthose external debts, wenonetheless allegedly paidover three times the value of

the actual amount borrowedwithout reducing the principalsum.

This ugly reality may onceagain materialise in thedomestic scene, since there isno guarantee that DMO’sfresh 2-3 year bond will notalso be rolled over once againwhen these loans areeventually due forredemption.

”The second objective of theDMO in offering the current2nd FG Bonds for N140bn isto use the adopted interestrate as a benchmark on which

other rates in the Nigeriancapital market will take acue. In reality, this could bea possibility, but the truth isthat the primary instrument forcontrol of cost of funds isCBN’s Minimum RediscountRate. The MRR, currently at13% (2005), is considered veryhigh in view of MRR of 2-4%in serious minded,progressive and stableeconomies. Analysts willwonder why government’srisk-free borrowings, whichattract an industrially andeconomally disenabling highinterest rate of 17% should betargeted as a benchmark forcost of funds in the capitalmarket.

”The other objective ofDMO’s fresh bond issue is tofacilitate the development ofthe bond market in Nigeria;i.e. “to create a deep andready market for bonds in theNigerian capital market”.

Once again, observerssadly note that market

depth may not bring any directreal positive or tangible impactto most Nigerians; in anyevent, observers may arguethat the estimated heavy costburden of the N140bn FGBond 2008 Series does not

justify the superficial benefitof developing the bondmarket, in place of the directimpact of specific projectrelated bonds for provision ofverifiable enhancededucational, health and othersocial infrastructure.”

The above piece was firstpublished in July 2005; sincethen, the DMO and CBNhave rapidly fuelled the debtaccumulation process, so thatdomestic debt now exceedsN13tn ($80bn), while externaldebt is almost $7bn in 2013. Inexplicably, CBN & DMO’sdebts were incurredregardless of prevailingsurplus naira reserves,

particularly from the hugestock of surplus nairacontinuously mopped up withdouble digit interest rates andkept as idle funds by the apexbank.

In this manner, in spite ofhealthy reserves, the DMOand CBN set the pace forinstitutionalizing the processin which government borrowsback its own funds from thebanks at oppressive interestrates of up to 17%. Theproduct of this obnoxiousstrategy is the currentdomestic debt balance of overN13tn (about $80bn),ironically accumulatedsimultaneously with risingexternal reserves above $44bn,which sum ironically earnsminimal yields of probablyless than 3%. Yet,paradoxically, government’svoodoo economic and fiscalstrategy debars us fromaccessing these relativelyhealthy foreign reserves, toredress our high costoppressive debts.

In the same manner that theDMO commenced operationwith conversion of short-termto long term debts, thefashionable official currentdebt management strategy in2013 appears to be theconversion of the bloateddomestic debt of N13tn toforeign loans, because of theattendant cheaper cost offunds for external loans. Undoubtedly, a better strategywould be to put a lid onadditional loans, whileoperating an appropriatemonetary strategy that woulddrive down domestic cost offunds.

The Federal Governmenthas approved N10

billion to improve the servicesof the Conditional CashTransfer (CCT) scheme. Thisis contained in a statementissued by Mr DesmondUtomwen, the Media andCommunication Consultant tothe Millennium DevelopmentGoals (MDGs) Office inAbuja.

The statement quoted DrPrecious Gbeneol, the SpecialAssistant to the President on(MDGs), as explaining thatthe fund was to improvewomen and children heathcare delivery system. It addedthat the CCT was designed tostimulate demand for

FG approves N10bn for ConditionalCash Transfer scheme

healthcare by women andchildren. According to thestatement, the scheme isbeing scaled up to 30 stateswith total budgetary provisionof N20 billion this year.“Efforts are being made byinitiating Conditional GrantsScheme (CGS) as well as thedeployment of ground-breaking mobile moneytechnology to drive the newscale up of CCT.

“Therefore, Mr Presidentapproved a sum of N10 billionto improve the CCT schemefor the development of healthsector”, it said. It explainedthat CCT scheme’s objectivewas to assist the currentgeneration out of poverty

and develop human capital.The statement said that CGS

was designed as a vehiclethrough which saving madefrom the Debt Relief would beexpended on projects toactualise the MDGs efforts.

It also said that the MDGs’office was committed toimplementing schemes andprogrammes that wouldenhance health sector in thecountry. The statement saidthe schemes included theMidwives Services Scheme,Community Health ExtensionWorkers Initiative, the VillageHealth Workers Scheme and Saving One Million LivesInitiative and the UN MDGsAcceleration Framework(MAF). “These areinterventions designed to

improve human capacity andmake the health sector moreresilient.“In addition, theNational Primary HealthcareDevelopment Agency

continues to derive fundingfrom my office to fundprimary healthcare in Nigeriaincluding immunisation,” itsaid.

The question is why must theDMO convert matured short-term treasury bills to long termdebts when in fact, we areadequately equipped to redeemthese debts from our existinghuge idle reserves

CMYK

Documents

Financial 02 December 2013