business0518

C M Y K 

BRENT CRUDE 

GOLD PRICE 

COCOA PRICE 

MARKETS AND COMMODITIES MONITOR POWER GENERATION 24/03/15 Money 

US $ 67.98 

BDC NSE Close FMDQ Close Peak 

4,044.6mw 

$ 1,215.40 

USD 220 

POUND 338 

+92.81 

–0.51 Lowest 

3,334.5mw 

$ 3,059.00 EURO 245 34,208.30 $/N197.67 Collapse 

Nill 

Insurance can help fund befitting 

funerals for one’s parents 

P. 38 

NEWS YOU CAN TRUST I ** MONDAY 18 MAY 2015 I VOL. 13, NO 97 I NGN300 

FG to grant incentives to 

embedded power operators 

OLUSOLA BELLO 

The Federal Government 

favours granting 

incentives to the 

operators of embedded 

power generation 

in the country, in order to 

encourage further investment 

in the sector. 

The incentives would come 

in the form of tax holidays and 

cost reflective tariff, with a committment 

to removing encumbrances 

in the system. 

Chinedu Nebo, minister 

of Power disclosed this on the 

sideline of the official commissioning 

of the Niger Delta 

Power Holding NDPHC/NIPP 

330/132/33kv Oke Aro Transmission 

Substation in Lagos on 

Thursday. 

The idea of embedded power 

is coming more into focus because 

it is much easier and proficient 

to do several 20 megawatts 

power stations than one 200 

megawatts unit which would 

take between three and five years 

to build, Nebo added. 

An added advantage is 

that the smaller units can be 

deployed within a year, he 

further said. 

Nebo observed that embedded 

generation is the fastest way 

to bring electricity to Nigerians, 

adding that there is a policy 

which gives that direction for the 

scheme, and that what government 

is working on, is to provide 

incentives to investors because 

it is easier and more proficient 

to build small generating powers 

plants than big ones. 

Embedded power generation 

is a situation where a generator is 

directly connected to the distribution 

network. It is also a useful 

means of dedicating power 

to state and local government 

eligible customers and others. 

The parties involved would 

have to agree on a tariff to be 

paid, as distinct from the official 

electricity tariff. 

It would provide reliable 

supply of energy, critical for viable 

industrial activity. It would 

also minimise line losses and 

voltage sag, as closeness to load 

results in more efficient power 

transmission. 

Other qualities of embedded 

generation include substitute 

for main supply, source 

of power in areas without grid 

supply, and backup standby 

generation which ensures 

regular supply and provision 

Continues on page 4 

L-R: Uyi Akpata, senior country partner, PricewaterhouseCoopers; Mike Ikpoki, chief executive officer, MTN Nigeria, 

and Udom Inoyo, executive director, ExxonMobil, at the MTN Golf Tournament 2015 which was held at the Lakowe Golf 

course in Lagos at the weekend. 

BPP saves N99.192bn from contract awards in 2014 

ELIZABETH ARCHIBONG 

The nation’s procurement 

system saved N99.192 

billion from contracts 

awarded in 2014. 

The savings were from 229 

requests from 21 ministries, 

departments and agencies. The 

total requests were 298. 

This is contained in the latest 

reports of the Bureau for 

Public Procurement (BPP)) in 

which the agency noted that it 

certified contracts worth N1.409 

trillion for the 21 MDAs. Only 

the request by the Office of the 

Auditor-General of the Federation 

(OAGF) was endorsed with 

cuts. 

In 2013, the BPP made 

N57.951 billion in savings from 

contracts awarded to different 

sectors of the federation and 

gave certificate of no objections 

for contracts worth N1.118 trillion. 

The capital budget for the 

year 2014 was pegged at N1.119 

trillion, the disparity in the figure 

approved had been explained by 

Emeka Ezeh, director-general 

of the BPP, to include running 

projects. 

However, the amount saved 

from the requests made by different 

agencies of the federation 

in 2014 can be ploughed back 

into other parts of the economy. 

According to the Bureau’s 

2014 annual report obtained by 

our correspondent, of the savings 

made, the highest amount 

was recorded from the Federal 

Capital Territory Administration, 

a whopping N1.8 billion. 

The figure was saved from a 

request of N133.5 billion made 

by the administration for 39 projects, 

of which 35 were approved. 

The Bureau also saved the 

sum of N817.8 million from the 

N10.2 billion worth of contract 

requested by the Ministry of 

Environment for three projects. 

A total of N3.9 million was 

saved from the Ministry of 

Trade and Investment from the 

N480.4 million requested for 

two projects. 

The sum of N2.2 billion was 

saved from N20.7 billion re- 


Insurers Q1 earnings 

dip over non-renewal 

of FG group life 

insurance 

MODESTUS ANAESORONYE 

Insurance companies’ first 

quarter 2015 earnings have 

fallen short of projection, 

reflecting a tough business environment 

and the impact of 

the country’s recently concluded 

general elections, which slowed 

economic activity and created 

uncertainty in the business environment, 

BusinessDay investigations 

show. 

The insurance sector in Nigeria 

contributes barely 0.65 

percent to GDP and less than 1 

percent in penetration, making 

it the third largest in Africa with 

premium size of about N300 

billion as at the end of the 2014 

financial year. 

Analysts who spoke to BusinessDay 

over the poor outing of 

most insurance companies in 

their first quarter results, said the 

non-renewal of the Federal Government’s 

group life insurance 

and police insurance scheme 

in the first quarter, significantly 

affected the premium size of 

companies and the industry. 

The Federal Government’s 

group life insurance and the 

police insurance scheme account 

for nearly 10 percent of life 

insurance companies’ annual 

premium, and amounted to N9 

billion in the 2013 financial year, 

with the FG employee scheme 

accounting for N5.7 billion and 

police scheme N3.7 billion. 

As at April 30, 2015, twenty-six 

insurance companies out of 49 

Inside 


News 6 

Comment 10 

Editorial 12 

The Economist 14 

Business Intelligence 28 

Start-Up Digest 31 

City File 36 

Money 38 

Real Sector Watch 48

2 

Monday 18 May 2015

Monday 18 May 2015 

3


4 BUSINESS DAY 

NEWS 

Insurers Q1 earnings dip over non-renewal of... 

Continued from page 1 

registered firms had submitted 

their first quarter 2015 accounts 

to the National Insurance 

Commission (NAICOM), 

which reflected low premium 

as a result of poor business environment 

during the review 

period, when compared with 

the same period in 2014. 

An insurance CEO who 

preferred anonymity said no 

insurance company would 

meet its first quarter projection 

this yeas, as a result of 

poor business environment 

since the beginning of the year. 

“The postponement of the 

elections affected us most, 

because that was the peak of 

insurance renewal for the current 

year.” 

He added, “as soon as the 

elections were postponed 

many clients, both private 

and corporate, withdrew their 

interest and had to wait to see 

the outcome of the elections, 

and that affected our performance 

seriously.” 

The CEO, however said 

normalcy was returning to 

the business following the 

successful and peaceful conduct 

of the general elections, 

adding that the NNPC had 

just renewed its group life and 

consolidated insurance assets 

this quarter. 

“We are beginning to see 

business renewals now from 

individual and corporate clients 

and we hope we recover 

in the second quarter, to enable 

us meet our projection 

for the year. 

The Federal Government, 

through its consultant broker, 

had late December, issued 

credit notes to insurance companies 

for its employees group 

life insurance for 2015, but had 

to withdraw them five days 

later when it became clear that 

government was not going to 

release money for premium 

payment at that time. 

This however worsened 

when the political environment 

was heated up over electioneering, 

until now that a 

new government is coming in. 

Tosin Runsewe, chief client 

officer, Mansard Insurance 

plc, had earlier in the year, 

expressed concern over declining 

government revenue 

over falling oil prices and depreciation 

of the naira, which 

he observed might affect premium 

income of insurance 

companies. 

Also, Bola Temewo, president, 

Chartered Insurance 

Institute of Nigeria said there 

was no doubt that businesses 

had been facing hard times, 

particularly as the economy 

faced difficult times as result 

of dwindling oil prices, falling 

government revenues and 

depreciating value of the naira. 

L-R: Victor Onyenkpa, partner & head, tax regulatory and people services, KPMG; Gabriel Foluso Fasoto, past president, 

The Chartered Institute of Taxation of Nigeria (CITN); Mark Anthony Dike, president; James Kayode Naiyeju, past president, 

and Taiwo Oyedele, partner, tax & regulatory services, PwC, at the ongoing 17th annual tax conference with the theme 

‘Inclusive Economic Growth and Sustainable Development: Fiscal Imperatives, Prospects and Challenges’ in Abuja. 

Pic by Olawale Amoo 

FG to grant incentives to embedded power... 


of ancillary services such as 

voltage or frequency control. 

According to the minister, 

embedded generation is the 

key, and the commission has 

been directed by government 

to do all that is necessary to 

make the scheme work. 

Commenting on the importance 

of the commissioned 

transmission substation, Nebo 

said: “ The problem we always 

have is because we lack transmission 

infrastructure, there 

is so much congestion in the 

Lagos line”. 

He said it was necessary to 

expand capacity and create redundancy, 

so that current and 

voltage coming to Lagos would 

always be stable and reliable. 

“This gives relief to Ikeja 

West substation and makes 

it easier for very good quality 

power to get around to consumers”, 

he said. 

Vice President, Namadi 

Sambo who also is the chairman, 

board of directors of the 

Niger Delta Power Holding 

Company, said he was impressed 

by the gigantic power 

transmission infrastructure, 

Oke-Aro 330/132/33kV which 

also has a distribution leg for 

the benefit of the two states. 

Sambo further said : “Here 

in Oke- Aro today, we are witnessing 

another great feat of 

this administration in power 

infrastructure capacity expansion 

to boost economic and 

industrial development of the 

country. 

In Lagos, the two distribution 

companies.i.e Ikeja Electricity 

Distribution Company 

and Eko Electricity Distribution 

Company both accounted 

for over 40% of all power consumption 

in Nigeria. ” 

This according to him is 

understandable from the fact 

that Lagos, which used to be 

our political capital before the 

advent of Abuja, is still Nigeria’s 

commercial and industrial 

capital hub with a large 

concentration of industries 

located in the state and the 

adjoining Ogun state. 

“Prior to the advent of Oke 

Aro substation, there were only 

3nos 330/132/33kV substations 

in Lagos. One of these three,is 

Ikeja West 330/132/33kV Substation 

which was the major 

marshalling point for all power 

plant that flows its generation 

into Lagos, this development 

which had thrown the state 

into a state of great congestion 

with limited space for 

safe expansion of capacity for 

increased flows into Lagos 

and environs. All the 330kV 

power lines from the Benin 

and Oshogbo 330kV hubs of 

the national grid - which were 

also serving as evacuation lines 

for NIPP new power plants at 

Omotosho as well as Olorunsogo, 

terminated there. Even 

330kV evacuation lines for 

older major power plants such 

as Egbin in Lagos also terminated 

at Ikeja West”. 

BPP saves N99.192bn from contract awards... 


quests made by the Ministry of 

Police Affairs for four projects. 

Out of the N16.3 billion worth 

of contracts requested by the 

Ministry of Agriculture for nine 

projects, N2.7 billion was saved 

and seven projects approved. 

The Ministry of Transport 

made requests for N44.9 billion 

for 19 projects and savings of 

N2.044 billion was made from 

the requests. A total of N1.2 billion 

was saved from a request 

of N20.7 billion made by the 

Ministry of Water Resources for 

seven projects. 

The BPP also saved N257.3 

million from the Ministry of 

Women Affairs,from request of 

N816.9 million for two projects. 

Also N69 billion was saved from 

the Ministry of Works, from requests 

of N741.4 billion made 

for 47 projects, out of which 32 

were approved. 


saved from the Ministry of Niger 

Delta Affairs from the N111.6 

billion request made for 19 

projects. 

From the Ministry of Aviation, 

savings of N510.59 million were 

made from requests for N4.6 billion 

made for 18 projects, out of 

which 13 were approved. 

Also N333.5 million was saved 

from requests for N4.8 billion 

made for seven projects, while 

N1.041 billion was saved from 

requests of N14.3 billion made 

by the Ministry of Education for 

26 projects, of which 16 were 

approved. 

The finance ministry made a 

request for N151.323 billion for 

15 projects and N1.3 billion was 

saved. Furthermore, N64.4 million 

was saved from a request 

for N234.7 million made for ten 

projects by the Ministry of the 

Interior. Also,N26.480 million 

was saved from a N1.651 billion 

request made by the Ministry of 

Labour and productivity for two 

projects. 


saved from the Ministry of Petroleum 

from a request for N52.8 

billion made for eight projects, 

while N3.8 billion was saved 

from N49.3 billion requested 

by the power ministry for 53 

projects, out of which 21 were 

approved. 

N71.5 million was saved 

from the N645.5 million request 

made by the Ministry of Special 

Duties for five projects, while 

N1.1billion was saved from the 

N17.6 billion request made by 

the Office of the Secretary to the 

Government of the Federation 

for 12 projects. 


saved from the N11.4 billion 

requested by the Presidency for 

projects, out of which 39 were 

approved. 

Meanwhile, the Federal Executive 

Council in 2014 approved 

the award of a total of 

104 contracts to 12 sectors of 

the economy in the sum of N1.1 

trillion. 

The Ministry of Works had 

the highest number of contracts 

(30), followed by the 

Federal Capital Territory (16) 

while the federal ministries of 

environment, commerce and 

petroleum resources had one 

contract each. 

STANBIC IBTC MUTUAL FUNDS 

08/05/2015 

Stanbic IBTC Nigeria Equity Fund 

Offer price N8,957.42 

Bid price N 8,806.01 

Stanbic IBTC Ethical Fund 

Offer price N0.91 

Bid price N0.90 

Stanbic IBTC Guaranteed 

Investment Fund 



Stanbic IBTC Balanced Fund 

Offer price 

Bid price 

Stanbic IBTC Bond Fund 

N1,764.05 

N1,748.80 



Annualized Return 9.99% 

Stanbic IBTC Iman Fund 



Stanbic IBTC ETF 30 

Closing NAV Per Unit N106.71 

Stanbic IBTC Money Market Fund 

Yield 3.37% 06/05/15 

www.stanbicibtcassetmanagement.com 

“Past performance is not an 

Te1: +234 1 2801266 

indication of future performance”


5



NEWS 

MPC: Analysts see major policy rates remaining unchanged 

PDP says it won’t change identity 

…predicts further devaluation of naira after installation of new administration 

HOPE MOSES-ASHIKE 

As the Monetary 

Policy Committee 

(MPC) begins 

its meeting 

today to end 

tomorrow, analysts expect 

major policy rates to remain 

unchanged while predicting 

further devaluation of naira 

over time, after the installation 

of new administration. 

In the plethora of issues 

to be considered, the recent 

pressure on exchange rate, 

declining external reserves, 

rising price level and slowing 

domestic economic growth 

will likely take the centre 

stage, Ayodeji Ebo, head, 

investment research and his 

team of analysts at Afrinvest 

said in a report. 

Consequently, they voted 

for the MPC to retain MPR 

at 13%, public sector CRR at 

75%, private sector CRR at 

AMAKA ANAGOR 

20%, liquidity ratio at 30%, 

NOP at 0.5% and maintain 

status quo on exchange rate 

policy to allow the incoming 

administration settle 

down before grappling with 

any major monetary policy 

issue. 

The committee in the immediate 

past meetings has 

taken certain bold policy decisions 

relating to currency 

devaluation, Net Open Position 

(NOP) and the Monetary 

Policy Rate (MPR) in the 

light of daunting fiscal and 

monetary policy challenges. 

The RDAS (Retail Dutch 

Auction System) was closed 

in February 2015 while all 

demand for FX was directed 

to the interbank market even 

as the CBN continues to intervene 

intermittently at the 

interbank market to moderate 

volatility swings. 

The analysts noted that 

since the last MPC meeting 

that ended on March 24, 

2015, performance of the 

Nigerian financial market 

has been mixed with a divide 

between the period before 

and after the elections that 

was held on March 28, 2015. 

In the fixed income market, 

average bond yields rose 

to 15.4% before the elections. 

However, with the successful 

conduct and the attendant 

political risk moderation, 

bond yields currently trade 

on an average of 14.5 percent. 

The Afrinvest report indicated 

that financial system 

liquidity level has been on 

an increasing trend between 

the last MPC meeting and 

now. In March, average liquidity 

was at N207.9 billion 

while it declined to N233.2 

billion in April. Irrespective 

of the sustained hawkish 

policy stance of the CBN, 

liquidity level has been quite 

high in May with an average 

balance of N477.6 billion. 

Overnight and Open Buy 

Back (OBB) rates continue 

the usual oscillatory trajectory 

in response to the prevailing 

liquidity levels. 

According to the report, 

the foreign exchange rate 

at the interbank market has 

been trading at a tight band 

-- between N199.00/US$1.00 

and N199.75/US$1.00 - since 

March 2015. This is consequent 

on the elimination 

of RDAS window and the 

CBN’s intermittent interventions 

which shut out liquidity 

in the market even as 

demand remains in excess. 

The analysts believe the 

induced stability in the FX 

market may not be sustainable 

given the level of external 

reserves (US$29.7 billion) 

and reduced prospect 

for accrual with low level of 

crude oil prices. The external 

reserves which has fallen 

13.9% YTD can barely cover 

six months of import. 

L-R: Chidi Agbapu, co-CEO, Planet Capital Limited; Nnamdi J. Okonkwo, managing director, Fidelity Bank plc; Christopher 

Ezeh, chairman, Fidelity Bank plc and Tony Anonyai, co-CEO, Planet Capital, at the signing ceremony held recently for 

the offer for subscription of N30bn Fixed Rate Bonds issued by Fidelity Bank plc. Planet Capital acted as lead issuing 

house to the offer. 

Investor flags-off full construction of $729m marine, land-side infrastructure of Lekki Port 

Lekki Port LFTZ Enterprise 

(LPLE) has 

issued notice-toproceed 

to its engineering, 

procurement and 

construction (EPC) contractor, 

China Harbour Engineering 

LFTZ Enterprise, to 

commence full construction 

activities for Lekki Deep Seaport 

located at Lagos Free 

Trade Zone (LFTZ) in Ibeju- 

Lekki area of Lagos State. 

Lekki port, which will be 

the deepest seaport in sub- 

Sahara Africa with a draft of 

16.5 metres, is scheduled to 

become operational in 2019. 

“This is a major milestone 

on the project and 

it marks the beginning of 

the 41-month construction 

period for the largest maritime 

project in the country 

and we are flagging off the 

construction today by releasing 

an advance payment 

of $58.5 million to the contractor,” 

said Haresh Aswani, 

managing director of Lekki 

Port weekend in Lagos, during 

the notice-to-proceed 

ceremony. 

According to him, the 

total contract value for 

construction of all marine 

and land-side infrastructure 

for Lekki Port stands 

at USD$792 million while 

the total cost of this phase 

of the project is estimated at 

USD$1.65 billion. 

Aswani, who stated 

that the port facility when 

completed would have the 

capacity to handle postpanamax 

container vessels 

of about 10,000 Twenty 

Equivalent Units (TEU), 

added that the port will commence 

operations with annual 

throughput capacity 

of 1.5 million TEU, which is 

expected to rise to 2.7 million 

TEU. 

“The port will be 

equipped to handle around 

16.7 million metric tons of 

liquid cargo and 4.0 million 

metric tons of dry bulk cargo 

annually”, he stated. 

Stating that the completion 

of Lekki Port would 

help in solving the longstanding 

congestion problem 

currently existing at 

Apapa ports, Aswani noted 

that it will help in creating an 

enabling environment and 

spur massive investments 

along the free trade zone 

corridor including the entire 

Nigerian economy. 

He further disclosed that 

the port will generate direct 

and induced employment 

for about 170,000 persons 

and will have an economic 

impact of $361 billion over 

the concession period. 

While pledging its support 

for the project, Sanusi 

Lamido Ado Bayero, managing 

director of the Nigerian 

Ports Authority (NPA), who 

described the investment 

in Lekki Port as the much 

needed investment in the 

nation’s economy, stated 

that it will not only help in 

decongesting Apapa but will 

also create huge employment 

in the country. 

In a move aimed at encouraging 

more people 

to register in the statewide 

exercise, the Lagos 

State Residents’ Registration 

Agency (LASRRA) has 

begun mass distribution 

of residents’ cards to about 

three million residents so far 

registered since the exercise 

commenced more than one 

year ago. 

Olayinka Fashola, the 

general manager of LASR- 

RA, told journalists at the 

weekend that the distribution 

starting with the state 

civil servants was expected 

to take care of fourteen thousand 

workers and proceed in 

phases. 

“Before anyone comes 

up to collect his permanent 

resident card (PRC), he/she 

RAZAQ AYINLA, Abeokuta 

Conscious of environmental 

hazards 

inherent in 

blasting and mining 

limestone around the 

limestone belts in Ewekoro 

Local Government Area of 

Ogun State, Lafarge WAPCO 

Operations, an operational 

business of Lafarge Africa, 

has begun construction of 

housing units for the relocation 

of about 1,000 people in 

its host community. 

The construction of 

housing units (first phase) 

and other agreed facilities 

for the entire people of Oke- 

Oko, Sekoni, one of Lafarge 

WAPCO’s host communities 

OWEDE AGBAJILEKE, Abuja 

As the ruling People’s 

Democratic Party 

(PDP) is set to assume 

the new status 

of an opposition party 

come May 29, the party has 

ruled out changing its identity. 

To this end, the party 

has insisted that it is still the 

truly national political party 

with strength and spread to 

regain pre-eminence. 

It, therefore, stated that 

it is not contemplating a 

change of identity, noting 

that the unassailable vision 

of its founding fathers remains 

timeless in building 

a Nigeria of the collective 

wish and aspirations of all 

citizens. 

A statement by Olisa 

Metuh, the national publicity 

secretary of the PDP, 

on Sunday said that having 

been the guardian of Nigerian 

democracy for 16 years 

during which it nurtured 

and blossomed democratic 

governance as well as etched 

its name in the pantheon of 

good governance “the PDP 

will not in the circumstance 

of ephemeral loss of power 

change its identity or its 

time-honoured characteristic 

values”. 

The party said though it 

is resolutely committed to its 

present structures, it would 

not close its doors to other 

political parties wishing to 

be assimilated into its fold as 

the best vehicle for the fulfillment 

of political aspirations 

of all Nigerians regardless of 

tribe and religion. 

“We have a name, tradition 

and values. 16 fruitful 

years as the guardian of 

Nigerian democracy cannot 

be nullified by the reason of 

temporary setback. We shall 

rise beyond all and regain 

our rhythm. Our colour remains 

green, white and red 

and power still belongs to 

the people. And to assert that 

we are proud of the successes 

of our successive leaders 

in taking Nigeria to its present 

height is an understatement, 

which the passage of 

the next four years under the 

APC will certainly prove”, the 

party said. 

It added that the fact that 

the PDP is going into opposition 

would not mitigate 

its ability as the flagship of 

democracy, maintaining 

that it will soar higher in 

proving credible alternative 

as a constructive opposition. 

Lagos begins mass distribution of residents’ cards 

would have been sent a short 

message to that effect. And 

in the message, such person 

will be told where to go for 

the collection of the card. 

And this marks the expiration 

of the registration life 

circle. 

“And for today, we will be 

distributing cards mainly to 

the civil servants. And that 

was why we have decided to 

organise it here. At the end 

of the day, we will be moving 

to the auditorium within the 

secretariat, also to distribute 

the cards. And this will elapse 

at the end of this month. 

“Beginning from June, 

the cards will be transferred 

to the local councils. This 

we believe will bring the 

card closer to their owners,” 

Fashola said on Friday. 

Lafarge begins housing units 

construction for host community in Ogun 

in Ewekoro on 60 acres of 

land, was conceived by the 

cement company to relocate 

the people to a more 

environment-friendly place 

where blasting and mining 

of limestone would not affect 

them. 

Speaking at the inauguration 

of housing facilities 

held at new Oke-Oko, 

Sekoni in Ewekoro recently, 

Adepeju Adebajo, managing 

director, Lafarge Africa, 

disclosed that the relocation 

of the people and their 

deities was initiated by the 

management to secure its 

host community from the 

environmental hazards of 

limestone blasting and mining.


7

8 

Monday 18 May 2015


9



COMMENT 

comment is free 

Send 800word comments to comment@businessdayonline.com 

IN THE NATION 

KAYODE SOREMEKUN 

Prof Soremekun, a previous Ford 

Foundation, Fulbright and Rockefeller 

scholar, is a Visiting Member of the 

Editorial Board, BusinessDay. 

GREGORY KRONSTEN 

Gregory Kronsten, Associate Director 

Head, Macroeconomic & Fixed 

Income Research, FBN Capital 

We still have to contain 

ourselves for ten days 

before the formal 

handover to the new 

administration, and thereafter for 

the first indications of fiscal policy 

and for ministerial appointments. 

This is the downside of the US-style 

lengthy period of transition. We 

will assume: that the APC has no 

issues with the Fiscal Responsibility 

Act of 2007; that therefore it is 

not going to indulge in a borrowing 

spree to meet its spending commitments; 

and that it will not increase 

direct tax rates on individuals or 

companies outside the oil sector. 

Gross federally collectible revenue 

amounted to N10.19trn in 2014 

(vs N10.89trn in the year’s budget), 

and is projected at N9.78trn in 

the 2015 budget approved by the 

National Assembly (but awaiting 

the presidential sign-off). The APC 

has a revenue gap to fill before its 

manifesto pledges to low-income 

Nigerians. 

The reaper in the tower 

spective on History. As scholars, 

what they encountered as History 

was a condescending attitude on 

the part of western scholars. According 

to such western scholars, 

Africa had no history before the 

coming of the white man. But 

these two scholars along with 

their peers said no! Therefore, 

they brought into play a novel 

historiography which, among 

other things, stressed oral history. 

In the process, a new corpus of 

knowledge was built up and the 

Trevor-Ropers of this world were 

given a much more comprehensive 

insight and education about 

the notions and methods of African 

History. 

Specifically, Ajayi edited, with 

lan Espie, A Thousand Years of 

West African History. In this work, 

Ajayi and his colleagues impressively 

demonstrated that an authentic 

African past existed before 

the Caucasians came calling. As 

regards Ayandele, it is apposite to 

recall his groundbreaking work, 

The Educated Elite and the Nigeria 

Society. 

In a rather interesting and 

revealing way, Ayandele showed 

up a unique situation in which 

the supposed dregs of society, 

who were taken away as slaves, 

eventually returned to the Nigerian 

space, with new skills and 

attitudes which enabled them to 

dominate the Nigerian society. 

He went on to demonstrate how 

education has in fact been used as 

a tool of exploitation of the Nigerian 

society, rather than as an instrument 

of emancipation. These thoughts 

could well have been uppermost in 

the mind of this historian who, after 

a thoughtful examination of the 

various sub-national groups in Cross 

River State, declared that this was an 

atomistic society that was perpetually 

at war with itself. In a Freudian 

way perhaps, Ayandele could have 

been speaking about the entire Nigerian 

social formation itself. 

Beyond the core indices of teaching 

and research in academia, these 

two historians also played prime 

roles in university management 

at the highest levels. Ayandele’s 

pioneering role at the University 

of Calabar will continue to be remembered 

and cherished by all the 

stakeholders of higher education 

in Nigeria. As an Ogbomoso man, 

he was certainly not in his own primordial 

territory. But times have 

changed and not necessarily for 

the better. Universities have since 

become mere ethnic enclaves in 

which the post of vice-chancellor 

is reserved for the son of the soil. 

It is arguable here that this 

ethnic flavour or sheer ignorance 

could well be responsible for the 

rather muted response to the passage 

of another intellectual icon, 

Professor Nwokolo. Nwokolo was 

a Professor of Medicine at the 

University of Nigeria, Nsukka. On 

reading the obituaries of this accomplished 

academic, it was evident 

that in the medical profession, 

Nwokolo served the entire country. 

This was clearly evident from the 

advertisement put out by the Nigerian 

National Post-Graduate Medical 

College. Hundreds of Nigerian 

medical doctors across the country 

benefitted from his tutelage and 

forensic profile as a lecturer and 

examiner in the area of Medicine. 

News also filtered in that another 

Nigerian academic, a sociologist, 

Professor Dayo Akeredolu-Ale, 

also passed on. In these times, 

entrepreneurship happens to be 

the buzz-word. But a measure of 

amnesia exists here. It is hardly 

remembered that the scholarship 

on entrepreneurship was largely 

pioneered by Akeredolu-Ale. 

Perhaps the most numbing dimension 

of this narrative relates to 

the demise of Professor Adekunle 

Amuwo. Compared to the other 

Understandably, we 

have all been consumed 

by the elections 

and their aftermath. 

In the process, 

we have lost sight of other news 

items which ought to engage our attention. 

My specific reference here 

is to the spate of deaths that has 

besieged the Nigerian university 

system. The reaper has certainly 

been busy in the Ivory Tower. The 

departed vessels of knowledge 

include Professors Ade Ajayi, Emmanuel 

Ayandele, Nwokolo, Dayo 

Akeredolu-Ale and, much more 

recently, Adekunle Amuwo. 

In various ways, these individuals 

served meritoriously in our first 

generation universities. The first 

two, i.e., Ajayi and Ayandele, were 

leading members of the Ibadan 

School of History. It was indeed a 

School, because these two historians 

along with their contemporaries 

espoused an Afro-centric perprofessors, 

he was relatively young. 

He died rather early at the age of 

59. Since we are in the same generation, 

I am more familiar with 

him. Kunle, as he was popularly 

known in academic circles, was 

vibrant, full of energy, and earnest 

about the Nigerian condition or 

non-condition! The latter variable 

could have been responsible for his 

early demise. 

Kunle Amuwo virtually left the 

University of Ibadan in a huff. He 

subsequently moved on to a variety 

of academic jobs in Southern 

Africa before settling in at the 

Brussels-based, International 

Crisis Group (ICG) from where 

he headed to Covenant University 

(CU), Ota. It was in CU that he died 

a week ago. He was a worthy intellectual 

sparring partner. Certainly, 

the intellectual community within 

and outside Nigeria will miss this 

great scholar. 

Taken together, Professors 

Ajayi, Ayandele, Nwokolo, Akeredolu-Ale 

and Amuwo in their 

respective ways nurtured the tree 

of knowledge in Nigeria and the 

wider world. May their souls find 

peace in the beyond and may the 

good Lord in his infinite mercies 

comfort and protect their primary 

and secondary relatives. 

Send reactions to: 

comment@businessdayonline.com 

Ten days to go, and then some fiscal colour to the pledges of change 

We will step around the minefield 

that is the payment by the 

NNPC of its dues to the federation 

account. This is dangerous territory. 

The emir of Kano and former 

governor of the CBN, Sanusi 

Lamido Sanusi, has ensured that 

the subject remains topical with 

his measured contribution last 

Thursday to the Financial Times. 

Public relations people have 

suggested that the new administration 

produces a short audit of 

the NNPC’s finances soon after 

assuming office as a statement 

of intent. 

Another powerful message 

would be the removal of the 

remaining fuel subsidies. Local 

media sources report that 

employees of the Subsidy Reinvestment 

and Empowerment 

Programme (SURE-P) are being 

laid off. This would tell most observers 

that there will no longer be 

any subsides to reinvest. The 2015 

budget has N143bn for subsidy 

payments; even with deregulation, 

this allocation is too low 

because of payments arrears to 

the marketing companies. One 

broader point is that deregulation 

would be, at best, fiscally 

neutral because the FGN would 

have to offer some palliatives in 

compensation so as to “sell” the 

idea to the public and avoid the 

about-turn forced upon the PDP 

government in January 2012. 

There is a bolder step involved, 

As scholars, what they 

encountered as History was 

a condescending attitude 

on the part of western 

scholars. According to such 

western scholars, Africa had 

no history before the coming 

of the white man. But 

these two scholars along 

with their peers said no 

too. The outgoing administration 

established SURE-P, stressing both 

its autonomy and the standing of 

its top officials. The underlying message 

was that Nigerians might have 

little faith in their elected government 

but that they could trust such a 

standalone body. The removal of the 

programme (and other comparable 

bodies) invites Nigerians to give the 

government and the public sector 

the benefit of the doubt. 

This is our personal take. Members 

of the Buhari camp have, 

however, given the impression that 

supervision and regulation across 

the economy will be enhanced. Government 

agencies could be merged 

but given sharper teeth, and standards 

of governance would improve 

in the process. 

The slide in the oil price and the 

failure of the FGN to build substantial 

fiscal buffers have highlighted 

the paucity of non-oil revenue 

collection, which totalled N3.4trn 

(gross) in 2014 or 3.8 per cent of 

GDP. Rather than increase direct 

tax rates, the new administration 

may focus on collection and the 

strengthening of the revenue agencies. 

Leaving aside the size of the 

informal sector, too few companies 

are paying their taxes. MTN Nigeria 

has said that its contributions across 

all tiers of government represent 10 

per cent of total non-oil collection. 

Broadening the base requires 

more and better paid staff but also 

a hearts and minds campaign. A 

former governor of the South African 

Reserve Bank told us that in 

his country contract awards in the 

public sector above a low threshold 

were conditional upon the receipt 

of a statement from the revenue 

services that the beneficiary was 

current with their tax obligations. 

Faced with the loss of contracts 

which are often the core of their 

business, the vast majority of 

companies would pay their taxes 

and obtain a bona fide certificate 

of compliance. 

On the cutting of wasteful expenditure, 

the outgoing government 

has already made savings by 

the elimination of ghost workers 

and pensioners, and by tighter 

procurement procedures. The APC 

in power is expected to prune the 

number of public agencies and 

implement the recommendations 

of the Oronsaye report. Changes in 

the law are required in many cases. 

Research by BusinessDay in December 

2014 found that senators 

receive the equivalent of US$2.1m 

annually including allowances. In 

a global context this does not look 

good, and Nigerians may have 

objections on value-for-money 

grounds. In this extreme case, the 

legislators themselves would have 

to agree to a change (reduction). 

Asset sales are another form of 

deficit financing, and have been 

little aired in crystal ball gazing 

beyond 28 May. We would value 

greater transparency. A recent 

CBN press release corrected a local 

media report on FGN spending in 

H2 2014 and noted that the deficit 

in the period was “financed mostly 

from privatization proceeds”. Some 

colour would have been welcome. 

As to possible sales, the Buhari 

camp has been quiet although the 

current CBN governor, Godwin 

Emefiele, has floated the possibility 

that the FGN sells some or all 

of the NNPC stake in the unincorporated 

joint ventures with the 

oil majors. Still on the oil sector, 

whenever the petroleum industry 

bill is passed in some form, the 

FGN could hold the first bidding 

round for new acreage since 2007 

and generate some signature bonuses 

for deficit financing. 

As we wait impatiently for the 

handover and the strands of the 

new fiscal policy, we would stress 

one constraint that receives little 

attention. If the APC is to deliver 

a good part of its pledges, it has 

to work closely with a productive 

assembly. For most of the past 

four years, the presidency and the 

majority in both houses belonged 

to the same party. The assembly’s 

agenda, however, was often driven 

by its institutional rather than its 

party political loyalties. This did 

not solely emerge in the annual toings 

and fro-ings over the budget. 


comment@businessdayonline.com


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BUSINESS DAY 

Life after school – The sublime hot pursuit of excellence 

11 

COMMENT 

J.K RANDLE 

Randle is Chairman/Chief Executive JK 

Randle Professional Services 

Chartered Accountants. 

Let me make it perfectly 

clear at the outset that I 

make no claim whatever 

to any medical qualifications. 

It was my grandfather 

Dr. J.K. Randle who was one of 

our nation’s pioneer medical practitioners. 

I am a chartered accountant 

by profession and I cannot fail to 

recognize that my grandfather had to 

his credit scholarships and endowments 

which he bequeathed in 1928 

for the study of medicine. However, 

on the debit side was his insistence 

that all his children should study 

medicine or forfeit their inheritance! 

My father, J.K. Randle, opted out and 

I fully endorse his choice. 

All the same, I am most grateful to 

the Lagos Teaching Hospital for inviting 

me to deliver today’s lecture to 

the graduating students of: (i) School 

of Community Health Officers Training; 

(ii) School of Health Information 

Management; (iii) School of Medical 

Laboratory Sciences; (iv) School of 

Medical/Psychiatry Social Work; (v) 

School of Midwifery; (vi) School of 

Nursing; (vii) School of Post-Basic 

Nursing; and (viii) School of Basic 

Dental Nursing. 

About ten years ago I was similarly 

honoured to be invited to deliver 

the Oritsejolomi Thomas Memorial 

Lecture in honour of the first Provost 

of the College of Medicine/Medical 

Director of the Lagos Teaching 

Hospital. On that occasion I was 

not rewarded with a doctorate but 

I hope I shall fare better this time! 

Permit me to heartily congratulate 

the students who are graduating 

after acquiring vital skills and critical 

knowledge as well as having been 

found worthy in CHARACTER. 

However, it is not enough to commend 

the students. We must also 

acknowledge and applaud their 

teachers for their commitment and 

determination to do the medical 

profession proud (albeit at a somewhat 

subsidiary level) while at the 

same time rescuing our beloved 

nation from the crass ignorance of 

the vital role played by those whose 

destiny is to support the doctors, 

surgeons, pharmacists, opticians, 

etc who are the “generals” of the 

medical profession. My dentist is 

in the audience and he insists that 

I must add dentists to the exclusive 

list of angels or face his wrath at our 

next encounter as regards which he 

has confirmed my appointment for 

noon on Wednesday of next week. I 

bow to the dictates of self-preservation 

and I am ready to hail dentists 

as super-angels! 

At the risk of repeating what your 

remarkable teachers, lecturers and 

professors would already have told 

you, I must nevertheless remind you 

that the past is not the future. Hence, 

your focus should be on the future, 

not the past. 

It is not unlikely that your sojourn 

in the various schools under 

the umbrella and protection of 

Lagos Teaching Hospital would have 

provided you with a considerable 

measure of order, peace, and tranquillity 

in a secure (almost insular/insulated) 

environment. Now, as you venture 

into the world of harsh realities, 

you must craft a vision of the future 

you desire for your own self-fulfilment 

and actualize it by ensuring that it is 

driven by the right strategy which will 

inevitably involve making sacrifices 

now in order to reap a bountiful harvest 

later as you progress on the ladder 

of achievements and success. I must 

however warn that the competition is 

waiting to snare and frustrate you by 

dangling the temptation of settling 

for less than what you deserve. This is 

sometimes euphemistically ascribed 

to a new genre now known as “Stomach 

Infrastructure”. The first casualties 

of that fatal choice are morality and 

self-respect. After stomach infrastructure 

which is always a moving lowest 

Nigeria is too poor for our 

leaders to act like multibillionaires, 

and Nigeria 

is too rich for the people 

to be poor. When you 

seek public office, you 

seek it to serve and lead 

by example. You don’t 

seek public office to play 

lord over the people who 

voted you into office 

common denominator anyway, 

what would be left is a gaping hole of 

unfulfilled ambition and legitimate 

aspiration to make your own unique 

contribution to building a better nation 

where nobody is permanently 

oppressed, marginalized or violated 

on account of their ethnicity, religion 

or gender. Your teachers are entitled 

to believe that they have sufficiently 

equipped you to go beyond the limit 

and thereby surpass them. That is 

the best reward you can give them 

in appreciation of their diligence, 

resourcefulness and care. 

Perhaps, I should share with you 

the verdict recently delivered by 

the European Union [EU]. Michel 

Arion, the EU Ambassador and 

Head of Delegation to Nigeria and 

ECOWAS, was quoted as follows: 

“Nigeria is a rich country, but Nigerians 

are regrettably poor. It is a 

rich country that should not depend 

on aid from foreign donors. I think 

government at all levels in Nigeria 

should ponder. To really develop 

the Nigerian economy in a sustainable 

way, the core issue will be to 

redistribute social benefits through 

fiscal measures, particularly taxation 

and social measures, using safety 

nets. Strengthening the institutions 

is absolutely key in this regard. In 

the North, development indicators 

in the area are unacceptably worse.” 

We must accommodate the sanguine 

commentary of Yemi Adebowale: 

“Arion is absolutely right. We all 

know this. The EU Ambassador is 

not telling us anything new. We are 

all aware of the rich resources of this 

country. Unfortunately, corruption 

and inept leadership have made it 

impossible for this country to attain 

its full potentials. In the last 32 years, 

we have simply been moving round 

in a cycle (circle), from one inept 

administration to the other. I have 

my fears that we would most likely 

be doing the same thing in the next 

four years. The handwriting is already 

on the wall.” 

We should also create space for 

the intervention of newly elected 

senator, Ben Murray-Bruce: “Nigeria 

is too poor for our leaders to act like 

multi-billionaires, and Nigeria is too 

rich for the people to be poor. When 

you seek public office, you seek it to 

serve and lead by example. You don’t 

seek public office to play lord over the 

people who voted you into office. The 

leadership of Nigeria is consuming all 

the resources of our people and leaving 

the rest of us in abject poverty.” 

Before we close the circle, we 

should create room for the feisty 

avowal of Edwin Clark. I refer to the 

front page publication of Saturday 

Punch of April 13, 2015. Headline: “I 

WON’T DIE BECAUSE JONATHAN 

LOST ELECTION – Clark”. 

We are entitled to extract the 

right lessons from the observations 

of Clark, especially with regard to 

“Why should I die?” We must not be 

selfish. Rather we should expand the 

space sufficiently to accommodate a 

question that must be of particular 

interest to you all: “Why must patients 

die?” To my mind, the answer lies in 

the zeal with which we address the 

Sublime Hot Pursuit of Excellence. 


comment@businessdayonline.com 

Britain embraces federalism... 

Continued from back page 

Clegg, resigned immediately. 

Both parties are now looking for new 

leaders. 

Now, what factors shaped the outcome 

of the general election? Well, a 

lot of forces were at work. First, a key 

cause of Labour’s downfall was its 

poor reputations on economic management 

and leadership. David Cameron 

was miles ahead of Ed Miliband 

on the two critical questions: who is 

better able to manage the economy? 

And who is a more credible leader? 

The truth is that, despite the painful 

austerity measures, the economy has 

done reasonably well under Cameron’s 

leadership, with unemployment 

below 6 percent and inflation at 

zero percent. By contrast, Labour was 

widely blamed for amassing huge 

debt and deficit when they were last 

in power. The Tories used this against 

Labour to devastating effect. For instance, 

everywhere David Cameron 

went during the election campaign 

he brandished a note left behind by a 

former Labour finance minister, who 

wrote: “I’m afraid there is no money”. 

Cameron used this note to argue that 

Labour was reckless with the public 

finances while in power and couldn’t 

be trusted again on the economy. 

And it worked. British voters dislike 

parties that are fiscally irresponsible! 

Furthermore, Miliband was seen 

as anti-business and too left wing. 

He did not appeal to business and 

aspirational voters. 

However, the second, perhaps 

more powerful, cause of Labour’s 

failure was the effect of Scottish and 

English nationalisms. Last year, the 

Scottish people voted 55.3 percent to 

44.7 percent against independence 

from the UK. Instead, they decided 

that Scotland should have a strong 

voice in Westminster. In other words, 

they wanted MPs who would fight 

the Scottish corner aggressively in 

London. And the only party they felt 

could provide this robust and aggressive 

representation was the SNP, 

which has been stridently against 

Scotland being governed from London. 

Thus, Labour became the victim 

of Scottish nationalism by losing 

all but 1 of its 41 seats in Scotland! 

At the same time, however, the fear 

that SNP MPs would “invade” London 

and prop up a minority Labour 

government, as the SNP promised, 

stoked English nationalism. Many 

English voters believed that a Labour 

government supported by Scottish 

nationalists who wanted to break 

up the UK would not be legitimate. 

It is estimated that about 2 percent 

of English voters switched, at the last 

minute, to the Conservative party 

to prevent a Labour government, 

supported by the SNP. Even the UK 

Independence Party (UKIP) eroded 

Labour support in England because 

of the fear of a minority Labour 

government propped up by the SNP, 

although UKIP also capitalised on 

Labour’s perceived weak record on 

immigration. So, in the end, Labour 

lost heavily because of its poor ratings 

on economic competence and 

leadership, and also because of rival 

nationalisms: the English and the 

Scottish! 

As for the Lib-Dem, their massive 

defeat was of a cruel nature. They had 

gone into coalition with the Conservative 

party in 2010 to help stabilise 

the country, given the Tories couldn’t 

govern alone. But Lib-Dem supporters 

hated the alliance, which wasn’t 

helped by the fact that the party later 

broke its promise not to support any 

increase in tuition fees. Of course, 

in any coalition, the small parties always 

get slaughtered when things go 

wrong. So, the Lib-Dem paid a heavy 

price for going into alliance with the 

Conservative party, and for breaking 

their election promises. 

The key issue about the May 7 general 

election, however, is the central 

role that nationalisms played in it, and 

the implications of this. For instance, 

no one can ignore what happened in 

Scotland, as the SNP leader Nicola 

Sturgeon has loudly stated! Almost 

everyone now agrees there should 

be a new constitutional settlement. 

The influential Times of London recently 

called for a “full constitutional 

convention” to agree a new relationship 

between the nations of the UK. 

And a growing number of influential 

politicians think federalism is now the 

only way of keeping the UK intact. For 

instance, the Mayor of London, Boris 

Johnson, believed to be the next Tory 

leader after Cameron, said that “there 

must be some federal structure”. One 

Scottish leader and elder statesman, 

Lord Owen, even put it more starkly: 

“Many Scottish people are ready to 

vote for separation unless they are 

presented with a new constitutional 

federal structure for the UK that 

allows Scotland to feel the fullest 

autonomy of nationhood within a 

federal state”. Few, indeed, believe 

things can be the same again in the 

UK, constitutionally and politically, 

after the seismic nature of the election. 

More significantly, the re-elected 

Tory Prime Minister David Cameron 

gets the message. As he put it in a 

statement after his re-election, “We 

must bring together the different 

nations of our United Kingdom. With 

our plans, the governments of these 

nations will become more powerful, 

with wider responsibilities”. He 

added, “In Scotland, our plans are 

to create the strongest devolved 

government anywhere in the world 

.… And no constitutional settlement 

will be complete, if it did not offer, 

also, fairness to England”. In other 

words, the proposed constitutional 

settlement would mean a significant 

devolution of powers to the four nations 

of the UK – England, Scotland, 

Wales, and Northern Ireland. It 

would mean, in effect, a federal UK! 

There are three lessons for Nigeria 

from the momentous British 

events. First, economic competence 

and leadership matter in elections. 

In 1992, when running for the US 

presidency, Bill Clinton coined the 

phrase: “It’s the economy, stupid!” 

That statement has been quoted 

endlessly. And it’s true! For instance, 

General Buhari won the presidency 

because President Jonathan was 

widely perceived to be weak on the 

economy and on leadership. Of 

course, it’s now Buhari’s turn to demonstrate 

economic competence and 

leadership in running the country. If 

he fails, his party would struggle with 

re-election in 2019. 

Secondly, small parties in coalitions 

always get slaughtered, a lesson 

for the APC South West. The APC is a 

grand coalition of different parties, 

but it’s the alliance between the North 

and the South West that won the party 

the presidency. APC South West is 

clearly a junior party in the coalition, 

with just four states, yet it was the king 

maker. If the Buhari government fails 

to deliver on the party’s promises, 

APC South West would pay a heavy 

price. It would suffer the same fate 

as the Lib-Dem if its alliance with 

the North did not produce tangible 

results for Nigerians or, for that matter, 

left the Yorubas dissatisfied. 

Finally, as I wrote recently in an 

article titled “A vision for the united 

nations of Nigeria”, ethnic nationalism 

is as strong in Nigeria as it is in the UK. 

Clearly, if the UK, a very conservative 

country, is moving towards a new 

constitutional settlement based on a 

federal structure, Nigeria has no excuse 

for ducking the issue. If General 

Buhari rejects the report of Jonathan’s 

National Conference, he should 

convene his own constitutional convention 

to agree a new political and 

constitutional settlement for Nigeria. 

The issue will not go away!



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Nigeria’s next petroleum minister 

It is no longer a secret 

that the Nigerian economy 

depends so much 

on hydrocarbon resources. 

The statistics 

over the years have remained 

the same: about 85 percent of 

the country’s earnings and 

over 90 percent of its foreign 

exchange come from the oil 

and gas industry. 

While the talking points 

over the years have been on 

how to diversify the economy, 

it is also critical that the 

oil and gas sector is wellmanaged 

at this point in time 

that the country seems to be 

moving towards a national 

rebirth. That is why stakeholders 

in the oil and gas 

industry as well as watchers 

of the economy are watching 

with keen interest to see who 

will emerge as Nigeria’s next 

petroleum minister. 

Expectations are that Nigeria’s 

next petroleum minister 

should be an experienced, 

thorough-bred technocrat 

who is deeply knowledgeable 

about the industry, with no 

baggage of any sort. There 

is also the need to reverse 

the trend whereby the role 

of group managing director 

(GMD) of the Nigerian National 

Petroleum Corporation 

(NNPC) has been diminished 

by “successive powerhungry 

petroleum ministers”. 

This is why we agree with 

the Centre for Petroleum 

Information (CPI) which said 

in a recent commentary that Nigeria’s 

next petroleum minister 

“should be charismatic enough 

in the international circuit and 

yet very effective in the domestic 

front”, “should be focused 

on shaping and giving bite to 

policies rather than competing 

with NNPC GMD for day-to-day 

operational duties”, and “must 

be reputable, visionary, deeply 

knowledgeable about the industry, 

experienced, not conflicted 

in any way, and very patriotic”. 

We also agree with Emeka 

Ene, chairman of the Society 

of Petroleum Engineers (SPE), 

Nigeria Council, that the oil 

and gas industry in the coming 

dispensation should be driven 

by technocrats. According to 

Ene, “The Nigerian oil and gas 

industry is a complex industry 

and therefore requires complex 

solutions by experienced hands 

and technocrats. Technocrats 

will be in the position to look 

at the investment flows, match 

them with the technology flows, 

the local content requirement 

as well as the inherent demands 

that are not just demands for the 

rights of the stakeholders.” 

Without a doubt, given the 

mounting high expectations of 

Nigerians on the incoming Buhari 

administration, one clear 

route of getting things done right 

is putting in place a minister of 

petroleum with enough strong 

will and determination to push 

through policies and initiatives. 

Such policies will include the 

issues of correct pricing and 

subsidy on petroleum products. 

This may be the first acid test 

that the Buhari administration 

will have to confront. 

At the industry level, the next 

petroleum minister will have to 

guide President Buhari on legal 

and fiscal framework regarding 

the industry, key among 

which is what to do with the 

draft Petroleum Industry Bill. 

BusinessDay has argued in a 

previous editorial that one way 

out could be to do away with the 

largely controversial bill and 

seek other ways of moving the 

industry forward. 

The incoming petroleum 

minister must, within the shortest 

possible time, decide what 

to do with Nigeria’s comatose 

refineries – whether to privatise 

them or carry out a real turnaround 

within a given timeframe 

to get them back on their feet. 

The minister must also brace up 

to the challenge of tackling the 

issue of allocation of oil blocks 

and bid rounds in a transparent 

manner using global best 

practices. We recall here the 

botched second marginal fields 

bid round which fizzled out after 

so much noise. 

Furthermore, the next petroleum 

minister should chart 

a way forward for the gas sector 

and ensure that the gas master 

plan is implemented to the fullest 

and also have a foothold on 

the issue of gas flaring. 


some years ago initiated a policy 

to boost Nigeria’s crude reserves 

to 40 billion barrels by 2010 and 

hit 4 million barrels per day of 

crude oil production. However, 

the country has stagnated at a 

reserve base of 36 billion barrels 

with daily crude oil production 

hovering under 2 million barrels. 

The petroleum minister 

Nigeria needs at the moment 

should devise creative incentives 

and ways of funding Joint 

Venture operations to ensure 

that we grow our reserves and 

also increase our production 

output. 

Another nagging issue is the 

minister’s consent. While some 

stakeholders accept that obtaining 

the minister’s consent 

is desirable prior to completing 

certain transactions in this very 

important industry, it is our 

view that it is also important to 

have clearer rules beyond the 

Petroleum Act as regards timing 

for the grant of consent. This is 

because delays in the granting 

of consent, which could be 

upwards of two years, can pose 

a huge drawback to oil and gas 

transactions. 

We, therefore, urge the incoming 

Buhari administration 

to take these issues into 

consideration in selecting the 

next petroleum minister and 

ensure that it puts a round peg 

in a round hole in order to move 

the nation’s oil and gas sector 

forward. 

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EDITORIAL ADVISORY BOARD 

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Tunji Adegbesan 

Eyo Ekpo


13



In Association With 

Business 

The oil industry 

After OPEC 

American shale firms are now the oil market’s swing 

producers 

BIG companies making 

big bets on big 

oilfields, while a cartel 

of oil-producing 

states fixed the price 

to keep itself rich and others, 

including the oil majors, profitable. 

That, in caricature, was 

how the oil industry once ran. 

That model now seems broken. 

On May 13th the International 

Energy Agency, representing 

the main oil-consuming 

countries, said a global oil glut 

was building, as Saudi Arabia 

pumped oil frantically in 

a continuing battle for market 

share with American shale-oil 

producers. The shale firms have 

proved a lot more resilient, and 

a lot more productive, than the 

Saudis and other members of 

OPEC, the producers’ cartel, 

had expected. Last November, 

with prices already slipping, 

OPEC’s members stopped trying 

to agree production quotas 

among themselves, sending 

crude tumbling further. Their 

hope was that this would force 

rival producers, especially in the 

American shale beds, to slash 

investment. As supply tightened 

drastically, the oil price would 

rebound. This has not happened. 

Prices have staged only 

a partial recovery: West Texas 

Intermediate (WTI), one of the 

main benchmark prices for 

crude, was just above $100 a year 

ago and hit a low of around $44 

in March; it had recovered to just 

$60 by the middle of this week. 

If the glut persists, the price is 

likely to slip back. As OPEC oil 

ministers prepare for a meeting 

in Vienna next month, a draft 

paper leaked to the Wall Street 

Journal said that even in its most 

optimistic scenario, the price 

will not exceed $76 a barrel until 

after 2025. It also considered a 

scenario in which it fell below 

$40. OPEC denied that the draft 

existed, but the conclusions ring 

true: the chances of a return to 

triple-digit crude prices look 

slim. 

The big oil multinationals, 

such as BP, Chevron, Exxon- 

Mobil, Shell and Total, have responded 

to the weaker oil price 

by cost-cutting, and postponing 

and cancelling some of their 

exploration projects (although 

Shell this week got a provisional 

go-ahead to restart a $6 billion 

project in the Arctic, troubled by 

delays and accidents). However, 

the output of the shale firms has 

proved surprisingly robust, even 

though they have cut their number 

of rigs significantly since the 

peak last October. 

One reason for this is canny 

hedging by some shale producers, 

which means they are in 

effect getting paid above the 

current market price. But many 

unhedged producers have also 

continued to pump oil, since 

the market price is still above 

the marginal cost of producing 

another barrel, even if it doesn’t 

cover the upfront costs of drilling 

the well. Most important of 

all, their productivity has continued 

to improve in leaps and 

bounds. Wells that used to take 

35 days to complete now take 

17, says Daniel Yergin of IHS, 

a research firm. The amount of 

oil produced per dollar invested 

will rise by 65% this year, he says. 

Better seismic data, improvements 

to the fracking liquids 

pumped into wells and more 

intensive deployment of rigs are 

all helping. 

In all, IHS reckons that 80% of 

the new capacity this year will be 

profitable with WTI at $50-$69 

a barrel. As its price has edged 

above $60 in recent days, some 

shale companies have begun 

to talk about increasing output 

again. The size of the “fracklog”, 

the pipeline of ready-to-roll 

projects awaiting better prices, 

is contested. But the principle is 

clear: American shale firms have 

become the new “swing producer” 

of the global oil market. 

Its main influence used to 

be OPEC, and particularly the 

Saudis, switching the taps on 

and off to try to rig the price. 

Now the market is increasingly 

led by the American frackers, 

ramping their drilling up and 

down in response to global 

prices. Petromatrix, a consulting 

firm, has coined the phrase 

“shale band” for the price range 

between $45 and $65: below that 

range, American production 

falls sharply; above it, it surges. 

If so, there should be a tendency 

for prices to stay within that 

range. 

The greater the proportion of 

the world’s oil supply that comes 

from fracking, the stronger this 

effect will be. The American government’s 

Energy Information 

Administration has in the past 

three years raised its forecast of 

American oil output in 2020 by 

3.1m barrels per day to 10.6m— 

the equivalent of adding another 

producer the size of Iraq. There 

is scope to reduce production 

costs further through the consolidation 

of what is still a fragmented 

fracking business. This 

week, in the first big deal of its 

kind since the oil-price drop, 

Noble Energy said it would buy 

Rosetta Resources, a smaller 

and indebted rival, for $2 billion, 

paid in shares. More such 

deals are likely. Paul Stevens of 

Chatham House, a think-tank 

in London, expects a “flurry of 

mini-mergers”. 

As American production continues 

to rise, pressure will grow 

on the government to ease its 

restrictions on exports of crude. 

In the meantime America’s imports 

are diving—they fell below 

those of China last month. Other 

countries, from Russia to Argen- 


DIVERSE ISN’T 

JUST WHO WE ARE, 

IT’S HOW WE DO BUSINESS 

An enormous variety of natural resources 

and agricultural offerings coupled with a 

growing domestic market mean that Nigeria 

trades touch every corner of the globe. 

Think about how far your business can go 

with the right connections. 

Come talk to us. 

www.stanbicibtcbank.com 

Stanbic IBTC Bank PLC RC 125097 

SBSA 183611 01/15


BUSINESS DAY 


15 

After OPEC 


Business 

Parental leave 

More hands to rock the cradle 

Both parents should be paid to spend time at home with 

their babies 

tina, have promising shale beds. 

Although they lack America’s 

expertise, finance and legal 

system, they may eventually 

begin to produce oil from them 

in significant quantities. 

All this leaves the Western 

oil majors in an uncomfortable 

place. They are used to overseeing 

huge, high-risk, long-term 

projects, and have not shaken 

the habit of indulging in costly 

bespoke solutions which delight 

their engineers but give their 

accountants nightmares. Mr 

Yergin of IHS notes that there 

are 328 standards within the 

industry just for valves. Contrast 

this with the shale firms, 

whose wells are small, cheap 

and drilled quickly using standardised, 

interchangeable parts. 

The current weakness in prices 

will eventually force the oil majors 

to strain themselves to find 

cheaper and more flexible ways 

of working, however. Oswald 

Clint of Sanford C. Bernstein, 

another research outfit, thinks 

that the majors have scope to cut 

perhaps tens of dollars a barrel 

from their breakeven prices. 

Unless some large-scale conflict 

erupts that takes out some 

of the world’s biggest oilfields, 

the oil industry may be heading 

for a new normal in which 

the price of crude oscillates in 

the mid-double digits. The one 

thing that might make it break 

out of this range and head back 

above $100 is a surge in demand. 

However, economic growth and 

energy consumption have decoupled 

in the rich world; and it 

is an open question if emerging 

economies will be as wasteful 

of energy in coming decades as 

the established ones were in the 

past century. Ever more affordable 

renewable-energy sources, 

and cheap gas, are proving increasingly 

attractive alternatives 

to many users of oil products. 

Paul Sankey of Wolfe Research, 

a New York-based outfit, 

believes that underinvestment 

resulting from the recent sharp 

dip in crude may lead to one last 

spike in the oil price; but after 

that, he reckons, the “oil age 

is over”. Even if that proves an 

exaggeration, a return of OPEC’s 

dominance seems a distant 

prospect. 

IN AMERICA there is nothing we 

wouldn’t do for moms—apart from 

one major thing,” said John Oliver, 

a British-born comedian, in his 

television show, “Last Week Tonight”, 

on May 10th (Mother’s Day). The 

“major thing” he was speaking of is paid 

maternity leave, which, as he pointed out, 

is standard in all but two of 185 countries 

surveyed by the International Labour 

Organisation (ILO): America and Papua 

New Guinea. In America some women 

who work for the federal government 

or larger firms can take 12 weeks’ leave 

unpaid after giving birth. In a handful 

of states new mothers get a few weeks 

at a low wage, funded by a payroll tax. 

By contrast, in Britain new mothers can 

take a year off, and during much of it part 

of their salary is replaced by the government. 

Sweden grants more than a year’s 

paid maternity leave—even to women 

who were not previously employed. 

America would do well to take note. 

Many countries are proud of their maternity 

leave, and rightly so: the social and 

economic benefits of making it possible 

for working mothers to spend time with 

their newborn children are clear. But 

many of those countries have failed to 

follow the argument through to its conclusion. 

The gains from maternity leave 

would be multiplied if countries extended 

it to apply to fathers, too. 

Mothers who struggle to combine 

work with child care often sacrifice 

work. That lowers their lifetime earnings 

and leaves them and their children 

more likely to end up poor. Much of 

Europe introduced paid maternity 

leave in the 1970s. Since then dozens of 

other countries have found that giving 

new mothers a reasonable amount of 

time off work—the ILO recommends 

at least 14 weeks—increases women’s 

participation in the labour force. 

The Papas and the Mamas 

But there are problems. Overly 

generous provision sometimes harms 

women, rather than helping them. 

Those who take long spells off work 

see their skills grow rusty and fail to 

gain experience and promotions. And 

although gender discrimination at 

work is illegal almost everywhere, some 

employers still avoid hiring women 

they think will be away a lot. 

Paid paternity leave can help. Nearly 

half the world’s countries now offer 

new fathers short periods at home; 

a growing number let mothers cede 

some maternity leave to their partners 

while they go back to work. Several 

European countries have started to 

reserve some of that leave for fathers 

to encourage them to make use of the 

opportunity: in Sweden couples get an 

“equality bonus” for splitting their time 

off more evenly. 

Fathers and offspring benefit. When 

a woman hands her baby to the father 

and heads out of the door to work, he 

learns how to be a better parent. The 

hands-on habits he picks up persist: 

fathers who take even short paternity 

leave play a bigger role in child-rearing 

years later. An international study 

found that they were more likely to 

brush their toddlers’ teeth, feed them 

and read to them. Babies whose fathers 

take paternity leave go on to do better 

in cognitive tests at school. Fathers 

are generally keen on their progeny, 

so some time to bond with them is a 

boon. Some men who thought that 

child care would not be much fun discover 

that they rather like it. Mothers 

are big winners, too. If both sexes are 

likely to take time off for child care, 

there is less temptation for employers 

to discriminate against women. Timeuse 

studies show that even when both 

parents work the same amount, the 

mother usually does more child care 

and housework. More hands-on fathering 

should cut down on this “second 

shift”, which is a big reason why many 

mothers work part-time or in jobs for 

which they are overqualified. 

That leads to gains for society as a 

whole. Few young women these days 

expect to have to choose between 

motherhood and work. In most countries 

they are now better educated 

than their male peers, which suggests 

that careers figure prominently in their 

plans—and makes losing them from 

the workforce an even bigger waste. 

Parental leave that is generous, but not 

too generous, is essential if mothers are 

not to be forced out of work by lack of 

support, or eased out by a surfeit of it. 

And ensuring that fathers take a share 

of it minimises the risks and amplifies 

the gains.




Finance 

The size of the subsidy 

Finance’s Bermuda 

Quantifying the size of tax breaks for borrowing is 

no easy matter 

HOW valuable are tax breaks for debt? 

Most governments say how much mortgageinterest 

relief costs them in forfeited revenue. 

But the second type of tax break—interest 

deductibility for companies and financial 

firms—is harder to get to grips with. As the 

financial system has got bigger and fiddlier, 

no-one really knows how much interest the 

world’s firms pay. National accounts, the 

figures of publicly listed firms and the limited 

tax statistics that exist all give very different 

answers. 

To come up with estimates (see table), The 

Economist has used national-accounts data 

because they should show the broadest range 

of activity. We make adjustments that lower 

the tax break’s size. We include net rather than 

gross interest for non-financial firms. For financial 

firms we include an estimate of interest paid on 

debt but not that paid by banks on deposits. In America 

we exclude partnerships and “pass-through” entities 

that pay no corporate tax. There is nonetheless a lot of 

uncertainty about the figures. National accounts use 

a crude definition of “financial firm” that can include 

not just banks but many other entities—for example, 

the assets of investment funds, which may not pay corporation 

tax. The aggregate figures net the profits and 

losses of firms, and so may fail to capture loss-making 

firms that would not be liable for tax under any regime. 

Some investors who own shares are exempt from tax 

on dividend income. This may partly cancel out the 

bias toward debt at the firm level. We have not tried to 

capture this effect. 

Two conclusions can be drawn from this exercise. 

First, governments need to improve their data collection. 

Second, notwithstanding this, it seems that tax 

breaks for debt today 

Business 

Technology and health 

To sleep,perchance 

Screens before bedtime harm sleep. The effect is 

biggest for teenagers 

PITY the poor pineal gland, 

tucked behind the thalamus in 

a gap between the brain’s hemispheres. 

It has a simple task—to 

make melatonin, a hormone that 

regulates sleep. In days gone by, it 

would start doing so after sunset, 

ramp up to a maximum in the 

middle of the night, and then 

taper off toward the morning. The 

result was regular, dependable 

periods of sleep and wakefulness. 

Modern life, though, is confusing 

for the pineal because its 

signal to start work is the absence 

of light—specifically, of blue light. 

This part of the spectrum radiates 

by the bucketful from lightemitting 

diodes in the screens 

of phones, tablets and laptop 

computers. As far as the gland is 

concerned, that turns night into 

day. Study after study has suggested 

night-time use of screenbased 

gadgets has a bad effect 

on peoples’ sleep. Indeed, things 

are getting worse as screens get 

smaller and are thus held closer to 

the eyes. As a consequence there 

is a tidy market in devices and 

apps which regulate the amount 

of blue light a screen emits. The 

latest research suggests one group 

of people—teenagers—may be 

particularly susceptible. Those 

in their mid-teens already have 

unusual sleep patterns. Left to 

themselves, they stay up late and 

sleep in in the morning because 

their melatonin cycles start and 

finish later than those of adults. 

Add teenagers’ reputations for 

being glued to their screens and 

it certainly seems reasonable to 

hypothesise that adolescents, in 

particular, will suffer from sleepdisruption-by-gizmo. 

One study, published in October 

by researchers in Switzerland, 

tracked the self-reported sleepiness 

and alertness of boys aged 

15 to 17 over the course of two 

weeks at home in which they wore 

either glasses fitted with filters 

that blocked blue light, or else 

clear glasses of similar design, for 

several hours before they went to 

bed. The team then repeated the 

experiment in a laboratory, and 

measured the youths’ melatonin 

levels and reaction times over 

the course of the evening. All the 

results pointed the same way: 

minus blue light, participants 

were more ready for bed. In February, 

research on nearly 10,000 

Norwegian adolescents aged 

between 16 and 19 confirmed 

what casual observation might 

suggest. Almost all used computers, 

phones and the like in the 

hour before they went to bed. The 

data also showed that gadget use 

was closely correlated with sleep 

patterns. The more the teenagers 

looked at screens, the longer they 

took to get to sleep and the less 

time they slept during the course 

of a night. 

A third piece of work, published 

this week in Lighting Research 

and Technology, by Mariana 

Figueiro and her colleagues 

at the Rensselaer Polytechnic 

Institute in Troy, New York, also 

studied people aged between 

15 and 17. Though Dr Figueiro 

looked at only 20 teenagers, her 

results were so much at variance 

with those of work she had done 

previously on adults that they 

seem worth following up. 

On the first night of each experiment, 

participants wore orange 

glasses to screen out blue light, 

and took samples of their own 

saliva at one-hour intervals until 

bedtime. The following night, they 

repeated the procedure, but without 

the glasses. On glasses-free 

nights, volunteers’ melatonin levels 

were 23% lower after an hour 

of looking at a screen, compared 

with their levels on begoggled 

nights. After two hours, they were 

38% lower. 

Dr Figueiro’s previous studies 

with adults yielded falls in melatonin 

of only 14% after two hours 

in front of a computer. In the matter 

of sleep and screens, it seems, 

teens really are different. Not that 

such knowledge will make a jot of 

difference to their behaviour.


17

18 

Monday 18 May 2015


COMPANIES 

& MARKETS 

COMPANY NEWS 

ANALYSIS AND INSIGHT 

Dry construction achieves 50% 

market acceptance, pushes for 

increased interest 

P.22 

BUSINESS DAY 

19 

‘CFOs need to embrace 

digital technologies… or get 

left behind’ 

P.24 

BD FINANCE MONDAY NOTE 

UBA, GTBank outperform 

tier-one peers in Q1’15 

… as tier one banks’ total asset hits N16.03trn 

PATRICK ATUANYA AND BALA 

Lenders in Africa 

largest economy 

Nigeria have defy 

analysts expectation 

as first quarter 

(Q1) earnings surged amid 

Central Bank of Nigeria’s 

(CBN) increase in interest 

rate and a slump in oil price 

that culminated in the devaluation 

of the naira. 

The cumulative total asset 

of tier one banks hits 

N16.03 trillion, which is 20 

percent of the rebased GDP 

of N80.22 trillion. 

UBA records highest 

profit growth 

The five tier one banks 

Continental Re’s profit climbs amid rising expenses 

… Q1 net income up 37.98% 

BALA AUGIE 

Continental Re achieved ing operations across Africa with 2.15 percent in 2014. 

the double digit growth in with a view to consolidating The improved returns South African’s insurance 

penetration is the fast- 

Profit growt (%) Assets growth net (%) income CIR growth amid (%) a NPL 30.67 (%) percent 

increase in insurance The reinsurance compaing 

the resources of the est in the whole world. 

L and its D share growth (%) of the ROAE market. (%) ROAA (%) mean Total asset the (N'billion) company 1 yr NSE is us- 

Returns % 

benefit and underwriting ny plans to open a construction 

property and engineerer 

profit. 

lenges befalling insurance 

owners in generating high- 

Analysts identified chal- 

expenses to N3.96 billion, 

and a 10.24 percent rise ing risk services unit in South Continental Re’s total companies operating in 

Continental Reinsurance 

plc first quarter 

(Q1) net income 

climbed 37.98 percent 

amid rising operating 

Banks 

expenses, as the Nigerian 

company continues to seek 

inorganic growth through 

aggressive expansion across 

Africa. 

The impressive result 

means the company has 

recorded growth at the bottom 

line with United Bank 

for Africa (UBA) leading the 

pack with a 34.71 percent 

increase in Q1 2015 profits, 

while Access Bank, Zenith 

Bank, GTBank, and FBH 

Holdings recorded profit 

growth of 18 percent, 17 

percent, 15 percent and 5 

percent, respectively. 

GTBank and UBA, the 

most efficient in Nigeria 

We believe that these 

lenders’ ability to cut costs 

while increasing profits as 

evidenced in reduced cost to 

income (CIR) ratio is responsible 

for the high return on 

investments to shareholders 

in the first quarter of the year. 

GTBank and UBA are 

the most efficient lenders in 

Nigeria; at the moment both 

banks recorded the highest 

return on shareholder’s 

investment. GTBank’s 29.03 

percent return on average 

equity (ROAE) and UBA’s 

24.80 percent (ROAE) are 

the highest in the banking 

industry (see table). 

UBA is the most cost 

efficient as it recorded the 

highest reduction in CIR of 

7.50 percent, outperforming 

peers. This explains its 

34.71 percent profit growth 

amid regulatory induced 

costs such as the AMCON 

charge. 

The lower the cost to 

income ratio the more efficient 

a bank, and the higher 

the ratio the less efficient 

the lender is in reducing 

costs while increasing profit. 

UBA has the lowest NPL 

ratio 

Nigeria lenders have well 

diversified loan portfolios 

given their aggressiveness 

to lending to the oil and gas 

explorers, telecoms and the 

real sector. 

UBA is improving its 

Risk Management Strategy 

(RMS) and also improving 

on its quality of loan portfolios 

given its NPL ratio of 1.6 

percent, is the lowest among 

the tier one banks. 

The average NPL ratio 

of 2.58 percent of tier one 

banks is below than 5 percent 

benchmark set by the 

CBN. 

Spot light on tier one banks Q1 results 

Banks Profit growt (%) Assets growth (%) CIR growth (%) NPL (%) L and D growth (%) ROAE (%) ROAA (%) Total asset (N'billion) 1 yr NSE Returns % 

GTBANK 15 5.33 -3.26 3.06 12.12 29.03 4.39 2,484 15.5 

UBA 34.71 7.29 -7.5 1.6 -2.9 24.8 2.4 2,964 -27.03 

ZENITH 17 4.9 -3.9 1.7 24.1 20.5 2.9 3,938 2.94 

ACCESS 18 2 -3.71 2.1 2.3 19.2 3.1 2,136 -27.93 

FBNH 5 17 -1.66 3.9 4.4 17 2 4,511 -24.55 

Source: Company financials, BusinessDay Finance note 

Spot light on tier one banks Q1 results 

Consolidated Hallmark 

premium income spike 

means impressive result 

BALA AUGIE 


Insurance 

plc is on a growth 

trajectory as premium 

income spiked 61.47 

percent, an impressive performance 

that means the Nigerian 

company is tapping 

into the country’s growing 

economy. 

For the first three months 

through March 2015, Consolidated 

Hallmark’s gross 

premium income surged 

61.47 percent to N1.97 billion, 

from N1.22 billion the 

same period of the corresponding 

year (Q1) 2014. 

The company’s underwriting 

capacity is efficient 

as net premium earned 

moved by 4.45 percent to 

N993.96 million in Q1 2015 

as against N950.75 billion 

the previous year. Gross 

premium written spiked 

by 47.22 percent to N2.12 

billion. 

Underwriting profits 

were up 12.40 percent to 

N712.81 million in 2015 

from N373.20 million in 

2014. 

Analysts say though 

Consolidated Hallmark recorded 

growth in premium 

income, the industry’s contributions 

to the economy 

remain abysmal. 

The insurance sector 

contributed less than 1 percent 

to the total rebased 

GDP of N80.22 trillion. This 

compares with South Africa’s 

insurance contribution 

of 15 percent to its GDP and 

Kenya’s contribution of 3.40 

percent contribution to its 

$53 billion economy. 

GTBANK 15 

in 

5.33 

operating 

-3.26 

expenses 

3.06 

to Africa. 

12.12 

This strategic 

29.03 

plan is 

4.39 

assets increased 

2,484 

by 12.62 

15.5 

Africa largest economy as 

N109.80 million. 

boost specialist skills in percent to N30.83 billion culture, general mind-set 

UBA 34.71 7.29 While Nigeria -7.5 is a low 1.6 other areas, -2.9 including 24.8 actuaries 

and information in 2014, while total share- 

2.4 in 2015 from N28.20 2,964 billion -27.03 

premium environment, 

ZENITH 17 Consolidated 4.9 -3.9 Re was efficient 

in its underwriting ca- 

support underwriters. 9.71 percent to N16.21 

1.7 technology, 24.1 to advise 20.5 and 2.9 holders’ fund 3,938 jumped by 2.94 

ACCESS 18 2 -3.71 2.1 2.3 19.2 3.1 2,136 -27.93 

pacity as insurance premium The company’s earnings billion in 2015 as against 

FBNH overcome the low premium 5 revenue 17 increased -1.66 by 18.47 3.9 per share 4.4 (EPS) rose 17 by N14.77 2 billion 4,511 in 2014. -24.55 

income environment. percent to N4.82 billion in 33.33 percent to 8k in 2015 The company’s shares 

For the first three months 2015, compared with N4.0 as against 6k in 2014. rose 1.02 percent to N0.99 

through March 2015, Continental 

Re’s net income Net Insurance Premium moved to 5.26 percent in Lagos on Wednesday, the 

billion the previous year. Return on equity (ROE) by the close of market in 

increased by 37.98 percent Income were up by 20.54 2015 as against 4.17 percent 

in 2014, while the months. It market capitali- 

biggest advance in two 

to N837.29 million from percent to N4.40 billion in 

N606.80 million the same 2015 from N3.65 billion in return on average assets sation was N10.27 billion 

period of the corresponding 2013. 

(ROA) jumped to 2.71 percent 

in 2015, compared standing was 10.37 

while total shares out- 

year (Q1) 2014. 

Continental Re is expand- 

billion. 

of people to insurance and 

lack of human capital, poor 

corporate governance issue, 

poor business infrastructure 

facilities and lack of 

awareness on the part of 

consumers on the uses and/ 

sustainability of insurance 

products. 


has overcome the headwinds 

as profit after tax 

(PAT) increased by 12.25 

percent to N285.17 million 

in 2015 from N254.03 million 

in 2014. 

Profit before tax (PBT) 

followed the same growth 

trajectory as it jumped by 

12.43 percent to N419.83 

million in 2015, as against 

N373.40 million in 2014. 

The company’s reinsurance 

expenses surged by 

262.02 percent to a record 

N977.75 million, while management 

expenses reduced 

by 29 percent to N216.89 

million. 

Management expenses 

moved by 18.60 percent to 

N303.64 million in 2015 from 

N255.96 million as of March 

2014. 

The future of the insurance 

industry is auspicious 

as Nigeria’s young and growing 

population opens the 

doors of opportunities for 

the sector to tap into. 

“Even at 2.6 percent annual 

growth rate would have 

accommodated 4 million of 

the population,” said Bismarck 

Rewane, CEO, Financial 

Derivatives Company, at 

the 2015 Insurance Sector 

Outlook. 

“Stable economic growth 

projected at 6.2 percent is 

favourable for business and 

insurance as an important 

arm of the financial services 

market would benefit,” said 

Rewane. 

Consolidated Hallmark’s 

share price closed at N0.50 

on the NSE, while market 

capitalisation was N3 billion.

20 

Monday 18 May 2015


21



COMPANIES & MARKETS 

Dry construction achieves 50% market 

acceptance, pushes for increased interest 

Business Event 

CHUKA UROKO 

After four yours of 

pushing for market 

acceptability, 

dry construction, 

a viable building alternative 

method to the conventional 

wet construction, has 

achieved 50 percent interest 

and it is aggressively pushing 

for more. 

Nigerite, which is promoting 

the relatively new 

building solution in Nigeria, 

says it is building momentum 

to launch this alternative 

building method again this 

year and, according to Jesse 

Onovre, an architect in the 

company, their reason for 

championing dry construction 

was to disabuse people’s 

mind and belief that it was 

not viable. 

Onovre disclosed to BusinessDay 

on the sideline of Lagos 

Architects Forum (LAF) 

organised recently by the 

Lagos State chapter of the Nigerian 

Institute of Architects 

(NIA) that his company, beyond 

marketing its product at 

the forum, was also using the 

opportunity to let the public 

know that dry construction 

remained a very viable alternative 

to wet construction 

that involved use of brick and 

mortar. 

Nigerite, a principal sponsor 

of this year’s LAF, has as 

its flagship product - Kalsi, 

which is its brand for dry 

walls with basic elements 

that make it possible for the 

product to be used to build 

a house and also be used for 

both internal and external 

works. 

“We have been pushing 

for dry construction for about 

four and half years now. We 

are building momentum over 

time and that is why we are 

launching it again this year. 

The reaction to Kalsi wasn’t 

too lovely; I remember I had 

several presentations to people 

and they didn’t understand 

it very well; many said 

they didn’t want to be used as 

guinea pigs for this and it was 

like that for about two years 

when we started,” he said. 

Continuing, he said, “after 

the third year, some people 

including the architects 

tested it and found out that 

it enhanced their jobs. Now, 

people have been coming for 

it and more are also keying 

into it. Overall, the response 

has been impressive, still 

growing though, and better 

than what we had before. I 

would say we have like 45 to 

50 per cent acceptance so far; 

but it can be better.” 

The Kalsi board solution 

offers this alternative at a 

cheaper cost, Onovre said, 

saying they were trying to let 

buyers know that it was possible 

to demystify the process 

of building. 

“Kalsi is not being sold as 

a product but as a building 

solution; so it comes with 

other items like the galvanised 

steel and cement board. 

Experts knowledgeable in dry 

construction say that whereas 

there are some wastages in 

brick and mortar, which are 

not always factored into the 

construction, with the Kalsi 

solution, wastages are taken 

off the shoulders of the building 

owner,” he said, citing the 

pipe used which was already 

prefabricated, saving cost in 

employing artisans coming 

to chisel metals. 

It would be recalled that 

Nigerite recently refurbished 

its reception office using the 

Kalsi solution to serve as a 

testimony to stakeholders, 

create more awareness for 

the Kalsi brand as well as 

demonstrate that Kalsi can be 

used to complement buildings 

and open area offices. 

Custodian and Allied shareholders laud dividend 

culture as firm grows revenue to N25bn 

L-R: Parikshit Chandna, head, consumer electronics; Sunil Kumar, director, consumer electronics; 

Chukwuma Ofoma, head of channel, consumer electronics and Jae Hak Lee, business development 

manager, home appliances, all of Samsung Electronics West Africa, during the media briefing on 

Samsung AC technical forum/launch of Samsung “DVM (Digital Variable Multi) Super” system AC and 

smart inverter air conditioners in Lagos. Pic by Pius Okeosisi 

L-R Chidi Ajaegbu , president , ICAN, congratulating the newly elected president of the PAN African 

Federation of Accountants (PAFA) Asmaa Resmouki of Morocco at the just concluded African Congress 

of Accountants in Mauritius recently. 


Shareholders of Custodian 

and Allied plc 

have commended 

the board and management 

of the financial 

services group for sustained 

dividend culture and increased 

value creation for 

shareholders. 

This is as the company 

recorded positives in all 

indices, posting a total gross 

revenue of N25.20 billion 

as against N24.68 billion in 

2013, showing a 2.1 percent 

increase. Total asset moved 

up by 7.03 percent, from 

N45.65 billion to N48.86 

billion at the end of 2014 

financial year. 

Profit before tax also appreciated 

by 18.73 percent, 

moving from N4.34 billion 

in the previous year to N5.15 

billion in the review year, 

while profit after tax rose by 

13.6 percent from N3.60 billion 

to close at N4.09 billion. 

Earnings per share grew by 

11 percent, from 63 kobo to 

70 kobo at the end of 2014. 

The shareholders, who 

spoke at the 20th annual 

general meeting of the company 

in Lagos, said the firm 

had remained committed to 

increasing shareholder value 

despite the harsh operating 

environment and very fierce 

competition in the nation’s 

underwriting market. 

Custodian and Allied 

paid out a total of 18 kobo 

per share in the full-year 

result for the period ended 

December 31, 2014. This is a 

cumulative of additional 12 

kobo per share as final dividend 

and interim dividend 

of 6 kobo per share paid in 

September of the review year. 

The company is a group of 

financial services firm with 

subsidiaries in general insurance 

business, life insurance 

business, trustees business 

and pension administration. 

The secretary general, 

Independent Shareholders 

Association of Nigeria, Adebayo 

Adeleke, commended 

the board management of 

Custodian for always ensuring 

that dividends were paid 

on a yearly basis in spite of 

the challenges in the operating 

environment. 

“We are happy that you 

are able to post impressive 

result during the operating 

year 2014, as well as for 

paying the shareholders a 

dividend of 18 kobo for the 

year,” he said. 

Another shareholder, 

Kabiru Salaudeen also expressed 

appreciation to the 

company’s management 

for its policy on consistent 

dividend payment, saying 

the organisation was one of 

the few insurance companies 

that paid its shareholders 

interim and final dividends 

for the period. 

Ade Ojo, chairman of the 

company, said in spite of the 

tough national economy, 

regulatory headwinds and 

myriad of challenges of 2014, 

the company did not only 

survive but progressed on all 

fronts during the year. 

“It is very gratifying to 

note that all of the subsidiaries 

were profitable during 

the year. We are happy 

with our management for 

an impressive result despite 

the difficult terrain in which 

it operated in 2014,” he said. 

On future outlook, Ojo 

noted that the national economy 

outlook for 2015 was 

challenging with significant 

headwinds from political 

and national security issues 

- inflation, foreign exchange, 

stock market and external 

reserve concerns, but expressed 

confidence, saying 

“I am however, absolutely 

confident in our management’s 

ability to survive and 

thrive in the difficult terrain.” 

Wilson Ideva, managing director, Aliyu Dikko chairman, board of directors and Nasiru Idris, company 

secretary all of Premium Pension Limited during the 10th Annual General Meeting in Abuja. 

R-L: Shade Jaji, head of service, Lagos State; Adebiyi Mabadeje, commissioner for science and 

technology, Lagos State; Governor Babatunde Fashola of Lagos State; Nike Animashaun, permanent 

secretary, Ministry science and technology, Lagos State, and Zaid Saimua, MD, Palmyra Construction 

Company, at the commissioning of the new Lagos State Ministry of science and technology in Lagos . 

Pic by Francis Abiagam.


23




INTERVIEW 

‘CFOs need to embrace digital 

technologies… or get left behind’ 

Adebayo Sanni, Oracle country director, and Gbemisola Aruwayo-Obe, director, Business Application Cluster of Oracle Nigeria, in this interview with 

BusinessDay’s Daniel Ojabo and Edozie Ifebi, talk about role of technology in driving digital innovation and bottom-line performance. Excerpt: 

How do you see the role of CFOs 

today, especially with the advent of 

technology 

In today’s digital age, the role 

of CFO’s has actually evolved, 

compared with what it used 

to be in the past where their 

responsibilities were tied specifically 

to just keeping scores and 

book keeping into an era where they 

are in the fore front of innovation – 

innovation that is actually driving 

through disruption. 

The CFO role has evolved from 

just book keeping to providing and 

supporting organizations with innovations 

that allow companies to be 

more competitive and also, outside of 

being more competitive, looking for 

new areas of business to run. 

This however, has to be done 

from a collaborative point of view. 

The CFO and the CIO have to work 

together, as the CFO itself cannot 

survive or the CIO either. Collaboration 

is what starts to drive things like 

talent development, revenue generation, 

and growth in the organisation. 

As we go along, we see that the 

CFOs are actually playing a critical 

role in this digital revolution. 

Do you believe companies are 

leveraging technology enough, in 

a manner that can yield significant 

changes in bottom-line performance, 

particularly in the banking sector 

That’s a good question. I think if 

you look at the banking sector, it is 

probably the sector that has actually 

benefited the most from technology 

in Nigeria. 

A lot of banks are starting to look at 

data that they are gathering by implementing 

certain technologies. That is, 

looking at data gathered to help give 

them informed decisions in terms of 

the kinds of customers they can work 

with, trends in customer behaviours, 

and this is starting to build up. So if 

you look at it, I believe we are still in 

the baby phase. 

Having read your article titled 

“Data-driven insights allow CFOs 

to expose new opportunities for 

competitiveness,” you said not all 

industries were at the same stage 

of maturity with respect to innovation. 

Now, in the Nigerian market, 

what sector would you rank top in 

terms of maturity with respect to 

innovation 

For me, I would rank the telcos top 

most because it is either they innovate 

or they die. After the telcos, then 

you have the banking sector, then 

we have the MRDs (Manufacturing, 

Retail and Distribution), and then we 

have the public sector. 

What role does Oracle play in assisting 

CFOs with respect to digital 

innovation 

I think what is important is, for 

CFOs the reality is that we need a 

new type of talent for the 21st Century. 

The important part is making 

sure that they understand the fundamentals 

and as we start to build it 

up, they need to have some soft skills. 

Those soft skills are what are actually 

important for them to be able to understand 

the effect and the beauty of 

technology. 

Now, if you look at what Oracle is 

doing in terms of being able to support 

that, we have several solutions 

that are in place that can actually 

help in terms of allowing the CFOs 

themselves to be able to implement 

the solution that has actually been 

put in place, to be able to take that 

data and to be able to interpret it and 

in turn, to be able to take decisions 

that actually help drive innovation. 

So, Oracle continues to support 

the customers and CFOs in that regard 

through various sets of trainings. 

We have the next source of forces... 

we have cloud, mobile and we have 

big data. The CFO needs to embrace 

these technologies. If they don’t, they 

will be left behind. If you look at Face 

book today, Face book is currently the 

world’s most popular media house 

and yet they don’t create content. 

Everybody is on Twitter, everybody 

is on Face book. Alibaba is the most 

valuable retailer in the world, and yet 

they have no inventory. Everybody is 

on Whatsapp, it processes 3 billion 

messages per day and yet they don’t 

have any servers. 

Why is it imperative for CFOs to 

embrace digital innovation? What 

are the benefits for the CFO and the 

organisation as a whole 

We don’t yet have examples here 

in Nigeria, obviously. CFOs need to 

de-emphasise from tangible assets 

to intangible assets. Like I mentioned 

earlier, Face Book doesn’t create content. 

We all have Face Book accounts, 

we create content for Face Book, 

people advertise on Face Book which 

is how Face Book makes their money. 

Whatsapp, we are all on Whatsapp... 

now it is also influencing investors. 

Investors are looking at paying more 

for companies that are embracing top 

platforms for innovation and growth. 

Companies that are growing faster 

are companies that have business 

models that are embracing the cloud, 

mobile and big data. So, if CFOs 

don’t understand how to leverage 

these technologies, they will be left 

behind. They need to analyse data 

to attain a deeper insight into the 

data that they have. They also have to 

gather unstructured data from various 

social media platforms – twitter, 

Face book, etc. They can’t ignore it 

anymore; it is a trend that has come to 

stay. Companies that have leveraged 

on these technologies are making 

more money. Research by Deloitte 

revealed that companies that have 

developed their business model 

to leverage on these technologies 

are making 80 percent more than 

companies that are emphasising on 

tangible assets. So, it’s a fact. 

When you start to look at CFOs 

Adebayo Sanni 

“Our database has 

never been hacked 

and there is a reward 

out there if it is ever 

done. Oracle has all 

the security certifications 

in the industry... 

it is more secured to 

be on the cloud than 

even on-the-premise 

right now 

and their role, I think the fundamental 

part of it is to look at how the internal 

processes can be streamlined. 

Once you start to look at streamlining 

internal processes, you drive 

innovation and you get a huge cost 

reduction. 

McKinsey did a survey and said 

that the impact of cost reduction via 

streamlining internal processes was 

able to reduce by about 36 percent. 

If you now look at it, what do you 

now get as a result of cost reduction 

in driving innovation with the solutions 

she just described? It also gets 

to a point where you are helping the 

organisation itself become more 

competitive. So, in a world where 

competition is fierce, this is how you 

stand out because you are reducing 

your overall cost, becoming more 

competitive, you are looking for new 

ways of creating destruction and 

more importantly, you are driving 

revenue growth. 

So, I think once you have all of 

that, those are some of the benefits 

that an organisation gets by really 

streamlining internal processes. So it 

is not just really from a customer side, 

you come back in and that’s the real 

role of the CFO. So apart from being 

a business advisor, they just also provide 

strategic direction for the organisation 

and that’s where it’s evolving 

from just book keeping into this new 

role where they sit as the strategic 

adviser to the organisation to drive 

innovation reducing cost, making 

the company more competitive and 

also looking for way to improve profitability 

and revenue generation. So, 

the companies that are not adopting 

these as she just mentioned just end 

up being left behind and the margin 

we are seeing between the companies 

that are adopting these digital 

transformation or digital technology 

is getting wider and wider. Eventually, 

every business will become a 

digital business without any doubt 

but the ones in the forefront are the 

ones that are going to benefit more. 

What specific technological 

model do you recommend to 

help firms do better in their data 

analysis 

First, they have to recruit the 

right talent, people that have the 

requisite ability to mine data, and 

analyse it in a meaningful way that 

people can read and derive value 

from it. Also, since they already 

have a finance team, they will have 

to re-train and re-orientate them. 

MBA programmes have now introduced 

technology as part of their 

curriculum, so that participants can 

embrace technology. Oracle is also 

working with universities, making 

sure that in the curriculum these 

technologies are taught to accounting 

and finance students, so that 

when they graduate, they can deploy 

the skills they have acquired already. 

These are two ways CFOs can get and 

nurture the right talent. 

Some challenges faced by CFOs 

include financial loss as a result of 

cybercrime and internal collusion 

by company staff. How can technology 

help to forestall this 

Users believe that when they purchase 

a solution, they have the best at 

that point in time. But technology is 

dynamic. It is always changing. And 

there are people out there whose sole 

job is to study your processes and try 

to spot loopholes in them to exploit. 

The CFO needs to continuously look 

at his internal processes and upgrade, 

as well as continue to retrain his staff 

to ensure the effectiveness and efficiency 

of the process. So CFOs have 

to repeatedly hone their processes. 

What is your take on the cloud 

computing market in Nigeria 

Are Nigerian companies beginning 

to think in the direction in 

terms of adopting it 

I think it is inevitable. It is the future. 

Cloud is one of the 5 key digital 

disruptors that we have today outside 

of mobile, internet of things and 

social. The sooner companies start 

to embrace it, the better. Nigeria is 

no exception. 

Some of our customers are now 

waking up to the reality that cloud 

computing is the future. Surprisingly, 

the information at their disposal is 

not adequate. Institutions like the 

banks will have concerns for security 

when putting their information on 

the cloud. We as Oracle are helping 

our customers go through this 

change. We are partnering with 

them. We are developing a roadmap 

of three to five years, to go along with 

the customer through this change. 

What has the ERP market been 

like 

Oracle is synonymous with the 

Enterprise space, but we are also 

going in to the SME space with our 

Cloud offering. With as little as 5 users, 

you can have Oracle ERP. That’s 

the beauty of our cloud offering. We 

have ERP in the cloud; we have Enterprise 

Performance Management 

solutions in the cloud also. So, it is 

available to you. You don’t need to 

implement or buy hardware, and the 

scalability is there. The cost to acquire 

this solution is reduced. It is a pay-asyou-go 

subscription.


BUSINESS DAY 25 


ABUCCI targets 50% revenue 

expansion from exhibitors 

… to encourage business facilitation for members 

HARRISON EDEH, ABUJA 

Abuja Chamber 

of Commerce 

and Industry 

(ABUCCI) has 

revealed plans 

to improve its revenue base 

by 50 percent at the forthcoming 

trade fair involving 

both local and foreign 

participants. 

Through business facilitation, 

the Chamber aims to 

galvanise proper networking 

of various businesses 

and create an avenue for 

closing up of business deals 

and signing of memorandum 

of understanding 

among various parties. 

Tony Ejinkonye, president, 

ABUCCI, said at the 

pre-10th Abuja International 

Trade Fair conference, 

that the chamber 

would be riding on the 

improved security conditions 

in the country to 

bring businesses together 

in its bid to diversify the 

country’s revenue base and 

create opportunities for the 

youths. 

The fair, which would 

take place between September 

18 and October 2, 

would target the promotion 

and growth of industry and 

concentrate on the promotion 

of non-oil exports, the 

president explained. 

The fair is expected to 

see more participants due 

largely to the nation’s improved 

security apparatus, 

with the recorded feat in 

the nation’s fight against 

the dreaded Ebola virus, 

which he said affected last 

year’s fair. 

“For this year’s exhibition, 

we are expected 

to have up to 150 foreign 

exhibitors because of the 

peaceful atmosphere we 

have in the country, unlike 

the previous year, when we 

have 65 exhibitors only,” 

he said. 

Also, Adetokunbo Kayode, 

first deputy president 

of the Chamber, said more 

businesses would have 

opportunities for proper 

networking as the Chamber 

had prepared the ground 

for effective collaboration 

targeted at business facilitation 

of various businesses. 

“This year, we would 

be leveraging on ICT for 

the management of the 

fair, and to promote management 

of the fare. For 

instance, we are organising 

as part of this fare, an 

international ICT event,” 

Kayode said. 

“Our role is to promote 

the business of our members. 

In mining for instance, 

we intend to expose our 

members to the opportunities 

that are available in the 

country, like the kaoline, 

the mines ands steel sector, 

among others,” he said, 

saying various government 

agencies with outstanding 

research findings would 

also be exhibiting such 

findings for the business 

community to advance the 

commercialisation. 

Skye Bank revs up retained earnings 

to scale up investment 

Skye Bank’s submitted 

full-year 2014 

results to the Nigerian 

Stock Exchange 

(NSE) show a significant 

appropriation to retained 

earnings, demonstrating 

the bank’s ambition to play 

and dominate the tier 1 

retail banking space. 

Retained earning, which 

is an indicator of a company’s 

plans for growth in 

the future, was grown 70.6 

percent from N19.73 billion 

in the 2013 financial year to 

N33.7 billion in 2014. The 

numbers helped swell the 

bank’s total equity level to 

N132.26 billion from N121.4 

billion, a 9 percent rise. 

The IFRS compliant results 

show operating income 

was up marginally to 

N69.33 billion from N68.5 

billion, indicating increasing 

efficiency in cost management. 

This was on the 

back of a 2.4 percent rise 

in interest income from 

N105.3 billion to N107.85 

billion. 

Interest income is an 

indicator that helps explain 

how well a bank is doing in 

its maturity transformation 

quest. 

The bank’s headline and 

bottom-line profits in the 

period under review were 

tempered by impairment 

charges, regulatory payments 

and higher operating 

cost, including cost 

of acquisition Mainstreet 

Bank among other costs. 

These muscled-down pretax 

profit 46.7 percent from 

N19.65 billion to N9.74 billion. 

The bank has over the 

last year grown assets 27 

percent from N1.12 trillion 

to N1.42 trillion, helping 

to provide a stronger cover 

for deposit liabilities. The 

metric improved to 1.5 from 

1.3. This is as the bank has 

grown deposits 15.7 percent 

to N952.3 billion from 

N823.3 billion. 

A robust deposit base 

is an indication of a bank’s 

strong marketing ability, 

especially in the area of 

attracting and mobilising 

deposits. 

The group’s liabilities 

consisting of deposit base 

and other accruals rose to 

N1.29 trillion during the 

period compared with N995 

billion achieved a year ago. 

Speaking on the results, 

Timothy Oguntayo, the 

bank’s group managing 

director/CEO, said in spite 

of the challenging operating 

environment, the bank 

carefully grew its risk assets 

portfolio, attained a 15.7 

percent growth in deposits, 

supported customers in 

critical and productive sectors, 

and declared a fairly 

decent profit. 

The recent acquisition 

of Maintreet Bank, which 

has resulted into a much 

larger franchise of over 

450 branches, provides the 

bank with enhanced capacity 

to provide easier access 

to its teeming customers, 

and explore various opportunities 

in diverse segments 

of the Nigerian economy, 

Oguntayo said. 

The results have some 

good news for investors 

who have watched their 

investment grow in the last 

financial year, making it one 

of the fastest growing banking 

stock on the NSE.

26 

Monday 18 May 2015


27



BUSINESS INTELLIGENCE 

The real managers in 

billion-dollar sports 

A growing number of private banks and wealth managers are 

targeting sports stars as a lucrative – and needy – sector 

TARA LOADER WILKINSON 

Editor in Chief, Wealth-X 

There’s a lot of money 

to be made in sport, 

never more clearly evidenced 

than last weekend’s 

fight between 

Manny Pacquiao and Floyd Mayweather, 

which has been called 

the richest in boxing history. 

Thirty-eight-year-old Mayweather, 

an undefeated fiveweight 

world champion, could 

take home as much as US$180 

million in revenues from Saturday’s 

fight, including pay-perview 

subscriptions, arena tickets, 

sponsorship, merchandise and 

broadcast sales. 

Thirty-six-year-old Filipino 

fighter Pacquiao, a six-time welter 

weight world champion, pocketed 

around US$120 million, swelling 

his net worth by around a third to 

around US$300 million, according 

to Wealth-X. 

Mayweather and Pacquiao battling 

in the boxing ring on 2nd May 

at the MGM Grand in Las Vegas. 

(Getty Images) 

Meanwhile in football, the 

richest football league players 

include Real Madrid star Cristiano 

Ronaldo with US$230 million in 

assets and Argentine forward Lionel 

Messi with US$180 million, 

according to Wealth-X. 

Earnings in sport – from sponsorship 

and wages – are on the 

up like never before, says Peter 

Cormack, financial planner at 

UK-based wealth manager Towry. 

“Sports industry revenues will 

always rise mainly due to the 

interest from companies buying 

TV rights and the money that this 

generates.” Earlier this year broadcasters 

Sky and BT agreed to pay a 

record £5.1 billion (US$7.7 billion) 

for live Premier League TV rights, 

a 70 percent increase on their current 

deal. Under the new contract, 

168 games will be shown at an 

average cost to the broadcasters 

of £10.2 million per match, underlining 

the eye-watering costs 

associated with sports. And bigger 

TV audiences translate to golden 

handshakes for players. Deloitte 

predicts that Premier League 

clubs’ player spending will total a 

record £2.5 billion in 2016/2017. 

Among the most affluent 

sports today are football, golf, 

tennis, basketball, car racing 

and boxing, some for their eyewatering 

wages and some for 

their lucrative sponsorship deals. 

The wealthiest F1 drivers have a 

combined US$1.6 billion between 

them, according to Wealth-X, 

with German seven-time world 

champion Michael Schumacher 

at the top of the list with a US$780 

million fortune. As for basketball 

players, the top ten richest NBA 

players have combined assets of 

US$1.7 billion, lead by LA Lakers 

guard Kobe Bryant, who has assets 

of US$290 million, and Cleveland 

Cavaliers player LeBron James, 

with US$280 million. 

“Sportspeople never used to 

be rockstars,” said Mike Byrne, UK 

director at Wealth-X.. “But over 

the last ten years compensation 

has gone through the roof, and 

looks set to continue as long as 

the fan base grows.” 

Stars are compensated differently 

according to the sport. 

Team players like footballers and 

basketball players earn more 

money from contracts and wages 

and the best get supplementary 

sponsorship deals. Solo athletes 

like F1 drivers, tennis players and 

golfers rely more on winnings 

and endorsements, said Byrne. 

And while they may be at the top 

of their game on the pitch or the 

track, but when it comes to managing 

their money, sports stars 

keep getting their fingers burned. 

Which is why a growing number of 

private banks and wealth managers 

are targeting sports stars as a 

lucrative – and needy – sector. 

Earlier this year it was reported 

that a number of sports VIPs had 

been linked to an alleged tax 

avoidance scheme run by London 

film firm, Ingenious Media. Those 

linked included footballers past 

and present Gary Linekar, David 

Beckham, Steven Gerrard and 

Wayne Rooney, and former England 

cricketers, including ex-England 

Captain Michael Vaughan, 

Paul Collingwood, Matthew Hoggard 

and Ashley Giles who are 

reportedly liable for unpaid tax. 

(Ingenious Media denies these 

allegations and believes the partnerships 

to be bona fide commercial 

film partnerships. Ingenious 

and HMRC are currently involved 

in proceedings before the First 

Tier Tribunal over the tax status of 

the partnerships.) Meanwhile ex- 

England goalkeeper David James 

was reportedly declared bankrupt 

last year after he allegedly lost 

over £7 million on bad property 

bets and gambling. Meanwhile in 

the US, as many as 78 percent of 

NFL players are either bankrupt or 

under financial stress within two 

years of retiring. In the NBA, 60 

per cent are bankrupt within five 

years, according to a 2009 report. 

The reason, more often than 

not, comes down to bad advice. 

“The problem is that sportspeople 

often get very wealthy, 

very young, and are often not 

well-versed in accounting matters,” 

pointed out Lee Goggin, cofounder 

of Findawealthmanager. 

com, a London-based guide to 

wealth advisors. 

Sports stars have uneven income 

streams and an uncertain 

end to their career from the threat 

of injuries. While some are able to 

go into sports coaching, media, 

or even like ex-footballer Robbie 

Fowler, property investment masterclasses, 

many have no obvious 

career post-thirty. 

“The taxman does not take this 

peculiarity into account either,” 

pointed out Goggin. 

These types of clients require 

a “really 360 solution which encompasses 

some hardcore tax 

planning and jazzy structures,” 

he added. Guernsey image rights 

are a way sports stars can monetise 

their recognisable features 

and then structure that (and bequeath) 

it as an asset in its own 

right. 

Wealth managers including 

UBS, Coutts, Barclays Wealth, 

HSBC Private Bank, Schroders 

and Standard Chartered Private 

Bank have specialist sports wealth 

management desks to cater to 

millionaire sports stars. US investment 

banking giant Morgan 

Stanley recently opened a specialist 

unit in the US, and at the 

other end there are middle-tier 

advisers like Smith & Williamson 

and Wetherby’s. 

It is a changing playing field. 

Coutts is now advising its sports 

star clients to prepare themselves 

for the power of social media. As 

the influence of sport grows, this 

will be the next big money-maker, 

said Simon Hopes, executive 

director, sports & entertainment 

at Coutts. 

“Because of social media, image 

rights have never been more 

important. It is vital that sports 

men and women have expert 

representation to maximise their 

earnings opportunities in this area 

and grow their brand judiciously,” 

he said. 

“Digital content needs controlling 

as whilst incredibly powerful, 

the potential for catastrophe is 

huge,” added Hopes. 

Players clearly need more advice 

as they earn more and as media 

evolves. For wealth managers 

there is a big opportunity as well 

as growing competition. 

Those agencies that flourish 

will be those that can offer full 

service packages that will incorporate 

contract negotiation, brand 

management, digital and social 

media content management, merchandising, 

image rights and intellectual 

property or forge trusted 

partnerships to ensure that these 

services are fully exploited. 

A version of this story previously 

appeared in digital magazine 

Adoreum.-Wealth-X 

Managing shareholder 

associations 

ADEBISI ADEYEMI 

Institutional Shareholders 

and indeed individual 

shareholders are key 

stakeholders in any organization 

and play a significant 

role in corporate governance. 

The focus here is on Shareholder 

Associations and how 

managing them effectively is 

an important aspect of stakeholder 

management which is 

essential to the success of every 

company. 

The emergence of “Independent” 

Shareholder Associations 

in the wake of the 

privatization and commercialization 

program of the Federal 

Government was an indication 

that Nigerian investors were 

no longer solely interested in 

the economic value of their 

shares, but also in the influence 

over corporate strategy 

and management afforded 

by ownership. Some of the 

Shareholder Associations have 

become powerful lobby groups 

seeking to be appeased by 

Board and Management. While 

some of these Associations 

provide beneficial input to the 

Company, others have become 

notorious for their “rabble 

rousing” activities at General 

Meetings, thereby losing the 

opportunity to make meaningful 

contributions to Company 

performance. 

The Securities and Exchange 

Commission (SEC) 

had attempted to regulate the 

activities of Shareholder Associations 

by issuing a Code 

of Conduct for Shareholder 

Associations. This initiative 

was an attempt to address 

observed negative practices of 

Shareholder Associations in 

the capital market, particularly 

conduct during general meetings 

and their interaction with 

Management outside the general 

meetings. The Code was 

intended to foster an adherence 

to the highest standard of 

ethical conduct by Shareholder 

Associations. 

According to the Code, 

Shareholder Associations are 

required to be registered with 

both SEC and the Corporate Affairs 

Commission (CAC). Mem- 

Adeyemi is managing director, 

DCSL Corporate Services Limited 

(badeyemi@dcsl.com.ng) 

bers and officers of Shareholder 

Associations are barred from 

attending general meetings of 

a company in which they are 

not shareholders and required 

to conduct themselves with 

decorum during general meetings. 

The success of the Code 

thus far in achieving its avowed 

objectives remains doubtful. 

Managing the relationship 

with Shareholder Associations 

should be a priority and 

if properly channeled, their 

activities could constitute a 

positive force in shaping the 

direction of corporate decision 

making in companies. The following 

strategies are suggested 

towards getting the best out of 

Shareholder Associations: 

•Accreditation – To give 

effect to the SEC Code of Conduct, 

it is advised that the 

Company Secretary should 

institute an accreditation process 

through which only those 

Associations compliant with 

the Code are recognized. 

•Shareholder Education 

– Members of Shareholder 

Associations could benefit tremendously 

from relevant training 

that would expose them to 

best practice. 

•Adequate Disclosure - 

Shareholders should be kept 

informed through annual reports, 

interim reports and 

other strategic communication 

of material information relating 

to the companies’ business, 

directors and management. 

Companies should put in place 

an Investor Relations Policy 

to promote regular, effective 

and fair communication with 

shareholders. 

•Website - The company’s 

website should be easily accessible, 

user friendly and 

updated regularly. 

•Investor Forum – Board 

and Management should meet 

with Shareholder Associations 

periodically to afford a platform 

for keeping them upto-date 

with the company’s 

performance and other matters 

of interest. 

Concerns have been raised 

as to whether more shareholder 

involvement would disrupt 

the very mechanism that 

makes the running of public 

companies practical- i.e. centralizing 

power in the Board 

of Directors. It is important 

to strike a balance between 

shareholder involvement and 

the practical considerations of 

running a company efficiently. 

By encouraging and creating 

the appropriate fora for constructive 

engagement with 

Shareholder Associations, the 

Board can help to set the tone 

and expectations for good governance.


29

30 

Monday 18 May 2015


BUSINESS DAY 

31 

Start-Up DIGESt 

TOOLKIT FOR ENTREPRENEURSHIP 

‘I started my 

business with 

N25,000’ 

Page 32 

For sponsorship enquiries 

call - 0806 054 7811, 

0802 601 1296 

Tourism: The 

diamond in the 

dirt 

Page 34 

Establishing a modern bakery 

OLUMAKINDE ONI 

Bread is a major product 

of bakery and 

about the most demanded 

all over the 

world. The implication 

of this is that demand for 

bread is automatic. Consumption 

of bread cuts across all ages, 

gender and races. Bread is taken 

virtually every minute. It can be 

taken as breakfast, or lunch or 

even as a dinner. It is a readymade 

food that does not demand 

further preparation, except for 

those who want to toast it. 

Raw materials for bread production 

are readily available. 

The major raw material is wheat 

flour, which is heavily imported 

into the country. 

Bakery can be managed by 

middle or low level manpower. 

The ease of set-up needs not be 

over- flogged. 

Bakery belongs to the smallscale 

group. Its establishment 

will create more jobs and wealth. 

Other benefits include reduction 

of food crisis and social vices 

as well as stemming of hunger. 

Establishment of bakery is 

profitable. Our investigation has 

revealed that percentage return 

on sales is about 40, while that of 

return on investment is above 200. 

In view of the above, bakery 

establishment is recommended 

for serious-minded and forwardlooking 

investors. 

Technical information 

The major raw material for 

bread production is wheat flour. 

Other ingredients are sweeteners, 

yeast, butter flavour, printed 

nylon and the raising material. 

Food regulatory authorities 

frown at the use of potassium 

bromade (a raising element) 

as it has great side effects on 

people’s health. 

Equipment needed for bakery 

are milling machine, blending, 

moulds and roller. The production 

process involves milling, 

dough mixing, rolling, cutting, 

dough filling and baking. Slicing 

Financial implication 

Pre-investments - N100,000 

Accommodation - N300,000 

Plant and Machinery - N3,250,000 

Utilities - N1,500,000 

Working Capital/Others - N1,000,000 

TOTAL - N6,150,000 

can also be done if the desire is to 

produce sliced bread. To be successful 

in bakery project, there 

must be a good product and 

packing, but the investor must 

be cautious about credit sales. 

Note: The scope can be lower 

or higher depending on the financial 

strength of the investor. 

The first step in project implication 

is preparation of feasibility 

study/business plan showing 

the technical, financial and market 

details of the project. 

This can be provided for seriousminded 

investors. 

Annual Turnover N26 million 

Annual Net Profit N10.5 million 

% return on sales: 40.4% 

%return on Investment Above 200% 

This is no doubt a good project. 

Serious- minded investors 

can be assisted in realising this 

project. 

Contact: 08023058045, olumakindeoni2@yahoo.com 

Packaged fufu powder for local, export markets 

What has prompted 

the writer about this 

project is a result 

of recent investigation 

carried out in which it 

was discovered that there has 

been tremendous change in the 

consumption pattern of people, 

both at home and abroad, on the 

need to eat fufu being prepared 

by them from the powder. 

It was further discovered 

that existing producers in Nigeria 

couldn’t meet up with 

the demand of the users of this 

all-important product. Not only 

that, export market for fufu 

powder is widening every day. 

In this regard, forward-looking 

and aggressive investors can 

capitalise on this viable investment 

opening. 

Investment justification 

Raw materials for production 

of fufu powder are readily available 

in Nigeria, as the basic raw 

material is cassava. Nigeria is 

the second largest producer of 

cassava in Africa after Zaire and 

fifth in the world. 

About 10 million metric tons 

of `raw cassava are produced in 

Nigeria annually. Nigeria has 

the potential (land and human 

resources) to produce more than 

100 million metric tons per annum 

of cassava tubers. 

The demand for fufu powder 

in Nigeria and abroad cannot 

be overemphasised. Fufu is very 

rich in carbohydrate and the 

smooth texture, when prepared, 

is an attraction. Fufu powder 

produced from factories and 

well packaged will gain instant 

acceptability from consumers. 

The profitability of the project is 

not in doubt as it costs a maximum 

of N80, 000 to produce a 

ton, which is currently being 

sold at N150,000 (minimum) in 

the market. 

A profit of N70,000 per metric 

Continues on page 33



Start-Up DIGEST 

How Airtel’s ‘Catapult-A-Start-Up’ 

drives entrepreneurship 

ODINAKA ANUDU 


#BDStartupDigest 

Team 

Editorial Direction 

Ikenna Obi 

Staff Writers 

Oluyinka Alawode 

Odinaka Anudu 

Josephine Okojie 

Graphics 

Monday Aghaeze 

Contact: 

startupdigest@businessdayonline.com 

Follow us on twitter@Digeststartup 

On May 7 and 

8, 2013, the 

Responsible 

Business Summit 

was held in 

London, the United Kingdom. 

The rationale behind 

the summit was to fashion 

out how best businesses 

could marry profitability and 

social responsibility.One 

of the strongest and most 

salient take-aways from the 

event was that ‘businesses 

cannot be successful when 

the society around them 

fails’. 

In Nigeria, many corporations 

look away while one 

out of three start-ups dies 

within three years. But Airtel 

Nigeria, a leading telecoms 

operator, has demonstrated 

that it is not only a responsible 

corporation but also a 

responsive one, with a solid 

plan to catapult start-ups to 

conglomerates. 

Recently, Airtel launched 

an entrepreneurial initiative 

tagged ‘Catapult-a-Start-up’, 

a platform which aims to 

inspire innovation and assist 

start-up service providers 

towards actualising their 

business goals and dreams. 

Airtel provided this 

platform for budding service 

providers to receive 

advanced mentoring from 

industry veterans, funding, 

marketing, and also improve 

their skills to become successful 

using their creativity. 

The firm made it explicitly 

clear from the outset 

that start-ups interested in 

participating in the programme 

should submit their 

ideas and presentations to 

the ‘Catapult-a-Start-up’ 

website at www.cas.ng, for 

evaluation. 

Further procedures were 

equally clear. After the initial 

evaluation, selected startups 

would be invited to pitch 

their ideas to a panel of esteemed 

judges who would 

do a thorough evaluation 

and select the best start-up 

proposals. 

The promoters of the selected 

start-up proposals 

would then be supported 

with a cash prize of N1 million, 

including mentoring, 

funding, marketing and a 

chance to integrate their 

developed apps and services 

on the Airtel platform, gaining 

direct access to the telco’s 

large customer base. 

L-R: Tomi Davies, chairman and founder, Mobile Monday; Zubair Abubakar, co-founder/CEO, Chop Up; Roht Arora, assistant 

marketing manager, Airtel; and Nitin Anand, vice- president, data products and services, during the Airtel Catapulta-Startup 

prize presentation in Lagos recently 

Speaking during the 

launch in Lagos, Segun Ogunsanya, 

managing director 

and chief executive officer, 

Airtel Nigeria, said that Airtel, 

as an innovative and 

forward thinking brand, initiated 

the programme in line 

with its vision to encourage 

innovation and empower 

young Nigerians by creating 

opportunities for them to 

bring their business ideas to 

fruition. 

“At Airtel, we are passionate 

about building a community 

for young talented 

Nigerians. We are aware of 

the abundance of young 

people who are blessed with 

the skills to develop relevant 

apps with most of them not 

having the opportunity to 

showcase or develop their 

skills,” Ogunsanya said. 

“Through the Catapulta-Start-up 

programme, we 

aim not only to identify talent, 

but also to encourage 

local content. The apps and 

services developed by these 

start-ups will ride on Airtel’s 

superior 3.75G network in 

Nigeria and the large customer 

base. Airtel will continue 

to go the extra mile at 

empowering them to succeed 

in their respective endeavours,” 

he added. 

True to his words, winners 

have emerged in Airtel’s 

‘Catapult-a Start-up’. 

One thing that stands out 

all the winners is that their 

businesses exude creativity 

and are all targeted at solving 

current problems of the 

country. 

We usher you into the 

world of Samson Abioye, 

CEO, Check Right (Pass. 

Ng), based in Ikoyi, Lagos, 

one of the winners. Abioye 

runs Pass.ng, which is an 

examination testing platform 

for students, targeted 

at secondary school leaving 

students preparing to sit for 

major examinations in Nigeria 

such as the West African 

Senior School Certificate 

(WASSCE), the National Examinations 

Council (NECO) 

and the Unified Tertiary 

Matriculation Examination 

(UTME). 

The firm enables candidates 

to take tests and 

prepare themselves with 

the chance of getting better 

ahead of the exams. 

“We think we were selected 

by Airtel because we have 

a good idea. We can scale 

very fast and we are delivering 

a product that is needed 

in the market as people want 

to pass,” said Abioye. 

“The app is currently being 

deployed on playstore 

and the service is available 

on our website (www.pass. 

ng). It costs N100 for a day to 

access full test; N200 a week 

and N500 a month,” Abioye 

further said, adding, “With 

the cash donation from Airtel, 

we hope to develop our 

service more, example in the 

area of audio-video tutorials. 

So it will help us improve our 

services as we are not yet 

where we want to be.” 

Another winner is Ovo 

Emorhokpor, CEO, Yuzah, 

based in Lagos, with an online 

platform, www.yuzah. 

com. 

Yuzah is an online market 

place that connects buyers 

and sellers of diesel who 

meet and transact businesses 

on daily basis. 

Emorhokpor, whose online 

firm has had 1,000 orders 

since December 2014, 

said, “We believe we were 

chosen because Airtel recognised 

our service solves a 

problem on two angles. For 

the customers it is a convenient 

way of getting diesel, 

and for the sellers, it helps 

them get across to buyers”. 

“Airtel has an experience 

in the tele-marketing space 

and is also a trusted brand. 

The firm has a wide network 

of partners around the country 

which can also benefit us; 

its number of subscribers is 

s huge target we could tap 

into,” Emorhokpor said. 

Odunayo Eweniyi, chief 

quality officer, and Joshua 

Chibueze, chief marketing 

officer, PUSH CV, Yaba, 

Lagos, were joint winners. 

Push CV is an internet company 

that enables efficient 

recruitment by providing 

pre-screened candidates 

for employers and recruitment 

agencies. It is an online 

employability program coorganised 

by companies like 

GT bank, Airtel and McKenzie, 

among others, according 

to Eweniyi and Chibueze. 

“We are currently in the 

last stage of the training 

and will be providing 5,000 

qualified candidates to present 

to employers,” they said, 

adding, “We believe we were 

chosen by Airtel because we 

have a good idea.” 

Olusegun Bright, Chief 

Technical Officer, Match Up, 

based in Ilupeju, Lagos, was 

also among the winners. The 

firm helps find and connect 

people, especially singles between 

the ages of 18 and 45. 

“The app is not currently 

being deployed anywhere. 

But it will be on play store 

once it is ready. The app is 

free to download and payment 

is made on subscription 

basis,” Bright said. 

According to Bright, his 

firm was chosen by Airtel not 

just because of a good idea 

but for its several great ideas. 

“We understood how our 

idea will work in tandem 

with Airtel. Its mentorship is 

superb. We have learnt a lot 

and also the clout of having 

Airtel as a partner is beautiful,” 

he added.


BUSINESS DAY 

33 


‘I started my business with N25,000’ 

Abimbola Odunusi is the chief executive officer of Sweet N Savy Couture. She is a banker 

and an entrepreneur with a vast experience in the fashion industry. In this interview with 

JOSEPHINE OKOJIE, she reveals how she manages her careers as a banker and a designer. 

When did you start the 

business? 

I 

started my fashion 

business in 2012, 

but got the business 

registered last year. 

I have been designing 

since 2002. I went 

into sowing because of 

those designs I was making. 

After my university education, 

while I was waiting 

for the National Youth 

Service Corps (NYSC), I 

decided to attend a fashion 

school. After my NYSC, 

I got a job with a fashion 

line, where I learnt how to 

source for good fabrics and 

also how to talk to customers 

and get the fabrics for 

them. All the fabrics for 

my business are sourced 

locally. I go to Yaba and 

Eko-Idumota for them. 

What inspired you to 

move into the business? 

I see that a lot people 

have good fabrics but really 

don’t get to put them 

together in a better way 

that would make them 

look beautiful. I design 

clothes and make people 

look unique. Basically it’s 

about making unique pieces 

that will make others tell 

you that you look bright. 

A woman brightens up 

when people tell her she 

is beautiful. This is what 

I want to achieve for my 

clients. Before I started my 

fashion line, I had a nasty 

experience with a tailor 

who used to spoil my fabrics. 

You need to build that 

confidence so that your 

client can trust you. I even 

have to make free dress 

for some of my colleagues 

so that I can make them 

trust me. And when others 

see it, they would want to 

patronise me. 

What was your start-up 

capital? 

Abimbola odunusi 

I started my business 

with N25, 000 by buying 

sewing machines and accessories 

like needles, 

threads and zips. 

Who are your target 

clients in the business? 

I specialise in only female 

clothes. So I target female 

clients, both old and 

young. The fashion industry 

is highly populated, so 

as a fashion designer with 

a fashion line, you need 

to distinguish yourself to 

remain relevant in the industry 

and to your clients. 

Your client needs to trust 

you before they give you 

their fabrics and money to 

make their dress. 

Have you received any 

external support from any 

organisation, apart from 

clients that have helped 

the business grow? 

I have not received any 

external support from any 

organisation. You really 

don’t need much to start a 

fashion business. 

Tell me a little about 

your background, that 

is, your educational and 

work backgrounds? 

My name is Abimbola 

Odunusi. I am a banker 

and I have a fashion line 

called Sweet N Savy Couture. 

I am a graduate and 

went into the fashion industry 

immediately after 

my university education 

before I got my job with 

a bank. 

How far would you say 

the business has grown 

since starting? 

Since starting, my business 

has grown, but I have 

limited its growth because 

I have to combine my 

banking job and my fashion 

business. During the 

festive season, I don’t take 

many jobs so I can deliver 

on time to my clients. Since 

I started working, I had to 

slow down on my fashion 

business. 

Do you have employees, 

full-time or parttime? 

I don’t have any employee. 

I do most of the 

stuffs alone and give the 

sewing out to other tailors 

to speed up the process. I 

sketch a lot and do most of 

the designs myself. 

What challenges have 

you faced since starting 

your business? 

The biggest challenge I 

face is merging my job as 

a banker and my fashion 

business. It has really being 

very stressful. 

Another major challenge 

I face is power, because 

I do most of my job 

in the night and there is 

always no light at that time. 

What is your advice to 

other entrepreneurs? 

Passion! If you want to 

go into fashion, you must 

have passion for it to be 

a success. Be good looking 

and confident so that 

people see good designs on 

you and want you to make 

same for them. 


Packaged fufu powder for local... 

ton of fufu powder produced 

is therefore possible. 

Other social and economic 

benefits derivable 

are employment generation, 

rural income generation, 

import substitution 

(thereby conserving our 

foreign exchange) reduction 

in social vices and 

increase in value added 

non-oil export. 

Production technology/ 

technical information 

Fufu powder can only 

be produced via good fermentation 

and the use of 

stainless steel equipment. 

Fufu powder processing 

involves washing and 

peeling of raw materials, 

chipping, fermentation, 

pulverisation, sieving, 

sedimentation, sieving, 

de-watering, drying and 

packaging. Implementation 

procedure involves 

feasibility study prepara- 

tion (can be provided on 

request). Finance sourcing, 

plant and equipment 

sourcing, procurement of 

appropriate accommodation, 

recruitment of personnel, 

raw materials procurement 

and commercial 

production take-off. 

Profitability 

Daily net profit of 

N70,000 has been computed, 

working for a con- 

Financial Implication 

The project will cost a sum of N5,100,000 broken 

down as follows: 

1. Pre-investments 100,000 

2. Plant and Machinery 2,000,000 

3 Accommodation (Rental) 500,000 

4. Utilities 1,500,000 

5. Working capital for take-off 1,000,000 

Total 

N5,100,000 

servative figure of 200 

days in a year will yield 

N14 million net profit on 

annual basis. This is no 

doubt a good source of 

livelihood for Nigerians, 

especially retired civil 

servants, public servants, 

bankers, corporate bodies 

looking for means of livelihood 

and diversification. 

Investors can be assisted 

in the establishment of the 

project.



32 Start-Up DIGEST 

Mentoring Notes 

Tourism: The diamond in the dirt 

Wa n l e 

A k i n - 

boboye, 

founder 

of La 

Campagne Tropicana 

Beach Resort, Ikegun, 

Lagos, is a man of many 

firsts. A true visionary 

and entrepreneur, he has 

taken tourism in Nigeria 

by storm through his 

numerous projects and 

made an indelible mark 

in a hitherto undefined 

and under-exploited industry. 

His interventions 

span about 30 years since 

returning to these shores 

after a study stint in the 

United States. 

Akinboboye’s La Campagne 

Tropicana has 

been described as a beach 

resort that is entirely an 

African themed enclave 

but enjoys a blend of natural 

and sophisticated 

aesthetics. In 2013, it was 

named the best beach 

resort in Nigeria and in 

2014 it was named the 

best beach resort in West 

Africa in the annual Africa 

Travel Award organized 

by Akwaaba. 

Tourism, as an enterprise, 

made very little 

sense when the 29-yearold 

Akinboboye made 

his entrance and almost 

everyone he approached 

had one major reason or 

the other why it could not 

be done. But like a true 

Wanle Akinboboye 

entrepreneur, he persevered, 

and today, La 

Campagne Tropicana is 

a shining example of a 

beach tourism enterprise 

in Nigeria. 

Wanle Akinboboye’s 

The seven laws of ideas 

As far as Nigeria is concerned, one can 

safely say no understands the subject of 

branding as much as charismatic branding 

maestro and founder of Alder Consulting, 

Leke Alder. 

Recently, Mr Alder was at Covenant Christian 

Centre’s intellectual fair The Platform, Abuja on 

May 1st where he spoke about how entrepreneurs 

can improve themselves, identify and execute 

business ideas successfully. “If you can generate 

N1000 you can generate $100 million. All you 

need is intelligence and doggedness,” he opined 

during his session. 

The creative expert also shared seven foundational 

pieces of intelligence to act upon to 

transform intangible thoughts into multimillion 

dollar revenue streams. According to Adegoke 

Oyeniyi, the founder of Enterprise54. 

com, a pan-African entrepreneurship intelli- 

MENTOR TIPS 

gence media agency, these seven principles can guide 

a young entrepreneur in the transition from idea to 

business. 

•Ideas need a worthy host - someone to incubate 

and nurture it. Ideas always look for worthy hosts and 

can depart if not taken seriously. 

• Ideas take over the life of the host. All successful 

ideas are run by people who are totally, totally committed 

to what they do. You must be totally committed. 

•Ideas become you. That’s why companies take on 

the persona of their founders. Only Richard Branson 

can start an airline, call it Virgin and get away with it! 

•Ideas like to multiply. 

•Nothing is impossible to ideas. Just think big. 

Ideas don’t know impossibility. 

•An idea cannot grow bigger than the host. Expand 

your mind. God has no problem with thinking. You 

cannot accommodate a large vision with a small mind. 

passion for the promotion 

of African culture as well 

as his strides in tourism 

has distinguished him on 

a global scale. He became 

the ambassador for tourism 

for the World Conference 

of Mayors in 2010 

and currently doubles as 

special adviser on tourism 

to the governor of 

Ondo State, among others. 

But he wasn’t nearly 

done. He went on to start 

the La Campagne Club, 

Ikeja, Atunda Entertainment, 

Corporate Guards, 

and Motherland Beckons 

– a platform designed to 

sell Africa to the world, 

urging Africans in diaspora 

as well as individuals 

interested in Africa 

worldwide to visit Africa 

on a recurrent basis. 

Success is a magnet, 

though. The US-trained 

tourism enthusiast was 

visited in his Akure base 

recently by an envoy from 

the government of Cote 

d’ Ivoire. Their mission 

was to present a request 

by President Alhassan 

Qattarato to the Ondo 

State Governor, Olusegun 

Mimiko, to release 

Otunba Wanle Akinboboye, 

his special adviser 

on tourism, to help in the 

development of the country’s 

tourism sector. 

According to the envoy, 

Cote d’Ivoire – an 

agricultural giant and 

largest producer of cocoa 

in Africa - is looking to 

diversify its economy with 

focus on tourism as a veritable 

source. The country 

had last year signed 

an agreement Akinboboye, 

for the building of 

African-themed resorts 

(a replication of La Campagne 

Tropicana Beach 

Resorts) in different locations 

across the country. 

He had also been honoured 

in Cote d’Ivoire 

with a chieftaincy title 

– Chef Ole Tribu de Paouflor 

Izuerioula Region de 

Marahoue, which comes 

with responsibility of superintending 

over 151 

villages in the region de 

Marahoue. 

Across Nigeria, Akinboboye 

is seen not only 

as a resort owner and 

job creator, but a talent 

moulder as well. Over the 

years, he has nurtured interests 

in resort development, 

entertainment, and 

fashion. He even works 

in rural communities as 

a philanthropist. Some of 

his major discoveries are, 

‘the drummer girl’, ‘Aralola 

Olamuyiwa’ popularly 

known as ‘Ara’; and ‘Oluwatoyin 

Oluwaferanmi 

Akinola’ also popularly 

called ‘Afe Onikoko,’ who 

like her predecessor is 

a marvel to watch as a 

world-class artist. 

While we cannot begrudge 

the Ivorians their 

appreciation and pursuance 

of mastery, one can 

only hope that the governments 

of the remaining 

35 states and indeed 

the Federal Government 

of Nigeria do not fail to 

avail themselves of the 

potentially huge revenue 

to be made from standard 

tourism. Better still, we 

hope local entrepreneurs 

can emulate the steps of 

Akinboboye. Tourism is a 

diamond in the dirt. 

NOTE: This article 

was developed by Lara 

Sanni. For information/ 

inquiries on entrepreneurship 

in Nigeria and the 

Mara Mentor initiative, 

email:support@mentor. 

mara.com. You can also 

join the largest entrepreneurship 

community in 

Nigeria on www.mentor. 

mara.com or download 

the Mara Mentor app on 

Android, Apple, Blackberry 

and Nokia stores.


35



CITYFile 

Fashola urges artisans to 

take insurance policy 

JOSHUA BASSEY 

Governor Babatunde Fashola of Lagos 

State has urged tradesmen and artisans 

operating in the state to take insurance 

policies against risks associated with 

their businesses in order not to shut down 

their businesses in the event of occurrences 

that are beyond their capacities to handle. 

Fashola spoke at the 6th Tradesmen and Artisans’ 

Day, in Lagos, an event marked annually 

by the state ministry of commerce and industry 

with the aim of bringing the artisans into the 

formal economy, and better position them to 

benefit from training programmes to better 

and sharpen their skills for greater productivity. 

The Tradesmen and Artisans’ Day celebration 

was initiated in 2010, and so far, 

thousands of them have benefited from 

training programmes organised by the 

ministry in collaboration with Lagos State 

Technical & Vocational Education Board 

(LASTVEB). 

According to the governor, with the impressive 

performance being recorded by 

the artisans and tradesmen, it was necessary 

that they begin to gradually move away from 

old beliefs and embrace new ways of doing 

business and sustaining the growth, by taking 

insurance policies. 

The governor also called on the artisans 

and tradesmen to organise themselves into 

clusters, adding that it was easier for them 

access and benefit from government’s programmes 

as a group than as individuals. 

“Clustering together will enhance exchange 

of ideas among you,” Fashola stated. 

Oluseye Oladejo, the special adviser to 

Fashola on commerce and industry, while addressing 

the group, the said that a total of 9,780 

artisans and tradesmen drawn from different 

registered associations had been trained on 

vocational skills. According to Oladejo, of this 

figure, 2,000 had recently gone through eightweek 

intensive training. They were presented 

with certificates of completion. 

Bola Sanusi, president of Lagos State 

Council of Tradesmen and Artisans (LAS- 

COTA), however, placed some demands 

before the government including the need 

to complete the Gberigbe enterprise zone 

with standard workshops for the artisans. He 

explained that if completed, the workshop 

would reduce the costs of their operations. 

NDLEA raids Indian hemp 

joints in Benin 

IDRIS UMAR MOMOH, Benin 

Edo State command of the Nigeria Drug 

Law Enforcement Agency (NDLEA) 

has arrested over 30 persons in Benin 

in connection with alleged dealing on cannabis 

drugs. 

CityFile gathered that the operation was 

carried out by the armed unit of the antidrugs 

agencies. 

The raid was however said to have 

caught some dealers and consumers of 

marijuana cannabis, popularly known as 

“Indian hemp”, unaware. 

Some of the popular joints raided by 

NDLEA include Ugbiyoko, Upper Ekenwan 

Road by Power Line, Ekenwan Park, popular 

Dekin spot off Owina among others. 

Residents within the affected areas commended 

the command for rising up to its 

responsibility in view of the ongoing reports 

of cult clash which has left no fewer than 25 

persons dead. 

The officials were also said to have seized 

several bags of India hemp. 

One of the residents at Owina area, 

off Ekekhuan Road, simply identified as 

Dickson, who witnessed the operation, 

described the arrest as timely. 

The new waste sorting facility at Solous in Alimosho area of Lagos. 

10mw expected from waste 

recovery facility in Lagos 

JOSHUA BASSEY 

A 

waste recovery facility that 

enables sorting and conversion 

of waste into other useful 

materials has begun operation 

in Lagos. 

The facility, which is being developed 

in phases, is sited within the Lagos Waste 

Management Authority (LAWMA) landfill 

site, Solous in Alimosho. It would see the 

investor, West Africa Energy in partnership 

with Lagos State government, graduating 

from waste recovery (first phase) to 

the production of energy (2nd phase) and 

organic fertiliser (3rd phase). 

The company intends to complete the 

cycle in 2020 when, according to them, 

they would make Alimosho landfill-free. 

No fewer than 130 skilled and unskilled 

labour and waste collectors would be 

required to keep the facility running. 

According to Paul O’Collaghan, chief 

executive officer of West Africa Energy, 

at least 10 megawatts of electricity, would 

be produced from the waste dump from 

the middle of 2016. About $20 million is 

to be invested in the energy production 

alone. “Our vision is to make Alimosho 

landfill-free by 2020,” said O’Collaghan 

Babatunde Fashola, Lagos State governor, 

who praised the vision, said it 

would generate more jobs for the locals 

and affordable energy for the immediate 

surroundings. 

“I make bold to say that this first material 

waste recovery facility in Lagos 

Nigeria is to operate on the Built-Operate- 

Manage and Transfer (BOMT), partnership. 

It has tenure of 12 years. 

“The government equity contribution 

was provision of the land for the construction 

of the facility whose aim is primarily 

to ensure waste segregation and support 

Police grapple with rising cases of child theft in A/Ibom 

ANIEFIOK UDONQUAK, Uyo 

The police in Akwa Ibom are currently 

grappling with increasing 

cases of child theft involving 

hoodlums and gunmen invading 

private residences and snatching underaged 

children for reasons yet to be known. 

According to checks by CityFile, several 

children have been stolen and taken away 

from their parents by a syndicate with 

links in neighbouring states where the kidnapped 

children are believed to be sold at 

exorbitant prices to childless couples who 

are in desperate need of children. 

Last year, security operatives smashed 

a syndicate when investigations took 

them to two states including Abia and 

Anambra. A Catholic priest was allegedly 

involved and was helping the security 

operatives unravel the circumstances 

leading to the disappearance of some 

children from Akwa Ibom. A notorious 

child kidnapper was also arrested by the 

security operatives in the process. 

The police have also made several 

arrests involving some parents allegedly 

selling their babies while a baby factory 

was also uncovered in the state. Two 

weeks ago, two children were snatched 

from their parents when gunmen invaded 

a private residence in Nsit Ubium local 

government area of the state as the children 

were asleep in the night. 

According to police sources, gunmen 

invaded a compound in Ikot Akan, Nsit 

Ubium local government, gained access 

to the rooms in which the children were 

sleeping and made away with two children, 

Beauty Inyene Achibong, aged four 

years and the landlord’s child. That was 

on March 24 this year, the source added. 

Further investigations showed that 

the Beauty was later found abandoned 

the PSP programme in the state provides 

easy access to waste for the company from 

Solous landfill sites.” 

The governor said the facility would 

provide raw materials for plastic paper 

and metal manufacturers throughout Lagos 

and beyond in commercial quantities. 

He added that in addition to job creation, 

the facility supports the immediate environment 

technically, educationally and 

financially as industrialists and students 

could visit and learn more about waste 

management. 

”This is multi-use facility that receives, 

separates and prepares recyclable materials 

for the end user manufacturers,” 

he said. 

Ola Oresanya, managing director, 

LAWMA said that with the completion 

of the facility, the dream of generating 

power for the state through waste soon 

be actualised. 

in a ‘no man’s land’ in the boundary between 

Abia and Akwa Ibom States near 

Ukwa East local government area of Akwa 

Ibom State. 

Police sources in the child and welfare 

department of the Akwa Ibom State police 

command who confirmed the incident 

said that an Okada rider, Michael Adienyongwe 

from Azumini Ndoki in Ukwa East 

local government area of Akwa Ibom State 

found the child crying by the roadside. 

According to the source, policemen 

from the criminal and investigation 

department (CID) of Akwa Ibom police 

command were drafted to the place by 

Gabriel Achong, the state commissioner 

of police, adding that “that was how 

Beauty was recovered and reunited with 

the family.” 

Sadly, the landlord’s child that was 

kidnapped same day with Beauty has not 

been found, the police said.


37



This is M NEY 

A daily guide to your Personal Finance 

• Savings 

• Travel 

• Debt & Borrowing 

• Utilities 

• Managing your Tax 

Insurance can help fund befitting 

funerals for one’s parents 

...as Leadway launches family benefit plan plus 


Burial ceremonies 

and the 

associated expenses 

are a 

huge burden 

for many families, particularly 

in this part of the 

world. When it is for aged 

parents, the glamour and 

fanfare that follow it not 

only hit the purse but become 

an issue of worries 

when the wherewithal is 

not there. 

Many times, people are 

forced to borrow or sell 

their properties to meet 

a burial expense, which 

therefore makes this natural 

demand an important 

expense that should ordinarily 

be provided for. 

Here, insurance has 

come with a reprieve, 

not just to give you rest 

of mind to go about your 

normal business, but 

to provide you with the 

needed fund to give your 

making life beautiful for its 

customers. 

Also speaking at the 

product launch held at the 

Corporate office of Leadway 

Assurance in Lagos, 

Shadrack Sivhugwana, the 

general manager, life diviaged 

parents a befitting 

burial when they pass on 

without having to worry. 

And where you pass on 

before the beneficiary 

parents and spouse, the 

insurance cover takes 

care of your dependants 

for a certain period of 

time. 

Leadway Assurance 

Company Limited, well 

aware of this challenge, 

has launched a new Life 

product named the Leadway 

Family Benefit Plan 

Plus(LFBPP). 

The product is a multilife 

policy designed to 

cover funeral expenses for 

the assured lives (spouse, 

parents and/or parentsin-law 

that are named in 

the policy) and the policy 

holder (person who purchased 

the policy). The 

policy helps to alleviate 

and bury the worries associated 

with the funerals 

for elderly loved ones. 

Giving details of the new 

product, Femi Adebayo, 

head, life retail, explained 

that the policy provides funeral 

benefits in respect of 

all the assured lives as long 

as their death precedes 

that of the policyholder. 

The policy also provides 

other benefits including 

offering additional monthly 

payments to the beneficiaries 

of the policyholder 

in the event of his demise. 

The Family Benefit Plan 

Plus, in his own words, was 

one of the ways in which 

Leadway Assurance was 

sion, said he expected that 

the “…demand for funeral 

insurance will be the main 

driver of insurance growth 

in Africa in the next couple 

of years.” 

He therefore invites the 

public to take advantage 

of the new product and be 

prepared when the inevitable 

happened. 

Established over 45 

years ago, Leadway is 

a composite insurance 

company underwriting 

both Life and General 

Insurance business with 

23 branches spread across 

Nigeria. 

Leadway’s reputation 

has been attained by the 

continuing pursuit of improvements 

to maintain 

its competitive advantage 

within a very soft market 

environment. The company 

also offers subsidiary 

financial services like 

Bonds, Secured Credit, 

Miscellaneous financial 

losses and Fund/Portfolio 

management. 

Contentment should not be taken as complacency 

Contentment is the 

ultimate financial 

principle that 

everyone should 

have. Being content with 

what your situation, the 

stuff you already own, and 

the career you already 

have, is such an amazing 

skill to practise, but do not 

confuse contentment with 

complacency. 

Being content with what 

you have doesn’t mean you 

can simply sit back and 

wait for life to happen to 

you. There’s a difference 

between feeling satisfied 

and happy with what you 

have, and simply giving up. 

Strive for financial 

freedom 

The point of my article 

last week was not to 

encourage giving up on 

financial goals. It’s not 

healthy to say, “I can never 

make X amount of money, 

so I’ll just stop trying.” 

Instead, you should be 

happy with what you have 

already been blessed with, 

while still striving for financial 

security and freedom. 

Have financial goals and 

stick with them, while being 

content in your current 

situation. 

This process will look 

different for all of us. Sure, 

it would be nice to have a 

larger home and a bigger 

paycheque, but I’m not going 

to wait for those things 

to come before I start loving 

my life. 

Yet on the other hand, 

I’m not going to stop putting 

money away for a new 

home, or give up on reaching 

other financial goals. 

Whether I reach my financial 

goals or not, I will be 

content (well, practising 

contentment — it is an ongoing 

battle, amen?). 

Happiness is not found 

in money 

The most important 

thing to remember is that 

your happiness is not tied 

to your money or material 

possessions. You will 

always find people living 

below poverty and people 

making millions who share 

one thing in common — 

they are discontent with 

what they have. 

The point is that you 

will not be happier once 

you pay off debt, once you 

pay off your house, or once 

you make a million dollars. 

Why? Because while those 

are all wonderful financial 

goals to strive for, they 

should not be the determiner 

of your happiness 

and attitude. 

Change your mindset 

Maybe if we take a step 

back from the dollar signs 

and look at contentment 

in another area of life, it 

will be easier to see how 

it applies to our finances. 

Let’s talk about weight loss, 

since that is on my brain 

due to just having a baby 

two months ago. 

No matter how much 

you weigh, it is healthiest 

to be content with who you 

are. This doesn’t mean you 

should say that you love 

yourself as you are and 

keep shoving Twinkies in 

your mouth. 

Instead, it should be 

recognised as more of a 

process of being happy 

with yourself, while pursuing 

a healthier path for 

health’s sake, rather than 

always wishing you were 

someone else or thinking 

that you’ll be more 

happy/organised/a better 

person/etc. once you lose 

50 pounds. I’m sure we all 

know of people who have 

lost weight and still battle 

with loving themselves. 

Contentment does not 

mean giving up 

I truly hope this makes 

sense because financial security 

and freedom is more 

than just a number’s game. 

Many of us have money issues 

that are deeply tied to 

our emotions, and if we do 

not take control of them we 

will never experience true 

joy in life. 

Contentment is about 

being satisfied in who we 

are as people and with the 

blessings we already have. 

Don’t stop striving to pay 

off debt. Keep saving your 

money and investing so 

you can have a well-funded 

nest egg.Just remember 

that you shouldn’t 

wait to be content until 

all of your financial goals 

are met. An extra million 

dollars will not cure a discontent 

heart.


This is M NEY 


• Savings 

• Travel 


• Utilities 


BUSINESS DAY 

39 

How to learn from 

your budgeting 

mistakes 

Every one of us 

has made mistakes 

with our 

money, and we 

will continue 

to make mistakes in the 

future. These are indisputable 

facts. However, 

the way we react to these 

mistakes is critical in our 

ability to grown and improve 

as human beings. 

We all encounter 

budget failures caused by 

overspending. The same 

methodology can be applied 

to financial budget 

failures to learn from our 

failures. We can use these 

lessons grow stronger, 

and avoid repeating the 

mistake. 

My personal mistake 

For example, a person 

training for a marathon 

runs much longer one 

day out of each week. 

I’m currently training 

for my fifth marathon, 

and I choose to have my 

long runs on Saturday. 

My training has been going 

extremely well, and 

when I left my driveway 

at 8:30am last Saturday I 

had no reason to believe 

my 16 mile run would be 

any different. 

Unfortunately, after 

only a few miles I could 

tell my mind wasn’t in 

the right place. My mental 

state deteriorated 

from there, and I actually 

ended up ending my run 

after 13 miles. My body 

and brain were completely 

exhausted. 

It was at that point I 

had a choice to make. I 

could either wallow in my 

failure, or I could reflect 

on what caused that run 

to fail. Thinking back, I 

realised I had overdressed 

for the morning weather 

which was 15 degrees 

warmer than the days 

previous. 

I also thought about 

how I didn’t go through 

my usual stretching routine 

as I was in a hurry to 

get started. I remembered 

downing a huge bottle of 

Gatorade six miles into 

the run, whereas I usually 

drink small amounts at a 

time. I had not followed 

my usual routine, and all 

of those things may have 

contributed to my run not 

going as planned. 

If you find yourself in 

a similar situation with 

your budget, here are 

some ways to overcome a 

mistake before it gets too 

far gone. 

Identify the mistake 

Ask yourself what was 

different during the time 

frame of the budget failure. 

If you’re successful 

most weeks, but every 

now and then you overspend, 

focus on what was 

out of the ordinary. 

Here are some of 

common ones that have 

caused me trouble in the 

past: Did you forget to 

plan your meal causing 

you to eat out? 

Did you have an unexpected 

car maintenance 

expense? 

Did you forget about 

an event or celebration 

that used up some of your 

funds? 

Did you not track 

spending causing you to 

exceed your self-imposed 

spending limit? 

Plan for the future 

Next, identify what 

you’re going to do to prevent 

the same mistake 

from happening again. 

Whether it be forcing 

yourself to meal plan as 

part of your grocery shopping, 

or putting events on 

a big calendar on your 

refrigerator door take action 

to ensure your success. 

Recovering from a 

budget failure, and learning 

from it are two very 

different activities. Recovering 

means you are 

able to cut spending in 

another area to make 

your budget whole again. 

That’s great, but without 

identifying the root cause 

of why, and how, you 

broke your budget, you 

are doomed to repeat the 

same mistake.



This is M NEY 


• Savings 

• Travel 


• Utilities 


Battling to conquer 

challenges of financial goals 


Life has never 

been easy no 

matter how you 

look at it. People 

who have 

achieved greatness in life 

have at one point or the 

other encountered one 

challenge or the other, 

and it is their ability to 

counter these challenges 

that make them great. 

Therefore, in pursuing 

your financial goal, be 

ready to meet some uncommon 

challenges and 

also make up your mind 

to face them squarely to 

be able to get to the next 

level. 

In appreciating these 

challenges, which most 

times are called problems, 

we are ordinarily 

weighed down and feel 

discouraged. Some people 

at this point lose hope 

lem Solving and Decision 

Making” presented 

by Rajive Sharma at one 

of Phillip Consulting 

Training Series, problem 

is described as “an 

obstacle which makes 

it difficult to achieve a 

desired goal, objective 

or purpose. It is also referred 

to as a situation, 

condition or issue that is 

yet unresolved. 

While problem solving, 

is the act of narrowing 

down the possibilities, 

choosing a course of action, 

and determining the 

action’s potential consequences. 

According to Sharma, 

in solving any problem, 

the first step is to agree 

that there is a problem 

and concluding whether 

it needs to be resolved; 

second stage is take responsibility 

of the problem 

by putting energy 

and communicating authority; 

the third stage is 

and fall by the wayside. 

But those who are determined 

to succeed see 

these obstacles or challenges 

as part of the building 

process that must be 

surmounted to get to the 

next level.Jim Collins, 

prolific writer in one of 

his books, called this situation 

one that must be 

conquered. He described 

as “Confrontation of Brutal 

Facts”. Meaning, facing 

the problem headlong 

without fear and getting 

solution that would enable 

you move on with 

your goals. 

Experts who have 

identified problem as 

part of the growing process 

said there is always a 

solution, and that is why 

people who made discoveries 

succeeded in their 

ventures, otherwise no 

process has been without 

challenges. 

In a course titled 

“Critical Thinking: Probdefining 

the problem by 

asking critical questions 

like - Who caused the 

problem, what will happen 

if the problem is not 

solved, where does the 

problem occur, when 

does the problem occur, 

why is the problem occurring 

or how should 

the process or system 

work? 

In providing these answers, 

it is already clear 

what to do with the problem, 

having known that 

root cause then solution 

is near. As you climb you 

ladder of financial goals, 

don’t be discouraged by 

challenges and obstacles, 

find solution to the confronting 

problems and 

move on. 

Why living in a tiny house is better 

The American 

Dream has always 

been based around 

the ideal of home 

ownership, with the idea 

that bigger is better. In fact, 

last year’s statistics show 

that the average American 

home is 2,600 square feet, 

up from 2,400 during the 

housing boom years. 

But even though average 

home sizes are increasing, 

there’s a small but growing 

trend in the opposite direction: 

tiny houses. Documentaries 

on tiny house dwellers 

highlight the incredible contrast 

between the average 

American home and the 

average tiny home, which 

is less than 500 square feet. 

Although tiny homes still 

account for less than 1 percent 

of real estate sales, their 

appeal is increasing among 

many people who are tired 

of upside-down mortgages, 

the cost and time consumption 

of accumulating and 

maintaining 2,600 square 

feet of possessions, and have 

a desire to live a simpler 

life.Even if you’re content 

to keep living the American 

Dream, consider these four 

financial advantages of living 

in a tiny home. 

Freedom from debt 

Some statistics indicate 

that as many as 65 percent 

of tiny home dwellers have 

no credit card debt, whatsoever. 

Furthermore, 68 

percent don’t have a mortgage 

payment. At an average 

of $23,000, self-built tiny 

homes are cheaper (and nicer) 

than traditional housing 

options in that price range, 

and are designed to last as 

long as full-size houses. 

Not only do tiny houses 

themselves cost less to build 

or purchase, since storage 

space is minimal, they provide 

freedom from excess 

consumerism (the pursuit 

of which often plunges people 

into debt). 

Those who choose to live 

in tiny homes must choose 

their possessions carefully, 

a lifestyle that naturally results 

in less spending, less 

accumulation of stuff, and 

consequently, less debt. 

Not only this, but the 

cost of storing, shopping for, 

and replacing items drops 

significantly, freeing up the 

household budget as well as 

the schedule. 

Lower overhead expenses 

With less than 500 square 

feet of space to heat or cool, 

utility bills commonly run 

under $20. Add to this the 

reduction of property taxes, 

large appliances, other 

equipment, and home repair 

expenses, and your 

household budget looks 

even better. 

Even the grocery bill 

goes down — with less 

storage space, a tiny home 

discourages hoarding or 

excess accumulation of 

food and consumables. 

Your entire overhead decreases 

when you live in a 

tiny house. 

Freedom to spend 

Wait, didn’t I just mention 

that tiny homes discouraged 

consumerism? 

Yes, but with more leeway in 

the budget due to less debt 

and lower expenses, there 

will be more freedom to 

spend and save in ways you 

want to, rather than ways 

you have to. 

For instance, some retirees 

may find it beneficial to 

have more money to save for 

their rising healthcare costs 

or to invest more money into 

their IRA. Younger people 

who want to travel may 

likewise have the funds to do 

so without going into debt. 

Impacting others and 

the economy 

After Hurricane Katrina, 

tiny homes became a popular 

construction strategy 

for relief organisations who 

found them to be more durable 

than trailers. In the last 

decade, many non-profit 

organisations have been increasingly 

utilising them as 

a cost-efficient way to fight 

homelessness and the need 

for low-income housing. 

Even though many 

homeowners are worried 

about the impact of tiny 

homes on their property 

values or taxes, they may, in 

fact, boost the economy by 

leading to more land development, 

and increase current 

property values because 

of their effect on density. 

Advantages to living in 

a tiny house 

Regardless of your personal 

preferences or space 

needs, the cost-efficiency 

and other advantages of tiny 

houses can’t be denied. 

Considering this, it’s no 

wonder more people are 

turning away from “The 

American Dream”, which 

has sadly led to oppressive 

consumer debt, and deciding 

to live large in a whole 

new way.


This is M NEY 


BUSINESS DAY 

• Savings 

• Travel 


• Utilities 


41 

Money mistakes that (mostly) women make 

We all make 

money 

mistakes, 

but some 

bad financial 

moves seem to 

be more characteristic of 

women. I’m sure there are 

plenty of male-specific 

money mistakes too, but 

as a woman, I can probably 

write better about my 

own gender. So here they 

are – money mistakes that 

women tend to make. 

Spending too much 

on clothes and shoes 

If you’ve read my previous 

posts on this blog, you 

already know I believe that 

Women Should Save More, 

and Spend Less on Designer 

Shoes. It’s not that looking 

good or being fashionable 

are not important 

– it’s just that it’s absolutely 

possible to look great on a 

budget, and buying into 

the “you must spend ridiculous 

amounts of money 

on clothes or you won’t get 

a promotion” theory is, in 

my opinion, a big mistake. 

Expecting a 2-months’- 

salary engagement ring 

Seriously, the only people 

who benefit from the 

“two months’ salary” rule 

are the people in the diamond 

and jewelry industries. 

It’s a stupid rule that 

begs to be broken. Who 

in their right mind would 

spend 2 months’ salary on 

a ring? 

If you’re financially well 

off, own your house, have 

a big emergency fund and 

nice size nest egg, great – by 

all means spend as much 

as you want on a ring. But 

for the average couple, taking 

such a huge chunk of 

money and putting it into 

something that is likely going 

to depreciate, instead of 

putting it in an emergency 

fund or as a down payment 

on a house, just doesn’t 

make sense. And buying 

that ring with credit is even 

worse. 

Competing with Mrs. 

Jones 

I’m including this in the 

list even though men fall 

for it too, because I believe 

that women compete on 

different things than men. 

Men probably compete 

more than anything else 

on the cars they drive, but 

women focus more on the 

house. Both are of course 

mistakes, and both are very 

human – but it’s good to be 

aware of our tendency to 

spend more just to keep up 

with the Joneses and avoid 

it when possible.Engaging 

in Recreational shopping 

and in “retail therapy” 

Extremely common 

among women, these behaviors 

are destructive and 

can burn serious amounts 

of money in a short time, 

or – worse – get women 

into debt. Have you seen 

the movie Confessions of a 

Shopaholic? 

It’s not a very good 

movie, but it’s entertaining 

and it really captures the 

pleasure that shopping can 

bring, and the deep trouble 

it can cause. I’ve recently 

read that many women 

have clothes in their closets 

that still have tags attached, 

and that many of them hide 

purchases from their husbands. 

That’s insane! 

Relying on marriage to 

save them 

You can’t build a huge 

debt, consistently spend 

more than you earn and tell 

yourself that it will all work 

out once you get married. 

What if you never get married? 

What if you fall in love 

with a poor man? What if 

he ends up leaving you and 

stops supporting you financially? 

Do you really want to 

be dependent on another 

person for your survival? 

Women in the past were 

completely dependent on 

their fathers, then on their 

husbands. We’ve worked 

hard to free ourselves and 

become financially inde- 

pendent. Do you really 

want to rely on another person 

to save you from your 

own mistakes? If you’re an 

adult, you should be able 

to take care of yourself, and 

that includes handling your 

finances – responsibly. 

“Playing nice” at work 

This is a tough one. It’s 

been shown in research 

after research: women ask 

for less than men at work, 

and as a result they get less. 

They’re also less assertive 

when it comes to asking for 

promotions and raises. We 

women tend to be less confident, 

and we feel that we 

must play nice. The problem? 

There are other studies 

that show coworkers and 

employers indeed expect 

women to play nice, and 

that assertive behavior is 

seen as unattractive and 

a turnoff when a woman 

displays it, but not so when 

displayed by a man. 

So what is a woman 

to do? It’s hard to say for 

sure, but if you can manage 

to ask for more – nicely 

– I guess that would be the 

way to go. Personally, I find 

this need to walk a fine line 

between getting what you 

want while keeping your 

“femininity” and demanding 

it like a man infuriating. 

If I want a raise, why can’t I 

just go to my boss and tell 

them “I don’t make enough 

money to properly take 

care of my family. I need a 

raise?” 

In addition, there’s also 

the notion that unfortunately 

many women and 

their employers share: that 

a woman is the secondary 

provider and so her income 

is less important. This 

couldn’t be further from he 

truth, especially in turbulent 

financial times – a family 

where both partners are 

good earners is much less 

at risk of losing everything 

if one of the partners loses 

their job.


42 BUSINESS DAY


BUSINESS DAY 

Cowry Weekly Financial Markets Review & Outlook 

 

Nigeria’s Q1 2015 real GDP Growth Slows to 3.96% 

amid Sustained Rise in Inflation... 

In the just concluded week, the National Bureau of Statistics published major 

macroeconomic indicators which mirrored the prevailing challenges. On the one hand, 

the local economy saw slowed growth in real Gross Domestic Product (GDP) amid 

sharp decline in global crude oil prices which negatively impacted on contribution of oil 

and gas in the review period. On the other hand, inflation rose at a faster pace following 

the devaluation of the local currency relative to the U.S. Dollar – thus increasing the 

cost of imported items. In Q1 2015, the real GDP grew year-on-year by 3.96% to N16.05 

trillion in the first quarter of 2015. The growth rate was slower than 5.94% recorded in 

the preceding quarter. In nominal terms, GDP grew by 4.32% to N21.04 trillion in the 

review period. Slowdown in growth was mainly attributed to worsened performance in 

the oil sector (output declined by 8.15% in Q1 2015, worse than 6.61% in Q1 2014) amid 

plummeted global crude oil prices. The services and agricultural sectors saw increased 

growth and contribution to real GDP. However, the industrial sector saw declines in 

both contribution and growth. In the services sector which witnessed a 4.70% growth, 

contribution to real GDP increased to 54.56% of total output (higher than 52.99% in 

Q1 2014). Trading activities accounted for 17.77% of real GDP (better than 17.35% in 

Q1 2014) having grown by 6.47% while information and communications activities 

contributed 11.47% to real GDP (higher than 10.89% in Q1 2014) following year-onyear 

growth of 9.49%. Industrial sector which recorded negative growth of 2.53% 

contributed 25.65% (lower than 27.36%). Mining and quarrying activities – of which 

crude oil & natural gas accounts for 98.49% – contributed 10.61% to real GDP (lower than 

11.98%) having registered a 7.91% decline in output while manufacturing accounted 

for 10.20% (lower than 10.68% in Q1 2014) having registered a 0.70% growth in output. 

The agricultural sector grew by 7.04% and contributed 19.79% to real GDP (higher than 

19.65%). Growth in the agricultural sector was propelled by crop production, livestock 

production and fishing. Similarly, inflation rate increased year-on-year to 8.7% in 

April, faster than 8.5% in March. The increase in inflation rate was mainly driven by 

Core Inflation which increased to 7.7% in April, from 7.5% in March. Food Inflation 

also rose to 9.5% in April, higher than 9.4% registered in March as a result of increases 

in most of the groups that constitute the food index. Imported food inflation rose to 

9.42% in April, stronger than 9.21% in March. The afore-stated numbers suggest that 

Nigeria’s oil export based economy appears poised for further slowdown in the short 

run as weakened revenues and increased inflation are likely to impact negatively on 

consumption. Thus, debt may be required to finance investment initiatives needed 

to spur growth. On a positive note, however, Nigeria may benefit from forecast 

improvement in global oil market conditions, which according to OPECs’ monthly oil 

market report for May, suggests likely boost in global crude oil demand. Global demand 

in 2015 is projected to rise by 1.18 million barrels per day (stronger than 0.96 mbd 

growth in 2014). Meanwhile non-OPEC oil supply growth is expected to grow by 0.68 

mbd (lower than 2.17 mbd in 2014). Thus, expected demand for OPEC crude in 2015 

has been revised upwards by 0.3mbd to 29.3 mbd. Nigeria’s external reserves rose weekon-week 

by 0.37% to USD29.78 billion as at Thursday 14, 2015 amid increase in global 

crude oil prices – OPEC’s reference basket price climbed by 1.11% to USD63.13 a barrel. 

Equities Market Recovers by 15Bps on Non 

Financial Equities… 

In line with our expectation, the equities market closed in the positive having 

witnessed renewed bargain hunting activities. The overall performance measure, 

the NSE ASI firmed by 15bps to 34,429.52 points while market capitalisation 

rose by N18.57 billion to N11.69 trillion. Non financial stocks generally closed 

in the green – the NSE Consumer Goods Index revved by 0.66% to 864.08 points; 

the NSE Oil/Gas Index rose by 0.62% to 381.84 points; while the NSE Industrial 

Index increased by 0.14% to 2,217.2 points. However, the NSE Banking Index lost 

0.19% to close at 396.51 points while the NSE Insurance Index fell by 0.14% to 

146.91 points. Skye Bank Plc (FY Dec 2014), a deposit money bank, announced 

a 3.29% increase in gross earnings to N136.74 billion; however Profit After 

Tax declined by 47.44% to N9.74 billion. The decline in bottom line mainly 

reflected a 58.21% increase in loan loss expenses to N18.99 billion. Similarly, 

National Salt Company of Nigeria (FY Dec 2014), a producer of refined salt, 

declared a 3.81% increase in turnover to N11.25 billion while Profit after Tax 

declined by 30.84% to N1.86 billion. This week, we anticipate sustained positive 

performance in the equities market amid bargain hunting opportunities. 

Naira Remains Steady at Most Market Segment… 

In the just concluded week, the foreign exchange markets experienced relative 

calm, week-on-week at most market segments. The local currency appreciated against 

the US Dollar at the parallel or “black” market segment rising by 0.23% to close at 

N221/USD from N221.5/USD as at Thursday May 14. The CBN clearing rate, interbank 

rate and Bureau De Change rate held steady at N197/USD, N199.10/USD and N220/ 

USD respectively. Meanwhile, the Central Bank initiated talks with banks and other 

non-bank financial institutions on how to loosen FX trading restrictions amid fears on 

the long run stability of the Naira and threat to external reserves. Also, the Financial 

Markets Dealers Association announced its intention to submit proposals to the 

apex bank that will help curb speculative activities. We expect further stability of 

the Naira as the various CBN’s policy measures continues to limit market demand. 

NIBOR Increased amid Tightened Liquidity … 

In line with our expectations, Nigerian Interbank Offered Rates (NIBOR) 

increased for all tenor buckets despite matured 182-day treasury bills worth N81 

billion via open market operations. Week-on-week, NIBOR for overnight funds, 1 

month, 3 months and 6 months tenors advanced to 13.54% (from 9.29%), 14.76% 

(from 13.16%), 15.69% (from 14.42%) and 16.61% (from 15.78%) respectively. This 

week, treasury bills worth N296.13 billion will be auctioned via the primary market 

and open market operations: 91- day bills worth N32.43 billion; 133-day bills worth 

N185.80 billion; 182-day bills worth N22.82 billion and 364-day bills worth N55.68 

billion. On the other hand, treasury bills worth N160.94 billion will mature via the 

primary market and open market operations: 91- day bills worth N32.43 billion; 133- 

day bills worth N50 billion; 182-day bills worth N22.82 billion and 364-day bills worth 

FGN Monthly Bond Auction Yields Decline Month on 

Month … 

In the just concluded week, at the over-the-counter market, Federal Government 

bond prices strengthened amid primary market auctions. The Federal Government 

auctioned N60 billion in 3 different bond denominations: N20 billion in the 5-year 

15.54% FGN FEB 2020 bond (yield fell to 13.85% from 14.45%), N20 billion in the 

10-year 14.20% FGN MAR 2024 note (yield declined to 13.48% from 14.22%) and 

N20 billion in the 20-year 12.1493% FGN JUL 2034 paper (yield moderated to 

13.88% from 14.46%) respectively. At the OTC market, the 10-year, 16.39% FGN 

JAN 2022 paper advanced by N1.18 (yield fell to 13.49%); the 7-year, 16.00% FGN 

JUN 2019 note appreciated by N0.47 (yield decreased to 13.59%); the 5-year, 15.10% 

FGN APR 2017 bond rose by N0.23 (yield fell to 13.63%); while the 3-year, 13.05% 

FGN AUG 2016 bond gained N0.24 (yield declined to 13.59%). However, the 20- 

year, 10.00% FGN JUL 2030 bond lost N0.06 (yield rose to 15.46%). Also, Federal 

Government Eurobond prices on the international capital market declined on 

sell pressures. Week-on-week, the 6.75% FGN JAN 2021 note tanked by USD0.12 

(yield increased to 5.19%); the 5.13% FGN JUL 2018 debt lost USD0.03 (yield rose 

N55.68 billion. We expect liquidity enhancement from Federal Accounts Allocation 

Committee funds disbursement and a resultant moderation in interbank rates. 

to 4.08%); while the 6.38% FGN JUL 2023 bond weakened by USD0.20 (yield 

advanced to 5.50%). This week, we expect resumed bargain hunting at the OTC 

market on the back of likely liquidity enhancement from FAAC disbursements. 

Cowry Weekly Stock Recommendations As At Friday 15 May 2015 

Boko Haram Proves That It Is Not Yet 

Defeated… 

In the out gone week, Islamic insurgents, Boko Haram, proved that its 

capacity may have been degraded but it has not yet been defeated as it carried 

out surprise attacks on some communities around Maiduguri, the Borno State 

capital, on Wednesday night, killing about fifty people and destroying properties. 

However, the Nigerian military swiftly responded to the surprise attack, killing 

scores of the Boko Haram members and subsequently imposed a twenty 

four hour curfew on Maiduguri. Meanwhile, President-elect, Muhammadu 

Buhari, and the President of Chad, Idriss Derby, held a closed door meeting 

at the Defence House on Monday to discuss strategies to end the insurgency. 

At the end of the meeting, Muhammadu Buhari revealed that both leaders 

agreed to expedite the commencement of a comprehensive review of the 

security situation in the region as soon as the incoming government kicks off 

as a first step towards restoring regional stability. In another development, 

ahead of May 25 deadline for exchange of handover notes, the All Progressives 

Congress (APC) refuted claims by the Peoples Democratic Party (PDP) that 

the Presidential Transition Committees from both sides had been having 

fruitful meetings – accusing the government’s side of being uncooperative 

by withholding key information on the state of affairs in the nation, in line 

with APC’s terms of reference. With the continued bickering by both sides, 

we are concerned that the planned smooth transition may not be attained 

and the efforts of both committees may be largely unproductive despite the 

recent meeting between President Goodluck Jonathan and General Buhari 

to moderate tensions between both sides of the transition committee. 

Disclaimer 

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

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

securities on the basis of their own investment decision without relying 

completely on the information contained herein. The opinion contained 

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

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

taken in preparing this document, no responsibility or liability whatsoever 

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

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

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

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



LIVE @ THE STOCK EXCHANGE 

Stock Market Update As At Friday 15 May 2015 

Company 

No of 

Deals 

Closing 

Price (N) 

Quantity 

Traded 

Value of 

Shares (N) 

Company 

No of 

Deals 

Closing 

Price (N) 

Quantity 

Traded 

Value of 

Shares (N) 

2ND-TIER SECURITIES 

AGRICULTURE 

Crop Production 

FTN COCOA PROCESSORS PLC 1 0.50 5,000 2,500.00 

OKOMU OIL PALM PLC. 5 28.44 6,070 168,701.00 

PRESCO PLC 33 30.00 260,615 7,834,857.00 

Crop Production Totals 39 271,685 8,006,058.00 

Livestock/Animal Specialties 

LIVESTOCK FEEDS PLC. 3 2.40 60,027 144,064.80 

Livestock/Animal Specialties Totals 3 60,027 144,064.80 

AGRICULTURE Totals 42 331,712 8,150,122.80 

CONGLOMERATES 

Diversified Industries 

A.G. LEVENTIS NIGERIA PLC. 1 1.62 10,000 15,400.00 

JOHN HOLT PLC. 2 0.90 293 251.98 

S C O A NIG. PLC. 4 4.44 11,480 48,445.60 

TRANSNATIONAL CORPORATION OF NIGERIA PLC 128 3.19 22,516,315 72,031,381.00 

U A C N PLC. 43 40.00 221,423 8,866,339.62 

Diversified Industries Totals 178 22,759,511 80,961,818.20 

CONGLOMERATES Totals 178 22,759,511 80,961,818.20 

CONSTRUCTION/REAL ESTATE 

Building Structure/Completion/Other 

COSTAIN (W A) PLC. 8 0.81 9,040 7,350.80 

G CAPPA PLC 1 14.46 69 948.06 

Building Structure/Completion/Other Totals 9 9,109 8,298.86 

Infrastructure/Heavy Construction 

JULIUS BERGER NIG. PLC. 23 51.70 65,462 3,410,406.12 

Infrastructure/Heavy Construction Totals 23 65,462 3,410,406.12 

Real Estate Development 

UACN PROPERTY DEVELOPMENT CO. LIMITED 18 10.25 90,171 936,676.80 

Real Estate Development Totals 18 90,171 936,676.80 

Real Estate Investment Trusts (REITs) 

UPDC REAL ESTATE INVESTMENT TRUST 1 10.00 100 1,000.00 

Real Estate Investment Trusts (REITs) Totals 1 100 1,000.00 

CONSTRUCTION/REAL ESTATE Totals 51 164,842 4,356,381.78 

CONSUMER GOODS 

Automobiles/Auto Parts 

DN TYRE & RUBBER PLC 7 0.50 37,728 18,864.00 

Automobiles/Auto Parts Totals 7 37,728 18,864.00 

Beverages--Brewers/Distillers 

CHAMPION BREW. PLC. 10 7.09 374,459 2,536,688.48 

GUINNESS NIG PLC 42 155.00 158,502 24,485,968.63 

INTERNATIONAL BREWERIES PLC. 17 20.00 2,728,423 54,592,046.95 

JOS INT. BREWERIES PLC. 1 1.92 3,080 5,636.40 

NIGERIAN BREW. PLC. 75 155.18 394,032 60,939,430.67 

PREMIER BREWERIES PLC 1 3.43 438 1,427.88 

Beverages--Brewers/Distillers Totals 146 3,658,934 142,561,199.01 

Beverages--Non-Alcoholic 

7-UP BOTTLING COMP. PLC. 21 176.00 18,853 3,345,059.94 

Beverages--Non-Alcoholic Totals 21 18,853 3,345,059.94 

Food Products 

DANGOTE FLOUR MILLS PLC 31 4.64 116,785 522,568.29 

DANGOTE SUGAR REFINERY PLC 38 6.60 452,243 2,921,891.69 

FLOUR MILLS NIG. PLC. 106 35.00 1,838,359 64,336,489.05 

HONEYWELL FLOUR MILL PLC 33 3.47 1,015,943 3,563,898.29 

NATIONAL SALT CO. NIG. PLC 59 8.00 1,119,039 8,936,213.80 

UNION DICON SALT PLC. 2 11.84 1,092 12,285.00 

Food Products Totals 269 4,543,461 80,293,346.12 

Food Products--Diversified 

CADBURY NIGERIA PLC. 11 39.90 25,309 981,770.99 

NESTLE NIGERIA PLC. 28 900.00 9,182 8,232,524.98 

Food Products--Diversified Totals 39 34,491 9,214,295.97 

Household Durables 

VITAFOAM NIG PLC. 81 6.38 2,273,569 14,330,196.43 

VONO PRODUCTS PLC. 4 0.94 86,049 80,911.06 

Household Durables Totals 85 2,359,618 14,411,107.49 

Personal/Household Products 

P Z CUSSONS NIGERIA PLC. 32 29.00 532,096 15,348,226.48 

UNILEVER NIGERIA PLC. 39 45.03 358,792 16,155,961.95 

Personal/Household Products Totals 71 890,888 31,504,188.43 

CONSUMER GOODS Totals 638 11,543,973 281,348,060.96 

FINANCIAL SERVICES 

Banking 

ACCESS BANK PLC. 169 6.18 32,844,240 203,394,173.17 

DIAMOND BANK PLC 57 4.37 7,355,610 32,340,552.71 

ECOBANK TRANSNATIONAL INCORPORATED 60 21.56 1,061,562 22,942,599.13 

FIDELITY BANK PLC 62 1.89 4,481,499 8,448,663.16 

GUARANTY TRUST BANK PLC. 184 29.50 7,626,747 225,063,774.50 

SKYE BANK PLC 119 2.17 15,673,980 33,114,000.59 

STERLING BANK PLC. 30 2.15 2,343,376 4,985,837.37 

UNITED BANK FOR AFRICA PLC 132 5.20 15,794,169 81,668,936.80 

UNION BANK NIG.PLC. 27 10.50 61,430 646,049.79 

UNITY BANK PLC 73 2.23 5,214,620 11,377,433.19 

WEMA BANK PLC. 29 0.99 1,919,713 1,901,326.22 

ZENITH INTERNATIONAL BANK PLC 144 22.22 1,766,721 39,390,810.80 

Banking Totals 1,086 96,143,667 665,274,157.43 

Insurance Carriers, Brokers and Services 

AIICO INSURANCE PLC. 15 1.00 1,098,485 1,098,495.00 

CONTINENTAL REINSURANCE PLC 16 0.99 1,344,894 1,330,725.06 

CORNERSTONE INSURANCE COMPANY PLC. 1 0.50 18,000 9,000.00 

GREAT NIGERIAN INSURANCE PLC 3 0.50 500 250.00 

CONSOLIDATED HALLMARK INSURANCE PLC 1 0.50 1,000 500.00 

INTERNATIONAL ENERGY INSURANCE COMPANY PLC 5 0.53 485,648 250,462.12 

MANSARD INSURANCE PLC 1 3.00 14,000 42,840.00 

MUTUAL BENEFITS ASSURANCE PLC. 2 0.50 21,000 10,500.00 

N.E.M INSURANCE CO (NIG) PLC. 33 0.68 2,418,938 1,650,831.40 

PRESTIGE ASSURANCE CO. PLC. 1 0.50 1,950 975.00 

SOVEREIGN TRUST INSURANCE PLC 1 0.50 400 200.00 

STANDARD ALLIANCE INSURANCE PLC. 1 0.50 90,000 45,000.00 

WAPIC INSURANCE PLC 45 0.54 1,359,770 727,360.48 

Insurance Carriers, Brokers and Services Totals 125 6,854,585 5,167,139.06 

Micro-Finance Banks 

NPF MICROFINANCE BANK PLC 48 1.26 2,862,248 3,653,328.30 

Micro-Finance Banks Totals 48 2,862,248 3,653,328.30 

Other Financial Institutions 

AFRICA PRUDENTIAL REGISTRARS PLC 44 2.99 579,008 1,734,214.97 

CUSTODIAN AND ALLIED PLC 18 4.17 157,000 654,880.00 

FBN HOLDINGS PLC 296 8.99 7,080,630 63,119,430.39 

FCMB GROUP PLC. 91 3.00 11,464,164 34,499,989.82 

ROYAL EXCHANGE PLC. 3 0.50 16,950 8,475.00 

STANBIC IBTC HOLDINGS PLC 21 30.00 135,149 4,095,463.73 

UBA CAPITAL PLC 53 1.49 1,799,362 2,683,120.19 

Other Financial Institutions Totals 526 21,232,263 106,795,574.10 

FINANCIAL SERVICES Totals 1,785 127,092,763 780,890,198.89 

HEALTHCARE 

Healthcare Providers 

UNION DIAGNOSTIC & CLINICAL SERVICES PLC 1 0.50 1,000 500.00 

Healthcare Providers Totals 1 1,000 500.00 

Medical Supplies 

MORISON INDUSTRIES PLC. 1 1.82 1,621 2,804.33 

Medical Supplies Totals 1 1,621 2,804.33 

Pharmaceuticals 

FIDSON HEALTHCARE PLC 26 3.20 366,200 1,159,763.00 

GLAXO SMITHKLINE CONSUMER NIG. PLC. 27 44.20 135,408 5,869,006.90 

MAY & BAKER NIGERIA PLC. 16 1.60 733,413 1,171,023.47 

NEIMETH INTERNATIONAL PHARMACEUTICALS PLC 23 1.10 1,569,426 1,844,173.25 

NIGERIA-GERMAN CHEMICALS PLC. 1 6.32 68 408.68 

PHARMA-DEKO PLC. 3 2.13 1,100 2,423.00 

Pharmaceuticals Totals 96 2,805,615 10,046,798.30 

HEALTHCARE Totals 98 2,808,236 10,050,102.63 

ICT 

Computer Based Systems 

COURTEVILLE BUSINESS SOLUTIONS PLC 2 0.50 15,100 7,550.00 

Computer Based Systems Totals 2 15,100 7,550.00 

IT Services 

COMPUTER WAREHOUSE GROUP PLC 1 4.00 300 1,140.00 

IT Services Totals 1 300 1,140.00 

Processing Systems 

CHAMS PLC 

Processing Systems Totals 1 2,924 1,462.00 

ICT Totals 4 18,324 10,152.00 

INDUSTRIAL GOODS 

Building Materials 

ASHAKA CEM PLC 15 20.47 83,742 1,734,924.00 

BERGER PAINTS PLC 12 10.00 52,350 522,642.28 

CAP PLC 11 43.00 42,541 1,743,561.00 

CEMENT CO. OF NORTH.NIG. PLC 19 10.50 172,690 1,750,476.35 

DANGOTE CEMENT PLC 26 178.50 64,128 11,441,950.23 

DN MEYER PLC. 1 0.83 200 158.00 

FIRST ALUMINIUM NIGERIA PLC 3 0.50 6,099 3,049.50 

IPWA PLC 1 0.50 421 210.50 

PAINTS AND COATINGS MANUFACTURES PLC 2 1.27 11,000 13,420.00 

PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1 3.64 750 2,857.50 

LAFARGE AFRICA PLC. 38 98.20 418,425 41,065,621.19 

Building Materials Totals 129 852,346 58,278,870.55 

Electronic and Electrical Products 

CUTIX PLC. 3 1.58 50,000 79,630.00 

NIGERIAN WIRE AND CABLE PLC. 1 0.50 8 4.00 

Electronic and Electrical Products Totals 4 50,008 79,634.00 

Packaging/Containers 

AVON CROWNCAPS & CONTAINERS 2 1.52 119,349 181,410.48 

BETA GLASS CO PLC. 2 33.00 35 1,212.75 

Packaging/Containers Totals 4 119,384 182,623.23 

Tools and Machinery 

NIGERIAN ROPES PLC 1 7.46 71 503.39 

Tools and Machinery Totals 1 71 503.39 

INDUSTRIAL GOODS Totals 138 1,021,809 58,541,631.17 

NATURAL RESOURCES 

Chemicals 

B.O.C. GASES PLC. 2 5.11 300 1,458.00 

Chemicals Totals 2 300 1,458.00 

Metals 

ALUMINIUM EXTRUSION IND. PLC. 2 10.43 1,000 9,910.00 

Metals Totals 2 1,000 9,910.00 

NATURAL RESOURCES Totals 4 1,300 11,368.00 

OIL AND GAS 

Energy Equipment and Services 

JAPAUL OIL & MARITIME SERVICES PLC 1 0.50 500 250.00 

Energy Equipment and Services Totals 1 500 250.00 

Integrated Oil and Gas Services 

OANDO PLC 234 17.81 5,766,287 102,787,888.50 

Integrated Oil and Gas Services Totals 234 5,766,287 102,787,888.50 

Petroleum and Petroleum Products Distributors 

CONOIL PLC 12 39.92 22,000 885,429.47 

ETERNA PLC. 10 2.70 282,173 762,806.41 

FORTE OIL PLC. 35 173.23 153,736 26,194,334.13 

MOBIL OIL NIG PLC. 15 151.30 17,095 2,596,130.23 

MRS OIL NIGERIA PLC. 5 50.54 4,421 212,296.42 

TOTAL NIGERIA PLC. 26 150.00 74,977 11,262,542.35 

Petroleum and Petroleum Products Distributors Totals 103 554,402 41,913,539.01 

Exploration and Production 

SEPLAT PETROLEUM DEVELOPMENT COMPANY LTD 11 387.00 1,415 564,549.90 

Exploration and Production Totals 11 1,415 564,549.90 

OIL AND GAS Totals 349 6,322,604 145,266,227.41 

SERVICES 

Advertising 

AFROMEDIA PLC 1 0.50 1,000 500.00 

Advertising Totals 1 1,000 500.00 

Automobile/Auto Part Retailers 

R T BRISCOE PLC. 15 0.92 159,667 146,893.64 

Automobile/Auto Part Retailers Totals 15 159,667 146,893.64 

Courier/Freight/Delivery 

RED STAR EXPRESS PLC 10 4.92 347,790 1,706,561.00 

TRANS-NATIONWIDE EXPRESS PLC. 22 1.06 950,864 1,007,917.84 

Courier/Freight/Delivery Totals 32 1,298,654 2,714,478.84 

Employment Solutions 

C & I LEASING PLC. 59 0.69 8,258,977 5,608,724.04 

Employment Solutions Totals 59 8,258,977 5,608,724.04 

Hospitality 

TANTALIZERS PLC 1 0.50 500 250.00 

Hospitality Totals 1 500 250.00 

Hotels/Lodging 

IKEJA HOTEL PLC 14 3.79 424,200 1,481,888.92 

TRANSCORP HOTELS PLC 2 9.63 10,050 91,957.50 

Hotels/Lodging Totals 16 434,250 1,573,846.42 

Media/Entertainment 

DAAR COMMUNICATIONS PLC 1 0.50 30,000 15,000.00 

Media/Entertainment Totals 1 30,000 15,000.00 

Printing/Publishing 

ACADEMY PRESS PLC. 3 1.00 56,500 56,380.00 

LEARN AFRICA PLC 9 1.15 85,523 98,366.24 

UNIVERSITY PRESS PLC. 24 6.03 611,359 3,538,323.57 

Printing/Publishing Totals 36 753,382 3,693,069.81 

Road Transportation 

ASSOCIATED BUS COMPANY PLC 4 0.56 582,643 324,737.22 

Road Transportation Totals 4 582,643 324,737.22 

Transport-Related Services 

AIRLINE SERVICES AND LOGISTICS PLC 6 2.11 70,653 156,143.13 

NIGERIAN AVIATION HANDLING COMPANY PLC 57 6.80 1,667,358 11,183,713.30 

Transport-Related Services Totals 63 1,738,011 11,339,856.43 

SERVICES Totals 228 13,257,084 25,417,356.40 

EQTY Board Totals 3,515 185,322,158 1,395,003,420.24 

CONSUMER GOODS 

Food Products 

MCNICHOLS PLC 2 1.50 550 863.50 

Food Products Totals 2 550 863.50 

CONSUMER GOODS Totals 2 550 863.50 

ASeM Board Totals 2 550 863.50 

Equity Activity Totals 3,517 185,322,708 1,395,004,283.74


LIVE @ THE STOCK EXCHANGE 

BUSINESS DAY 

45 

FTSE, Stanbic IBTC develop 

Nigeria IPF benchmark 

...New benchmark comprises of NSE listed equities 

HEANYI NWACHUKWU 

FT SE Group 

(FTSE), the 

global index provider, 

has developed 

the FTSE 

Nigeria Investable Pension 

Fund (IPF) Benchmark. 

The new index is the first 

of its kind in the region, encapsulating 

Nigerian listed 

companies while adhering 

to National Pension 

Commission (PenCom) 

regulation on investment, 

safeguarding good corporate 

governance for users. 

It has been created as 

a replicable index as well 

as a performance benchmark, 

in close collaboration 

with Stanbic IBTC 

Pension Managers Limited, 

Nigeria’s largest pension 

fund. 

The index methodology 

has been designed to adhere 

to PenCom’s Regulation 

on Investment of Pension 

Fund Assets, ensuring 

that a strong emphasis is 

placed on governance and 

best practice. 

Benchmark constituents 

are comprised of FTSE 

Frontier Index Series companies 

listed on the Nigerian 

Stock Exchange, which 

are then screened for taxable 

profits, dividend, free 

float, sector and individual 

stock weighting. 

Jonathan Cooper, managing 

director, research & 

analytics, FTSE, said: “As 

FTSE’s global presence 

continues to expand, we 

are pleased to launch this 

new innovative benchmark 

featuring companies from 

Africa’s largest economy. 

“Corporate governance 

plays a vital role in all equity 

markets and is integral 

to investor confidence, 

leading to significant demand 

for benchmarks of 

this nature. This is reflected 

in Stanbic IBTC Pension 

Managers’ support during 

its development and 

immediate adoption on 

completion. We look forward 

to developing more 

indices for this exciting 

market.” 

Demola Sogunle, chief 

executive officer, Stanbic 

IBTC Pension Managers 

Ltd, said: “Stanbic IBTC is 

committed to the growth 

and development of the 

financial market. This commitment 

is part of the reason 

why we are very excited 

to be part of this welcome 

development. 

“The IPF is necessary 

for measurement of the 

performance of the equity 

portion of Pension Funds. 

It fulfils that need to have 

an index that is investable, 

transparent and independent. 

We believe that it will 

encourage more participation 

in the market as inves- 

tors would be able to track 

companies that pension 

funds typically invest in.” 

Chinelo Anohu Amazu, 

director general, PenCom, 

said: “The Commission is 

delighted with this commendable 

initiative by 

FTSE, as it would provide a 

good benchmark for Nigerian 

Pension Fund Administrators 

(PFAs) and PenCom, 

to better assess and monitor 

the performance of the equities 

portfolio of individual 

pension funds.” 

FTSE had announced 

the launch of the FTSE 

Frontier Markets Index Series 

in September 2014. 

The benchmarks covers 

26 countries defined as 

Frontier by FTSE’s Country 

Classification process, and 

captures the performance 

of large, mid and small cap 

equity securities from eligible 

markets. There are 39 

Nigerian companies currently 

included in the index. 

Champion Breweries returns 

to profitability 

Champion Breweries 

plc has recorded 

substantial 

improvement 

in its results with a record 

leap in turnover from 

N2.2bn recorded in 2013 to 

N3.3bn in 2014. 

The Company which repositioned 

to attract credit, 

also returned to profitability 

and generated a profit 

of N25.5m as against a loss 

of N543.9m declared for 

the previous year. 

Senas Ukpanah, chairman, 

Champion Breweries 

plc, who stated this in Lagos 

at the company’s 39th 

Annual General Meeting 

put the company’s loss 

before tax at N1.07bn from 

N1.73bn recorded the previous 

year. 

This, according to him, 

was due to high impact of 

finance cost of N1.08bn as 

against the previous figure 

of N1.18bn. 

Ukpanah lauded shareholders 

for supporting 

the last recapitalisation 

exercise of the Company, 

saying the N13.7bn rights 

issue was successful as it 

was over-subscribed by 

shareholders. 

While lamenting the 

challenging economic environment 

under which 

the company operates, he 

said “despite the overall 

stagnating market, Champion 

Breweries was able to 

achieve operational profits 

as well as complete pay-off 

of its long-standing debts 

and reduced the interest 

burden carried over the 

years.” 

Ukpanah, who also expressed 

optimism on bright 

prospects for the Company 

said “our ship has set sail 

to navigate into greater 

heights and positive prospects. 

Strategies are being 

put in place to grow our 

dear brand- Champion Lager 

Beer- and significantly 

expand our markets within 

the South-South region in 

the incoming years.” 

The shareholders applauded 

the Board’s effort 

and the turnaround plan 

being implemented for the 

Company while appealing 

for more efforts by the 

Company Management 

to make Champion Lager 

Beer more competitive.



CITN 

17th Annual Tax Conference 

Day 3 of the 17th annual tax conference 

Fred Omaka (l), council member, CITN, with Adefisayo Awogbade, registrar/chief 

executive, CITN 

Daniel Bako (l), with Adedayo Adesina, honorary treasurer, CITN 

Kamoru Agigun, (l), past president, with Kunle Quadri, past president, 

both of CITN 

Taiwo Oyedele, partner, tax & regulatory services, PwC, presenting hos 

paper at the conference 

Sunday Jegede, (l), past president, with Cyril Ede, deputy vice president, 

Bothe of CITN 

Mark Anthony Dike, (l), president CITN, with James Kayode Naiyeju, former 

accountant general of federation 

L-R: Victor Onyenkpa, partner & head, tax regulatory and people services, 

KPMG: James Kayode Naiyeju, former accountant general of federation, 

and Taiwo Oyedele, partner, tax & regulatory services, PwC 

Victor Onyenkpa, partner & head, tax regulatory and people services, KPMG, 

presenting his paper at theconference 

Cross section of the participant at the conference 

Ade Ipaye (l), attorney general of Lagos State, with Mike Kofi Afflu, president, 

Chartered Institue of Taxation Ghana 

Elemanya Ebilah, chairman, annual tax conference committee; Godwin Oyedokun, 

head research and technical department, CITN, and Monday Akonafua, 

P.A to the CITN president 

Akin Akinsehinwa (l), chairman, Ondo State Board Internal Revenue, with Tunde 

Fowler, executive chairman, Lagos State Internal Revenue Service 

Pics by Olawale Amoo


47

48 

BUSINESS DAY 

REAL SECTOR WATCH 


“The big secret in life is that there 

is no big secret. Whatever your 

goal, you can get there if you’re 

willing to work.” 

-Oprah Winfrey 

“You see, in life, lots of people know 

what to do, but few people actually 

do what they know. Knowing is not 

enough! You must take action.” 

-Anthony Robbins 

Exports are quite erratic and their 

pattern is often different from GDP 

cycles, also because they heavily 

depend on other countries’ events 

-Valentino Piana 

Local footwear struggling 

to compete with imports 

ODINAKA ANUDU 

Samuel Achara is a smallscale 

footwear maker in 

Aba, the economic capital 

of Abia State in South Eastern 

Nigeria. 

His make-shift shop at York 

Street mini market in Abia South 

Local Government Area costs him 

less than N3,000 ($15) every month. 

But he still coughs out more than 

N8,000 ($40) within the month to 

pay a myriad of levies and taxes that 

come with different nomenclatures. 

As in the usual Nigerian manner, 

the revenue collecting agents 

are fierce-looking young men aged 

between 22 and 40, claiming to 

represent the state or the local government 

area. Refusal to ‘cooperate’ 

with them is as dangerous as rejecting 

the modern-day armed robber’s 

demand to relinquish your property 

or money. 

By a dint of hard work, Achara’s 

Vision Shoes Production, a firm with 

three staff members who are mainly 

apprentices, can ‘finish’ at least four 

pairs of shoes each day. The firm 

opens at exactly 7:00am each day 

and closes at 6:30pm. 

But the shoemaker struggles 

to get its raw materials from the 

Northern part of Nigeria, where 

traders of animal skins prefer to sell 

to representatives of Italian, Dutch 

and Chinese firms that pay twice or 

three times higher. 

Achara’s firm now resorts to 

sourcing its animal skins from Cameroon, 

Chad and China. Achara’s 

adhesives, which serve as glue for 

leather, are often imported from 

China as no known manufacturer 

produces it locally. 

But he is still cautious of Chinese 

adhesives, which, though are 

cheaper, cannot compare with those 

of Italians and the Dutch that are 

superior, not easy to come by and are 

often inaccessible to foreign firms. 

Achara is also attracted to an offer 

from one of the new generation 

banks with several branches in Aba. 

The bank wants to offer him a loan 

of N1 million ($5,000) to expand, but 

is demanding an interest rate of 18 

percent payable in 12 months. 

However, he decides to settle for 

a relative who lends him a loan of 

N500,000 ($2,500) at an interest rate 

of 13 percent, which is equivalent to 

Central Bank of Nigeria’s Monetary 

Policy Rate, the benchmark interest 

rate for financial institutions in 

Nigeria. 

The deplorable state of Aba roads 

makes access to the market difficult. 

To Achara, Aba roads are the most 

deplorable in the South East, making 

accessibility to customers difficult, 

but armed robbers’ onslaught easy. 

Due to inconsistent and intermittent 

electricity supply in Aba, 

Achara’s firm has to acquire three 

generators, all of which run for more 

than seven hours each day. 

“In fact, my ‘landing’ cost of production 

for a pair of shoes is about 

N2,200 ($11), but an imported pair 

of shoes is sold for N2,000 ($10),” 

said Achara, in a chat. 

“We are in business to make 

profit. I will have to pay for my shop 

as well as taxes and levies. I will pay 

my apprentices some stipends and 

take care of my family, because this 

is my source of livelihood,” he said. 

“But tell me, how will I set my 

market price?” he asked rhetorically, 

almost mechanically. 

This paints the gory picture of 

the state of local footwear makers in 

the country, who play in an industry 

worth $680 million, creating 700,000 

direct and indirect jobs, according to 

Olusegun Aganga, minister of industry, 

trade and investment. 

In Abia State alone, there are 

more than 30,000 footwear makers, 

mainly small-scale. Added with 

other leather wear players such as 

bag, belt and trunk box manufacturers, 

the number increases to 80,000, 

according to Nnabugwu Osondu, 

secretary, Abia State Shoe, Bag, 

Belt and Trunk Box Association, 

who spoke with BusinessDay in a 

telephone chat. 

In Aba, Lagos, Kaduna, Kano, 

Onitsha, and other parts of the 

country where footwear is made, 

the complaints have been similar: 

poor access to finance, raw material 

challenge, poor infrastructure 

and lack of adequate/sophisticated 

machinery. According to Osondu, 

“we sincerely need finance to drive 

this industry. 

“We often approach banks for 

finance, but they give us difficult 

conditions that we cannot meet. It is 

difficult because many of us are in the 

small- and medium-scale category.” 

Aba shoemakers have now resorted 

to the use of the synthetic leather, 

often called the plastic leather, imported 

from China, because they 

find the price of animal skins from 

Northern Nigeria prohibitive, he said. 

Hamman Haruna, managing 

director of Hamman Shoes, Kaduna, 

lamented that the constant use of 

diesel had kept on increasing his 

cost of production and continued 

to make his products unable to 

compete with imported ones. 

Coupled with high cost of production 

is poor perception of madein-Nigeria 

footwear by local consumers. 

Currently, local footwear 

makers put foreign labels on their 

products because they must sell 

their products, which if seen as 

locally-made, may not be taken too 

seriously by consumers. 

“If we cannot be proud of our 

own products, then we are encouraging 

our artisans and local manufacturers 

to use foreign labels on 

their products,” said Thank-God Injima, 

managing director, Nwadiche 

Shoes, Aba. 

“I was surprised to hear a senator 

in Nigeria confess in Abuja, in one 

of the trade exhibitions I attended 

recently, that he booked for some 

products to be imported from China. 

But a friend of his informed him 

that he could source those items in 

Aba, which he succeeded in getting. 

However, instead of being proud to 

say that the items were produced 

in Aba, he claimed that he sourced 

them from China, thereby depriving 

Aba and the country of the credit,” 

Injima narrated. 

Rasheed Olaoluwa, CEO, Bank of 

Industry, Nigeria’s frontline development 

bank, in a chat during a factory 

inspection in Ogun State, said: 

“We need to get over this inferiority 

complex among our citizens. We 

should be proud and see a product 

made in the country as our own.” 

Olaoluwa further berated Nigerian 

businessmen who advise local 

manufacturers to put foreign labels 

on their products, saying the practice 

was inimical to the country’s 

economic progress. 

Even though Frank S.U Jacobs, 

president, Manufacturers Association 

of Nigeria, sees this type of 

branding as a sharp practice and 

misinformation, the practice seems 

to have persisted. 

But one thing that stands out 

among shoemakers, especially those 

in Aba, is that their products are not 

as inferior as it is painted by some local 

consumers. This is evidenced in 

the fact that locally made shoes from 

the area are already being shipped 

to West and East African markets. 

But one fact that should not be 

hidden is that locally-made products 

are not as competitive in the 

international market as they should 

be owing to comparatively lower 

quality. 

Ayotola Oluwaseun, CEO, Olariwaju 

Lagos-leather Products Designers 

and Crafters, said more 

emphasis should be placed on improving 

the quality and consistency 

of locally-made footwear. 

“I’m impressed with their products, 

because it shows some level of 

craftsmanship, but emphasis should 

be placed on improving the quality 

and consistency of their products, 

which is a key part,” Oluwaseun 

said, at a two-day market meeting, 

organised by the Leather Product 

Manufacturers Association of Abia 

State (LEPMAAS) and facilitated by 

Growth and Employment in States 

GEMS 1, held recently. 

According to him, a couple of the 

artisans he spoke with produce very 

limited quantities of shoes, because 

they run their production manually. 

He advocated for procurement 

of better machines/equipment to 

make them consistent at every point. 

“Let us make products that 

scream Nigeria, so that when we take 

it to the outside world, they would 

see that the product is different,” he 

said. But the governments at federal, 

state and local levels have failed to 

create the right environment for this 

sector to thrive. 

Taxes are still multiple. The outgoing 

government, which promised 

to initiate plans to increase revenue 

accruable from the industry to N20 

billion annually and double its $680 

million worth, did not live to its 

words. Power supply situation has 

worsened with the new electricity 

managers who keep complaining 

of gas shortages and lack of funds. 

Experts say Nigeria’s economic diversification 

mantra can never be realised 

as long as a sector like leather/ 

footwear is still under-exploited.


49



POLITICS 

Policies • Issues • Debates 

‘Prompt payment of workers’ salaries my major satisfaction 

Elected executive chairmen in the 18 local government areas of Edo State clocked two years 

in office recently. In this interview, Jimoh Ijegbai, executive chairman of Owan East Local 

Government Area, spoke with IDRIS UMAR MOMOH on what makes his administration thick, 

particularly prompt payment of salaries. Excerpts: 

It is two years of your 

administration as the 

elected executive chairman 

of Owan East Local 

Government Area. 

How far have you been able 

to carry on the governance of 

the council? 

We have done quite a lot in 

the area of health, school, road, 

water and electricity. Since we 

came in we have embarked on 

massive construction of schools 

across the 11 wards in the local 

government. In the past two 

years, we have constructed a 

total of 18 schools equipped with 

furniture and commissioned. 

They include 14 blocks of three 

classrooms; two blocks of 6 

classrooms were reconstructed 

and constructed among others. 

In the past two years the 

council has distributed over 

200,000 free exercise books to 

pupils in the public primary 

schools across the council free 

of charge. Each pupil was ensured 

that they get at least six 

free exercise books. The council 

has also distributed over 3,000 

benches/desks to public primary 

schools. These were done so 

as to enhance hitch-free learning 

ability of our pupils and reduce 

financial burden on the part of 

their parents in the provision of 

learning materials. 

The council has done wonderfully 

well in the health sector. 

We participated in all programmes 

that have to do with 

immunization, primary healthcare, 

completed and upgraded 

facilities in our referral centre 

in Afuze. We constructed a new 

health centre at Emai, Afuze. 

Across the 11 wards in the local 

government area all our Primary 

Health Care centres are doing 

excellently well. 

In the area of electricity we 

have extended electricity to 

some communities that were 

before now not enjoying the 

facilities. We have bought and 

installed transformers in some 

communities like Ake, Uanhumi, 

Ihievbe, Afuze among others. 

The council bought and installed 

500KVA transformer in Ohanmi, 

500KVA in Ihievbe, extension 

of electricity supply to Igboro 

community, purchase of 500KVA 

transformer for Ake, construction 

and installation of 500KVA 

at Uanhumi, Erha, Igbirra camp 

in Uokha, Afuze among others. 

The transformers distribution 

is across the 11 wards in the 

council. 

In transportation sector, 

we bought eight new buses to 

Ijegbai 

boost our fleets. The council has 

opened route to Abuja. Plans are 

also underway to commence 

operation in Lagos route. 

Four water projects have so 

far been executed in the locality 

and we are in the process 

of embarking on constructing 

additional eight water projects. 

The purpose was to ensure meeting 

up the implementation of 

the Millennium Development 

Goals (MDGs) which unfortunately 

I think Nigeria is going 

to miss. Water and sanitation 

is one of the key components 

in meeting the MDGs goals and 

as such people should have access 

to safe drinking water. As 

one of the requirements, we 

feel that as we go ahead in the 

21st Century people should not 

be going to the stream to fetch 

water. They should have access 

to safe drinking water. This is 

our motivation and it is geared 

towards meeting the MDGs. We 

have water project in Uanhumi, 

Ago-Gbodo, Oroe and Igbirra 

camp in Warrake. 

Also, the council participated 

in a lot of state-sponsored sporting 

competitions with a view to 

taking our youths away from the 

streets. We hosted the first and 

second editions of the late Michael 

Imoudu memorial sports 

competition here in Afuze. 

In overall we have done extremely 

well in all sectors of 

governance in the local government. 

But our major challenge 

is the downturn in the economy 

which is telling very much on 

Nigerians as we speak. But to 

the glory of God even though 

the Federal Government has not 

been able to pay our April salary, 

the council has paid its workforce 

up to date. We however, 

hoped sincerely that there will be 

improvement in the finances of 

the council to enable us perform 

better than we have been doing. 

We hoped that with the coming 

of the new government we are 

going to see improvement especially 

in the area of the collection 

of revenue at the federal level 

which has not been transparent 

before now. 

We hope to see improvement 

in ensuring that whatever is 

due to the federation account is 

achieved and all the federating 

units that are the three tiers of 

governments get what is actually 

due to them. That is what we 

are earnestly praying for come 

May 29. 

The period we used to hear 

of 400,000 barrels of crude oil 

stolen on daily basis we pray that 

it will go away with this out-going 

administration, and with the 

coming of the APC presidentelect, 

General Muhammadu 

Buhari administration we are 

going to see a new thing totally 

different from what we are currently 

experiencing in the outgoing 

government because as 

it is today, no man can actually 

plan with the budget because 

it is subject of vagaries that are 

beyond your control. 

What has been the miracle 

behind the council meeting 

its workforce obligations, 

especially in the payment of 

salaries and other financial 

commitments in spite of the 

aforementioned challenges? 

Councils are different and 

they are being governed by 

different managers. The teams 

we have in Owan East Local 

Government Area are wonderful 

one. We have that foresight 

of setting aside certain money 

every month for the payment of 

salaries but with the dwindling 

allocation we have gone into 

our savings and it is eventually 

now that we are exhausting it. 

We used to set aside one month 

salary so that at any giving time 

even before federal allocation 

comes we will pay our staff. Consistently, 

since last year, we have 

been having shortfall of funds 

from the federal allocation and 

that has made us to go into the 

savings. But thank God that as at 

today, we have paid our salary up 

to the month of April. 

We are embarking on serious 

revenue drive within the ambit 

of the law. We know the areas 

that we can harness our IGR and 

those we cannot go into. We have 

a filling station where we sell 

petroleum products, we are into 

transportation and any other 

collectible revenue that is due to 

us by law we are doing it to ensure 

that whatever shortfall we 

are able to augment so that we 

don’t wake up one day and not 

be able to pay our staff because I 

believe that the workers deserve 

their wages. Having worked for 

30 days and you asked workers to 

wait for first to fifth months the 

motivation will be very low and 

calling on them to come to work 

will be a bit difficult and not to 

talk that they have responsibility 

to even offer to their respective 

families. 

So, we will continue to try 

within our means to ensure that 

we meet up with our obligations 

and we are very hopeful that 

by the time the president-elect 

assumes full leadership of the 

country, the revenue accruing 

to the federation account will 

substantially increase and I 

think that was the fulcrum of the 

APC governors’ meeting with 

the president-elect recently in 

Abuja, because a lot of states and 

local governments are defaulting 

in the payment of their salary 

obligation to their staff which 

to me is the least thing that anybody 

will think of at all. If you are 

holding office you should be able 

to pay your workers at the end of 

the month. 

Is there any plan by the 

council authorities to set up 

any other economic venture 

in addition to the filling station 

and transport firm to 

boost its internally generated 

revenue before the end of 

your tenure? 

If I have my way, we will go 

into serious mechanized agriculture. 

Owan East is noted for 

its good fertile soil and I think 

that if we have the resources to 

be able to buy tractors and other 

agricultural equipment that will 

enable us to go into mechanized 

farming we will not hesitate to do 

it. I believe that the country will 

go back to agriculture if eventually 

that will be the only way out 

of the situation we have found 

ourselves at the moment. 

Would you recommend 

the council’s IGR model to 

the leadership of other local 

governments or state governments 

across the country? 

It depends on whatever the 

administrator in the various 

councils or state governments 

has as a policy. They have to 

choose whether to adopt our 

model or not. It is a voluntary 

decision. They have to choose 

which economic model to follow 

or not. Every government 

has its own tactics and policy on 

whatever it wants to do. I believe 

that every government will have 

to look at where its comparative 

advantage is higher because if 

you go into transport system 

and you are in a place where the 

population is not that very much 

it will be a waste. It cannot be a 

wholesale recommendation to 

everybody that you must go into 

this line of business. 

How has the council implemented 

its budgetary allocation 

to develop and boost 

agricultural sector annually? 

We have been trying our best.


Policies • Issues • Debates 

BUSINESS DAY 

51 

POLITICS 

Remembering Jonathan’s good deeds 

CHUKWUEMEKA EMERE 

As you take a bow on 

May 29, President 

Goodluck Jonathan, 

you will go down in 

history as a leader 

who insisted to the last minute 

that your ambition did not 

worth the blood of any Nigerian. 

Before the general election, 

not many people gave you the 

benefit of doubt to deliver a 

successful poll. Many more 

became soothsayers overnight 

to the point of singing the requiem 

of the Nigeria state. They 

said Nigeria’s breakup was imminent. 

They quoted and tried 

to support their fears with what 

they claimed had been said by 

some foreigners many years 

ago. For them, 2015 general 

election was a time bomb. 

Despite a deluge of criticisms, 

you held tenaciously to 

the mantle of leadership in the 

face of challenging socio-political, 

religious and economic 

situation of the country. They 

dressed you in many garbs. 

They called you ‘Mr. Go Slow’; 

they said you were bereft of 

ideas. Not many people acknowledged 

the challenge of 

office and the burden upon 

your shoulders. And no one 

was ready to lend a helping 

hand. It was Jonathan’s problem, 

they say. 

You ran a re-election campaign 

with the initial full support 

of leadership of your party; 

in fact, the national headquarters 

of the PDP ensured that no 

other person contested the primaries 

with him; they moved 

from one part of the country 

to another with you, during 

the campaigns, but today, 

Jonathan is alone. You have 

been deserted by the National 

Working Committee (NWC) 

members who now claim they 

were not being carried along 

and that their counsel was not 

sought during the campaign, 

REMI FEYISIP0. 

Governor Rauf Aregbesola 

of Osun State has 

said the challenges the 

state is facing presently 

is temporary and that his 

administration would fulfill all 

its promises to the people. 

Aregbesola stated that his administration 

has fulfilled every 

promise made to the people, saying 

every other promise made 

that has not yet been fulfilled, 

would soon be fulfilled. 

“We will not disappoint the 

people who trusted us and keep 

giving us the mandate to govern. 

It is not in our DNA to disap- 

Jonathan 

The Bayelsa man is now the 

sacrificial lamb. I admire the 

way you have reduced all that 

to something unserious- smiling 

and maintaining his pleasant 

disposition. 

In defeat, you have turned 

out to be a role model and have 

been commended globally. By 

your prompt intervention and 

deployment of sagacity, you 

prevented bloodshed and anarchy 

that could have probably 

headed the country into disintegration. 

You also restored 

the dignity of the Nigerian 

state that appeared to have 

been eroded in the eyes of the 

outside world. 

Not only that the 2015 general 

elections have been acclaimed 

as one of the best in 

point, whatever challenges we 

are facing can only be temporary; 

our commitment and 

passion to serve our people is 

undiminished. 

“We remain resolute to lay 

a solid foundation and preside 

over the most peaceful and the 

most prosperous era in the annals 

of this state. We shall fulfill 

our mandate because our best is 

yet to come,” he said. 

Speaking during the RLG 

product Discovery Day held at 

the RLG Adulawo Technology 

City, Ilesa-Akure Expressway, 

he said the People’s Democratic 

Party (PDP) is the harbinger of 

Nigeria’s problem. 

RLG plant, a public-private 

partnership arrangement between 

RLG Ghana and Osun is 

the biggest in Africa and the first 

of its kind in Nigeria. 

Aregbesola stressed that given 

the potential of the electronic 

market in Nigeria, RLG is a necessity 

which when in full operation, 

will be able to assemble all 

kinds of electronic gadgets from 

mobile phones, LCD TV, desktop 

computers and any electronic 

device imaginable. 

He added that RLG has 

recorded a significant breakthrough 

with GSM service providers 

partnering with it. 

According to him, “RLG has 

received an order for 50,000 

phones each from Airtel Nigeria 

recent history by stakeholders, 

your subsequent input is indeed 

remarkable and rewarding. 

You doused tension where 

necessary in the event of unfriendly 

attitude by so called 

enemies of progress. You spoke 

out loudly assuring that all is 

well. At the ward level, you and 

your wife, Patience, were patient 

enough to cast your votes 

in the midst of underperforming 

electronic capturing machine; 

you kept your cool and 

calm too. You spoke out, urging 

the electorates to take it kindly 

with the smart card readers, 

the INEC staff generally. Others 

would have reacted differently. 

Where allegations of complicity 

were rife in some collation centres, 

you continued to applaud 

the performance of INEC. 

Your calm disposition was 

mistaken for weakness, all for 

the sake of peace of the nation. 

You are the most abused 

President of all time. You are 

a kitchen, kindergarten, ‘moi 

moi’ President. Your Presidency 

is least honoured, a disaster 

for the polity. Your detractors 

are now beating their chest 

in remorse of conscience, accusing 

the devil for their misgivings. 

You bore all these insults 

and aspersions stoically, 

the Socrates of our time, the 

Ghandhi and Mandela of our 

age. You are now a rising star 

to behold, a living saint, saint 

Goodluck. You are now highly 

priced jewelry for doing your 

job well for our fatherland,” the 

retired civil servant said. 

“When the zero moment 

arrived, you were again superlative. 

In the elections proper, 

your men in the field told the 

level of complicity in the electoral 

process by other stakeholders. 

PDP youth wing was 

prepared to go on the prowl 

awaiting your next line of action 

to reject the outcome of 

the elections based on the 

alleged irregularities, even 

prepared to go the extra mile. 

But where electoral process is 

compromised, you seemed to 

have given blanket cover. You 

ignored all the calls from the 

field about massive upsurge of 

underage voters in their tens of 

thousands. Where outrageous 

and unimaginable figures were 

posted in favour of opponents, 

without record of any void 

votes, you have not made any 

calls for further investigations. 

You allowed the sleeping dog 

lie, all for the peace of the polity. 

When your political opponents 

nursed the fear that you 

would not accept defeat, is this 

not predicated on the allegations 

of electoral malpractices? 

But you offered an olive branch 

instead never giving a bite, all 

for posterity. We may ask where 

lies your sins? You are now a 

virtuous man; you have now 

become a household name for 

good reasons. Your untimely 

call to General Muhammadu 

Buhari, winner of the presidential 

election calmed frenzied 

nerves. 

The expected inevitable, 

war, confusion and eventual 

disintegration were not to be. 

Everyone buried the hatchet. 

You have not even proceeded 

to the tribunals or the courts 

to delay the process. The certificate 

saga which bedeviled 

the APC President elect is now 

swept under the carpet. Everyone 

is speaking about the high 

expectations of the incoming 

administration. 

You have laid a solid foundation 

for future leaders to 

emulate to throw in the towel 

when ovation is loudest. Nevertheless, 

President elect General 

Muhammadu Buhari: you have 

enormous task ahead of you: 

the responsibility of unifying 

all the segments of Nigeria and 

indeed to run an all inclusive 

government, the best option. 

As President elect, you must 

endeavour to imbibe the culture 

of humility which is the 

hallmark of credible leadership 

quality exemplified by Mr. 

President’s show of magnanimity 

in defeat in the Presidential 

polls. 

We proudly applaud Mr. 

President in this regard for his 

consistency. Moreover, Mr. 

President Goodluck Jonathan, 

at the very beginning of this 

process, assured Nigerians that 

“his ambition does not worth 

the spilling of blood of any 

citizen of Nigeria” and he kept 

his word. This singular action 

of Mr. President would surely 

earn him a place in the world’s 

Guinness book of Records. 

Emere is a retired civil servant 

We’ll deliver all our promises to the people - Aregbesola 

and Globacom,” stressing that 

the company has provided direct 

employment to 150 workers. 

Aregbesola pointed out that 

the next phase of its operation 

will provide employment to 

1,500 salespersons who will man 

the kiosks and other sales outposts 

for RLG products as it enters 

the mobile phone markets. 

He flayed critics and naysayers 

who last year alleged that 

RLG was for the purpose of 

the election that was to come 

up later in the year, thanking 

God that such critics have been 

proven wrong. 

According to him, “they predicted 

that OYES would fail, 

they predicted that O’MEALS 

would fail, they even predicted 

that O’REAP would fail. Then of 

course, they predicted that we 

would not win re-election. 

“They also predicted that the 

alliance that produced the All 

Progressives Congress (APC) 

would collapse in six months. 

Then, they predicted that the 

APC Presidential Candidate 

would not win the election. 

“We can now laugh at their 

puerile and malicious predictions 

that were doomed to fail 

ab initio. When their predictions 

failed, their next move now is to 

cowardly attack our families,” 

the governor told the gathering.



Harvard 

Business 

Review 

MondayMorning 

In association with 

ANDRIS A. ZOLTNERS, 

P.K. SINHA AND SALLY E. 

LORIMER 

Technology trends that matter to sales teams 

The convergence 

of mobile, analytics, 

context-rich 

systems and the 

cloud is transforming 

the sales process 

and enabling buyers and 

salespeople to engage with 

each other more effectively. 

Recently, Gartner, an information 

technology research 

and advisory company, listed 

10 top strategic technology 

trends. Some have significant 

implications for sales forces, 

including: 

1. COMPUTING EVERY- 

WHERE: Through the proliferation 

of mobile devices, 

buyers and salespeople can 

reach each other anywhere, 

anytime. 

2. ADVANCED, PERVA- 

SIVE AND INVISIBLE ANA- 

LYTICS: By layering analytics 

seamlessly on top of linked 

data on customers, sales activities 

and salespeople, companies 

can deliver the right 

assistance to salespeople and 

customers at the right time. 

3. CONTEXT-RICH SYS- 

TEMS :Data and analytical 

insights can be tailored for 

specific situations faced by 

customers and company 

personnel. The customization 

aligns perfectly with how 

salespeople think and work. 

4. CLOUD COMPUTING 

AND SOFTWARE-DEFINED 

INFRASTRUCTURE: These 

enable fast deployment and 

scaling of systems to keep up 

with the changing needs of 

the business, the customers 

and the sales force. 

Consider these examples: 

A telecom company developed 

a filtering model 

that used advanced analytics 

to recommend to account 

salespeople which products 

and services to offer to each 

customer based not only on 

past purchases within that 

account but also on purchases 

in other accounts with 

a similar profile (i.e., “data 

doubles”). The model also 

forecasted the size of the opportunity 

and the likelihood 

of purchase at each account. 

The data and technology enabled 

the sales force to better 

match products with customers, 

driving stronger uptake 

of new product lines and improving 

the opportunities for 

cross-selling and up-selling. 

A company in the financial 

services industry examined 

millions of phone 

records and listened to dozens 

of calls to identify how 

to improve the sales process. 

Using advanced analytics, the 

company produced simple 

but groundbreaking insights. 

First, by focusing on just seven 

of the 14 target industries, 

salespeople could increase 

profits by 16%. Second, by 

shifting calls to the right time 

of day, salespeople could 

triple the probability of a sale 

and increase profits by 20%. 

Third, by adopting the sales 

techniques used by top performers, 

salespeople could 

enhance their results. 

As new trends emerge, 

sales forces must constantly 

and creatively adopt and 

adapt new technologies to 

improve sales processes and 

better serve customers. 

(Andris A. Zoltners is a 

professor emeritus of marketing 

at Northwestern University’s 

Kellogg School of 

Management. He and P.K. 

Sinha are co-founders of ZS 

Associates. Together with 

Sally Lorimer, they are co-authors 

of “Building a Winning 

Sales Management Team: 

The Force Behind the Sales 

Force.”) 

(C) (2015) Harvard Business Review. Distributed by New York Times Syndicate


Harvard 

Business 

Review 

MondayMorning 

BUSINESS DAY 

In association with 

53 

What tesla and apple both know 

about entering new markets 

RON ADNER 

Electric carmaker 

Tesla recently 

made headlines 

w h e n i t 

announced 

plans to enter the market 

for battery-based, powerbackup 

systems for homes, 

businesses and utilities. 

With its elegantly designed, 

cleverly branded Powerwall, 

Tesla has the potential to 

deploy a true ecosystem 

strategy to jump-start what 

has so far been a productbased 

market. 

The battery-based 

business has been a decadelong 

disappointment for 

both incumbents and startups. 

But Tesla could succeed 

- and transform the market. 

Tesla could leverage 

what I call “ecosystem 

carryover”: using positions 

in existing market spaces 

to create a new marketspace 

position. Ecosystem 

carryover was Apple’s 

secret sauce in entering the 

then-established market 

ALEXANDRA SAMUEL 

Yes, you receive 

more 

emails than 

you can reply 

to or even 

read. Yes, the same goes 

blog posts, articles and 

newsletters. And yes, 

the number of your 

LinkedIn connections, 

Twitter contacts and 

Facebook friends feels 

overwhelming. 

But digital overload 

is also a professional 

asset that challenges us 

to make constant, systematic 

choices about 

where we’ll invest our 

time and attention. Thus 

we develop habits that 

make it easier to manage 

all the distractions 

and requests - not just 

the digital ones - that 

can blow us off course. 

Digital overload helps 

you hone your ability to 

focus. As author Daniel 

Goleman has noted, the 

for smartphones - and 

changing the game. It wasn’t 

the iPhone’s uniqueness 

that persuaded mobile 

operators to break from 

previous industry norms; 

rather, it was the assured 

support of iPod buyers 

happy to upgrade to this 

next-generation device. 

Ecosystem carryover 

is the key to successful 

market convergence. This 

mechanism links initially 

separate markets into 

what looks like - after the 

fact - a single coherent 

opportunity. It’s easy to 

forget that MP3 players and 

mobile phones were once 

regarded as separate market 

opportunities. So, too, were 

electric cars and homeenergy 

management. 

For Tesla, the ability 

to pursue an ecosystem 

carryover strategy is twofold: 

The company’s 

position with Tesla car 

owners - a customer base 

characterized by loyalty and 

high disposable income.The 

power of Elon Musk, Tesla’s 

Turn digital overload to your advantage 

ability to effectively focus 

and direct attention 

is a core competency of 

effective leaders. 

Digital overload forces 

us to choose: Will I 

answer that email, or 

finish my PowerPoint 

deck? Will I catch up 

on professional news 

on LinkedIn, or browse 

Twitter? 

To make these decisions 

efficiently, we 

need to develop guidelines 

that help us consistently 

(and over time, 

instinctively) determine 

what information merits 

our attention. 

Setting up digital systems 

makes us more efficient 

across the board. 

Creating email rules 

and filters, Google news 

alerts and Twitter lists 

helps translate our priorities 

into automated 

systems: Once configured, 

they manage those 

constant decisions 

about which messages, 

founder and chairman of 

SolarCity, the leader in 

home-based solar-power 

installation, to convince its 

distribution channels that 

Powerwall can win big. 

If Tesla can skillfully 

leverage these relationships, 

it should be able to build 

a compelling competitive 

advantage that won’t erode 

through product imitation. 

Consider the performance 

of Apple’s highly respected 

rivals in the smartphone 

market: Even though they’ve 

delivered products nearly 

identical to Apple’s, they’ve 

only been able to capture 

slivers of the profit pie. 

Tesla’s move into the 

battery storage arena offers 

a great lesson in ecosystem 

strategy. The next test is its 

execution. 

(Ron Adner is a 

professor of strategy 

and entrepreneurship at 

Dartmouth College’s Tuck 

School of Business and 

author of “ The Wide Lens: 

What Successful Innovators 

See that Others Miss.”) 

news stories and people 

are a priority. 

By creating a digital 

notebook system for 

projects, you’ll get adept 

at digital note-taking 

and retrieval so that all 

your work is more accessible 

and collaborative. 

And by focusing 

your LinkedIn network 

on the people that matter 

most, you can find 

a valuable new connection 

whenever you 

need it. 

So let’s stop treating 

this digital overload as 

a problem and instead 

recognize it for what 

it is: an opportunity to 

strengthen our focus 

and get smarter about 

how we use digital tools. 

(Alexandra Samuel is 

an expert in online engagement 

and the author 

of “ Work Smarter with 

Social Media.” ) 

Brought to you courtesy of First Bank Nigeria

54 

Monday 18 May 2015


55



THOMSON REUTERS 

Luxembourg’s Prime Minister Xavier Bettel poses with his partner, Belgian Gauthier Destenay (L), after their wedding ceremony at Luxembourg’s 

city hall, May 15, 2015. Luxembourg’s prime minister on Friday becomes the first serving leader in the European Union to marry 

someone of the same sex, and only the second worldwide - and all in a tiny, mostly Catholic country often considered rather conservative. 

Bettel, 42, and his civil partner Gauthier Destenay are among the first gay men to exercise their right to wed since the Grand Duchy in 

January become the latest EU state to extend full rights to same-sex marriages. REUTERS 

Washington state governor declares 

drought emergency 

VICTORIA CAVALIERE 

Washington 

state Governor 

Jay 

Inslee declared 

a 

statewide drought emergency 

on Friday, saying 

drought conditions due to a 

lack of snowpack are some 

of the worst on record in a 

region normally known for 

its drizzly weather. 

In an announcement in 

the state capital of Olympia, 

Inslee said the drought 

had “deepened dramatically 

in the past few weeks,” 

with conditions expected to 

worsen as the hot summer 

months approach. 

VW group sales fall for first time in years 

• April sales down 1.3 pct to 853,200 cars -VW 

• Monthly sales have risen at least since Dec 2010 -VW data 

Volkswagen group sales 

fell for the first time in 

at least four and a half 

years in April, raising pressure 

on the German carmaker to 

fix trouble spots laid bare by 

the shock ouster of Chairman 

Ferdinand Piech. 

Deliveries at the 12-brand 

group, including luxury division 

Audi and sports-car maker 

Porsche, slid 1.3 percent 

year-on-year to 853,200 cars, 

VW said on Friday, as slowing 

momentum in China and a 

drop in Latin American sales 

outweighed gains in Europe. 

Monthly sales at Europe’s 

largest automotive group have 

not shrunk at least since Decem- 

The emergency declaration 

will free up funds and 

water rights to help counties 

most in need, Inslee said. 

Rain totals in the state 

were equivalent to prior 

years, Inslee said. But the 

snowpack, which melts 

into streams, lakes and 

rivers and is vital to water 

supplies, was only 16 percent 

of average. 

“What we lack is snow,” 

Inslee said. “We are calling 

it a snowpack drought.” 

Washington, know as 

the Evergreen State due to 

its abundant green forests 

kept lush by heavy precipitation, 

is one of several 

western states struggling 

under drought conditions. 

ber 2010, according to company 

records checked by Reuters. 

The drop in April, published 

by VW after German 

stock markets had closed for 

the week, reflects the 4.8 percent 

decline published earlier 

this week in core brand sales 

which account for 60 percent 

of group deliveries. 

“While we felt tailwinds in 

Western Europe and North 

America and could increase 

group deliveries strongly in 

some places, South America 

and Eastern Europe remain 

challenging, especially due 

to the market development 

in Russia,” VW sales chief 

Christian Klingler said in a 

California is enduring 

its worst drought on 

record, and that state’s 

mountain snowpack, 

which usually provides 

about a third of the state’s 

water, is at the lowest level 

on record, according to 

state officials. Drought 

emergencies have also 

been declared in parts of 

Oregon and Nevada. 

Officials in Washington 

state were still deciding 

which agricultural areas will 

receive additional water resources 

and other support, 

Inslee said. In some regions, 

water was being shifted 

creek-to-creek and fish were 

being hauled to more abundant 

water, Inslee added. 

statement. 

Volkswagen Chief Executive 

Martin Winterkorn has 

pledged to tackle problems 

- such as weak profitability at 

the core VW brand and underperformance 

in the United 

States - that have come into 

focus after being flagged by 

Piech, prompting a public 

showdown with the CEO and 

the Chairman Piech’s ouster. 

While VW is struggling to 

revive business in the U.S. due 

to a lack of models in lucrative 

crossover segments, the 

Wolfsburg-based carmaker 

is also grappling with slowing 

demand in China, a steady 

source of group profit in past 

“We are seeing things 

happen at this time of year 

we just have never seen 

before,” the Democratic 

governor said. “On the 

Olympic Peninsula - where 

there would normally be 80 

inches (2 meters) of snow 

today in the mountains - the 

glacier lilies are blooming.” 

State officials have estimated 

$1.2 billion in crop 

losses associated with the 

drought, he said. 

Drought conditions also 

mean the annual wildfire 

season could be longer and 

more destructive, Inslee 

said. Last year, Washington 

state endured one of its 

worst wildfire seasons on 

record. 

years and destination of more 

than a third of its models. 

“The risks from the (VW 

brand) sales numbers and 

China news pose material 

downside risks to earnings 

per share” at VW, Morgan 

Stanley said on Thursday in a 

note to analysts. “We think the 

upside for the group is being 

overestimated.” 

The group did not break 

out regional sales figures 

for the month of April but 

said that deliveries in Brazil 

were down 26.7 percent at 

200,400 vehicles in the first 

four months of 2015, while 

sales were up 0.2 percent at 

1.19 million in China. 

The forgotten task... 

Continued from back page 

quintessentially French. 

From the fissiparous divisions 

of warring dukedoms 

from Normandy to 

Angouleme in the eighteenth 

century, the French 

forged a single state and 

nation, united together 

by their love of liberty, 

equality and fraternity. The 

revolution and Bonaparte 

did their part. Succeeding 

generations of statesmen 

from Louis XIV to Cardinal 

Richelieu to Charles de 

Gaulle, Pierre Mendes- 

France and François Mitterrand 

took up the mantle 

of nation building and 

never relented. For them, 

France is an eternal idea 

to be nurtured, sustained 

and advanced forever. 

Is Nigeria a country? 

Juridically, yes. Are we a 

nation? Sadly, not yet. 

The task of the coming 

generations of leaders is to 

give our people a sense of 

nationhood. That cannot 

be achieved by sectionalising 

and privatising government. 

We need a broadbased 

government that has 

a place for everyone. There 

are various other vehicles 

that can enhance nation 

building. One of them is 

the railways. I have always 

harped on the fact that 

railway workers in postindependence 

Nigeria 

were people who felt they 

belonged together. The 

parents of both Azikiwe 

and Ojukwu worked in 

the railways. Hausa became 

the first language of 

their children. When the 

S.Africa unions expected to sign 

public sector wage deal -sources 

Most of South Africa’s 

public sector 

unions are expected 

to accept the government’s 

7 percent final wage 

hike offer on Friday, averting 

a potentially crippling strike, 

two sources said. 

About 1.3 million teachers, 

police officers and 

health workers were voting 

this week on the government’s 

offer. 

“It is almost a certainty 

we will put pen to paper 

this afternoon,” one source 

told Reuters. 

“The majority unions 

will sign and we expect a 

deal to be signed this afternoon,” 

said a second source. 

Unions initially wanted 

15 percent but lowered 

their demand to 10 percent 

as the government, under 

pressure to contain costs 

during a period of slack 

railways died Nigerians 

became strangers to one 

another. Other unifying 

vehicles include football, 

sports and youth and development 

programmes. 

The NYSC was once a 

great unifying vehicle, but 

I doubt if it still is. The unity 

schools did their part, 

but they are a shadow of 

what they once were. I do 

hope and pray this message 

will not be lost on 

our new leaders. Nigeria 

can be fixed. Our country 

can be made to work. But 

we must begin, as it were, 

from the basics. We have 

to give our people a sense 

of purpose and collective 

destiny. The great Cambridge 

political philosopher 

Sir Ernest Barker, 

on his study of Greek political 

theory, taught that 

prosperous democracies 

can only emerge where 

the people have sense of 

collective spiritual identification. 

Toleration as a political 

virtue has been harped 

upon since the times of 

John Locke and Thomas 

Jefferson. Nigerians must 

learn to be more tolerant 

and more respectful 

of one another’s cultures 

and belief systems. A great 

deal of it must begin from 

the classroom. We should 

bring back the study of history 

in the curriculum and 

ensure our young people 

understand the glory that 

was Nigeria in the past, the 

challenges of the moment 

and the promise of greatness 

that is our manifest 

destiny. 

economic growth, dug in 

its heels. 

The state offered to adjust 

salaries in the second 

and third years to average 

South Africa’s consumer 

price index (CPI) plus one 

percent. For the current 

year it proposes average 

projected CPI, forecast by 

Treasury at 4.8 percent, 

plus 2.2 adjustment. 

Besides the salary hike, 

the government has offered 

a medical aid increase of 

28.5 percent and a housing 

allowance of 1,200 rand. 

Five years ago, just after 

South Africa hosted 

the Soccer World Cup, 

hundreds of thousands 

of public sector workers 

shut down schools and 

hospitals in a protracted 

and violent strike, the last 

major industrial action in 

the sector.


BUSINESS DAY 

57 


Congo tells UN its offensive against 

Rwanda rebels going well 

LOUIS CHARBONNEAU 

The army of Democratic 

Republic 

of the Congo has 

been making progress 

in an offensive 

against Rwandan rebels in the 

country’s conflict-torn east, 

despite the withdrawal of 

United Nations support for the 

operation, Kinshasa told the 

U.N. Security Council. 

In a May 8 letter to the president 

of the 15-nation council, 

Raimonda Murmokaite, 

released on Friday, Congo’s 

U.N. mission also reiterated 

its desire to agree on an “exit 

strategy” for the withdraw of 

the U.N. peacekeeping force 

in Congo, MONUSCO. 

Western diplomats say a 

months-long Congolese army 

(FARDC) campaign against 

the Democratic Forces for 

the Liberation of Rwanda 

(FDLR) rebels has achieved 

little and revived doubts about 

the will and capacity of Congo 

to defeat a group at the heart of 

decades of conflict in Africa’s 

Great Lakes region. 

Kinshasa has a different 

view, and described the operation 

in a positive light. 

“These operations continue 

to have encouraging results,” 

Congo’s U.N. Ambassador 

Ignace Gata Mavita wrote 

to Murmokaite. “In South 

Kivu, the Uvira, Shabunda 

and Mwenga roads have been 

entirely cleared of FDLR sanctuaries, 

headquarters and 

command structures.” 

“The efforts of FARDC will 

now focus mainly on the Kalehe, 

Kabare and Walungu roads 

in this province, as well as the 

roads of North Kivu province 

that have not yet been cleared 

of FDLR,” he added. 

United Nations peacekeepers 

and FARDC had 

jointly planned a military 

campaign to take on the 

FDLR, which includes former 

soldiers and Hutu militiamen 

responsible for Rwanda’s 1994 

genocide, after it failed to 

meet a January deadline to 

disarm. 

But MONUSCO withdrew 

planned support for the anti-FDLR 

operations, which 

would have ranged from food 

and transport to surveillance 

drones and attack helicopters, 

after Congo appointed two 

generals to head the offensive 

who are both accused of human 

rights abuses. 

In March, the Security 

Council refused to cut 

the number of MONUSCO 

peacekeepers in Congo until 

progress was made in the 

campaign against the FDLR, 

snubbing government calls 

for a decrease. 

Dozens of armed groups 

operate in eastern Congo, 

where a 1998-2003 conflict 

killed millions of people, 

mostly from hunger and disease. 

Both state and rebel 

forces have been accused by 

rights groups of rape, killing 

civilians and other war crimes. 

In 2013, MONUSCO’s 

3,000-strong U.N. intervention 

brigade helped Congolese 

forces defeat Tutsi-led M23 

rebels who had seized swaths 

of North Kivu. U.N. sanctions 

experts, Kinshasa and Western 

governments had accused 

Rwanda of supporting M23. 

Saudi man gets life in U.S. prison for 

ties to Africa embassy bombings 

JOSEPH AX 

A 

Saudi man whom U.S. 

authorities described 

as a top Osama bin 

Laden deputy was sentenced 

to life in prison on Friday in 

connection with the deadly 

1998 bombings of U.S. embassies 

in Kenya and Tanzania. 

Khalid al-Fawwaz was 

sentenced by U.S. District 

Judge Lewis Kaplan after 

being convicted of four conspiracy 

counts in New York 

in February. 

He was not charged with 

helping to plan the attacks, 

which killed 224 and injured 

more than 4,000. Instead, 

prosecutors said he was bin 

Laden’s “bridge to the West” 

in London, disseminating 

the al Qaeda leader’s violent 

messages to media outlets 

and sending supplies to the 

group’s members in Africa. 

U.S. authorities also accused 

al-Fawwaz of running 

an al Qaeda training camp in 

Afghanistan in the 1990s and 

helping to establish a cell in 

the Kenyan capital of Nairobi 

that later conducted surveillance 

ahead of the embassy 

bombing there. 

Several victims and relatives 

on Friday urged Kaplan 

to impose a life sentence. 

“I worship the same God 

you say you do,” said Ellen 

Karas, an embassy worker 

left permanently blind by the 

August 7, 1998, bombing in 

Nairobi. “But my God is not a 

vengeful and angry God. My 

God is full of love.” 

Edith Bartley, whose father 

and brother died in the 

Nairobi blast, said the attacks 

had caused her “unbearable 

pain and sorrow.” 

“Mr. Al-Fawwaz, you are a 

travesty to the human race,” 

she said. 

Before the sentence 

was imposed, al-Fawwaz 

turned and addressed the 

victims, saying words could 

not express his sadness at 

the “tragic violence that occurred.” 

“I do not support violence,” 

he continued. “I never 

intended for any of my 

activities to contribute to it.” 

His statement echoed 

the defense his lawyers presented 

at trial, portraying 

him as a peaceful dissident 

who shared with bin Laden a 

desire for reform in their native 

Saudi Arabia but turned 

away as bin Laden grew increasingly 

radicalized. 

“My goal was reform, not 

rebellion,” al-Fawwaz said 

on Friday. 

But Kaplan rejected that 

assertion as “untruthful,” 

saying al-Fawwaz clearly 

supported bin Laden’s 

threats against Americans. 

In a statement, Manhattan 

U.S. Attorney Preet Bharara 

said, “Fawwaz conspired 

with a murderous regime, 

and the result was a horrific 

toll of terror and death.” 

Al-Fawwaz was arrested 

in London in 1998 and extradited 

in 2012 following a 

legal battle. He is the 10th 

defendant convicted in connection 

with the bombings, 

according to prosecutors. 

The case is U.S. v. al-Fawwaz, 

U.S. District Court for 

the Southern District of New 

York, No. 98-1023.



Access Bank Rateswatch 

KEY MACROECONOMIC INDICATORS 

Indicators Current Figures Comments 

GDP Growth (%) 3.96% Q1 2015—a decrease of 198 basis points over Q4 2014 

Broad Money Supply (M2) (N’ trillion) 16.55 Decreased by 1.55% in Feb‘2015 from N16.81trillion in Jan’15 

Credit to Private Sector ( N’ trillion) 18.64 Increased by 2.53% in Feb’2015 from N18.18 trillion in Jan’15 

Currency in Circulation ( N’ trillion) 1.62 Decreased by 2.41% in Feb’2015 from N1.66 trillion in Jan 2015 

Inflation rate (%) (y-o-y) 8.7 Increased to 8.7% in April 2015, it was 8.5% in March 2015 

Monetary Policy Rate (%) 13 Raised to 13% in November 2014 

Interest Rate (Corridor) 13 (-/+2) Deposit rate changed to 11 & Lending to 15% 

External Reserves (US$ million) 29.79 May, 14 2015 figure — an increase of 0.37% from month-start 

Oil Price (US$/Barrel) 66.76 May. 15 2015 figure — a decrease of 1.04% from $67.46 in 1week. 

Oil Production mbpd (OPEC) 1.93 November 2014 figure— an increase of 0.52% from Oct 2014 figure 

STOCK MARKET 

COMMODITIES MARKET 

Indicators Friday Friday Change(%) Indicators 15/5/15 1-week YTD 

Change Change 

15/5/15 8/5/15 

(%) (%) 

NSE ASI 34,439.52 34,388.12 0.15 

Energy 

Crude Oil $/bbl) 66.76 (1.04) 

22.63 

Market Cap(N’tr) 11.70 11.68 0.16 Natural Gas ($/MMBtu) 3.01 9.45 

(0.66) 

Agriculture 

Volume (bn) 1.63 1.61 0.92 Cocoa ($/MT) 3.10 5.02 4.31 

Value (N’bn) 14.43 21.50 (32.90) 

Coffee ($/lb.) 138.15 2.71 

(16.09) 

Cotton ($/lb.) 66.45 1.22 9.22 

MONEY MARKET 

Sugar ($/lb.) 12.98 

(0.23) (11.70) 

Wheat ($/bu.) 513.25 7.77 

(14.49) 

NIBOR 

Metals 

Tenor Friday Friday 

Change Gold ($/t oz.) 1,217.20 2.70 1.61 

(%) (%) (Basis Point) Silver ($/t oz.) 17.49 6.91 8.36 

15/5/15 8/5/15 

Copper ($/lb.) 291.10 (0.12) 

2.57 

Call 13.5417 9.2917 425 

NIGERIAN INTERBANK TREASURY BILLS TRUE YIELDS 

7 Days 0.0000 0.0000 0 

30 Days 14.7638 13.1585 161 


Change 

(%) (%) 

60 Days 0.0000 0.0000 0 

15/5/15 8/5/15 

90 Days 15.6932 14.4175 128 

1 Mnth 13.12 10.59 254 

2 Mnths 13.25 10.88 237 

FOREIGN EXCHANGE MARKET 

3 Mnths 13.44 10.92 252 

Market Friday Friday 

1 Month 6 Mnths 14.03 12.56 146 

(N/$) (N/$) Rate (N/$) 9 Mnths 14.85 14.76 9 

15/5/15 8/5/15 

15/4/14 12 Mnths 14.99 14.98 1 

Official (N) 197.0 197.00 168.00 

Inter-Bank (N) 199.10 199.10 189.14 Access Bank Nigerian Gov’t Bond Index 

BDC (N) 0.00 0.00 0.00 

Parallel (N) 0.00 0.00 0.00 Indicators 15/5/15 8/5/15 Change (%) 

Index 2,068.54 2,057.36 0.54 

BOND MARKET 

Mkt Cap Gross (N'tr) 6.12 6.08 0.54 

AVERAGE YIELDS 

Mkt Cap Net (N'tr) 4.25 4.23 0.51 

YTD return (%) 5.00 4.43 0.92 


Change YTD return (%)(US $) -1.23 -1.28 0.09 

(%) (%) (Basis Point) 

15/5/15 8/5/15 

TREASURY BILLS (AUCTION) 

3-Year 13.66 13.86 

(20) 

5-Year 13.67 13.85 

(17) 

Tenor 

Amount 

(N' million) 

Rate (%) Date 

7-Year 13.63 13.79 

(15) 91 Day 45,177.87 10.09 06-May-2015 

10-Year 13.59 13.80 

(21) 182 Day 23,432.8 12.89 06-May-2015 

20-Year 16.56 16.40 16 

364 Day 82,000 13.40 06-May-2015 

Disclaimer 

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

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

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

responsibility or liability for errors or fact or for any opinion expressed herein .This 

document is for information purposes and private circulation only and may not be 

reproduced, distributed or published by any recipient for any purpose without prior 

express consent of Access Bank Plc. 

Sources: CBN, Financial Market Dealers Association of Nigeria, 

NSE, Energy Information Agency, Bloomberg and Access Bank 

Economic Intelligence Group computation 

For enquiries, contact: Rotimi Peters (Team Lead, Economic Intelligence) 

(01) 2712123 rotimi.peters@accessbankplc.com 

Market Analysis and Outlook: May 15 - May 22, 2015 

Global Economy 

In China, the People’s Bank of China (PBoC) 

lowered its benchmark lending and deposit 

rates by 25 basis points to 5.10% and 2.25% 

respectively amid concerns over the 

nation's economy. The cut, which is the third 

in six months, follows other measures 

designed to spur growth in China, including 

tax cuts. China'sexpanded at its slowest 

pace in six years in thequarter at 7%, 

weighed down by a cooling property market. 

Initial indicators and industry surveys for 

April released over the last few weeks had 

signaled a further loss of momentum 

heading into the second quarter. In 

particular, Inflation remained soft, while 

exports and imports both decreased in April. 

In other news, the Eurozone economy grew 

by 0.4% in Q1 2015, official figures show. 

This is the fastest quarterly growth rate for 

2years. Although the latest figure was 

slightly below analysts’ expectations, it 

shows growth in the bloc has been gathering 

momentum slowly over the past year. 

Specifically, France’s economy grew at its 

fastest rate in nearly two years, expanding 

by 0.6% in Q1 and strongest since Q2 2013 

when the economy grew by 0.7%. On the 

other hand, Germany’s economy expanded 

by just 0.3%in the review period. This is 

below analysts’ estimates of 0.5% and down 

from 0.7% seen in Q4 2014. Germany’s 

growth was held back by a fall in exports. In 

t h e U K , l a t e s t f i g u r e s s h o w t h a t 

unemployment has continued to fall and the 

number of people in work has continued to 

rise. In Q1 2015, the number of people out of 

work fell to 1.83 million – down 35,000 from 

Q4 2014 and lowest for seven years. At the 

same time, the total number in work rose to 

31.1million in the period under review. 

Average pay for employees, excluding 

bonuses, rose by 2.2% in the quarter 

compared with a year earlier. The figures 

mean that regular pay is now growing at its 

fastest rate for nearly four years. It is also 

the seventh month in a row that the rate of 

regular pay increases has outperformed the 

prevailing annual rate of inflation, as 

measured by the consumer prices index. 

Domestic Economy 

The Nigerian economy expanded at a slower 

pace during the first quarter of 2015. More 

specifically, real GDP growth at factor cost 

slowed to 3.96% y-o-y during Q1 2015, 

down from 5.94% y-o-y in Q4 2014. The 

NBS highlights that the oil industry 

contracted by 8.15% y-o-y in Q1, mainly on 

account of a drop in crude oil output to 2.18 

million bpd from 2.24 million bpd in Q1 2014 

a year earlier. On a slightly more positive 

note, crude oil output has remained 

relatively stable during the last two 

quarters. The non-oil sector grew by 5.59% 

in real terms in Q1 2015 from the 8.21% 

recorded one year previous. In related 

development, Nigeria’s consumer price 

inflation continued its upward trend in April. 

The overall Consumer Price Index (CPI) 

increased by 0.8% m-o-m in April, which 

raised the year-on-year (y-o-y) rate to 

8.7%, up from 8.5% in March, according to 

new figures released by the National Bureau 

of Statistics (NBS). The faster pace of the 

Headline index is attributed to increases in 

m o s t C l a s s i f i c a t i o n o f I n d i v i d u a l 

Consumption by Purpose (COICOP) 

Divisions which contribute to the headline 

index, with the exception of slower 

increases in Recreation and Culture, and 

Communications Divisions. The food subindex 

(consisting of both farm produce and 

processed food) increased by 0.9% (m-om), 

which took the y-o-y increase to 9.5%. 

Meanwhile, the so-called core price index 

(excluding farm produce but including 

processed food) recorded inflation at 7.7% 

y-o-y in April, up from 7.5% y-o-y a month 

earlier. 

Stock Market 

Last week, there was a reverse of previous 

week’s dull performance. Equities closed 

the week on a bullish note over broadened 

appetite by investors on account of 

impressive score cards released by bluechip 

companies. Major movements were 

seen in highly capitalised banking stocks as 

sentiment stayed positive. The Nigerian 

Stock Exchange All Share Index (NSE ASI) 

added 0.15% to close at 34,439.52points 

from 34,388.12points recorded the week 

earlier. Similarly, market capitalization rose 

to N11.70trillion from N11.68trillion during 

the same period. Market optimism is 

expected to persist this week given 

anticipated positive financials from bluechip 

establishments. 

Money Market 

Last week, the Nigerian Interbank Offered 

Rate (NIBOR) continued its upward 

movement across tenors. The uptick was 

driven majorly by outflows of about 

N154billion in treasury bills and N60billion 

FGN Bond auction. Maturing T-bills of 

N81.01billion last week was unable to ease 

market tightness. Rates may trend 

southwards this week in anticipation of 

inflows from maturing T-bills totalling 

N302.5billion. 

Foreign Exchange Market 

For the fourth consecutive week, the 

exchange value remained flat to close at 

N199.1/US$. The naira exchange rate has 

remained unsurprisingly stable following the 

introduction of the 'order-based' system in 

February with the CBN bid/offer rate also 

stable at N196.00/N197.00. This week, we 

expect the local unit to remain range-bound. 

Bond Market 

Average bond yield moderated downwards 

across most maturities for the week ended 

May 15, 2015. The continued decline in 

yields was due to increased investors' 

appetite for government securities despite 

liquidity tightness. The Access Bank Bond 

Index rose by 0.54% to close the week at 

2,068.54points from 2,057.36 the previous 

week. Market Capitalization also climbed by 

N40billion, or 0.54%, to N6.12trillion. Yields 

may likely trend downwards this week as 

market participants maintain the buying 

pressure. A clearer direction may be seen as 

the CBN hold its MPC Meeting today Monday 

May 18, 2015 and tomorrow Tuesday May 

19, 2015. 

Commodities Market 

Crude oil (Bonny light) prices descended to 

$66.76 per barrel from $67.46 reached the 

week earlier. Oil prices have fallen on the 

back of supply from Saudi Arabia. Expected 

conclusions on the Iran nuclear deal may also 

be driving prices down. On the other hand, 

gold and silver prices increased to $1,217.20 

and $17.49 per ounce from $1,185.20 and 

$16.36 respectively, reached the week 

earlier. The yellow metal is being supported 

by a weakening economic outlook for the 

U.S., which has eroded expectations of a Fed 

rate hike, and consequently weighed on the 

dollar. This week, oil prices may stay around 

current levels above the $60 mark due to the 

net-off between constant supplies from 

Saudi Arabia and tensions in the Middle East. 

MONTHLY MACRO ECONOMIC FORECASTS 

Variables 

May’15 Jun’15 

Jul’15 

Exchange Rate 

(Official) (N/$) 198.00 198.50 200.00 

Inflation Rate (%) 8.8 8.9 8.9 

Crude Oil Price ` 64.14 65.20 67.15 

(US$/Barrel) 

* Revised


BUSINESS DAY 

59 


Family members of officers killed in the line of duty are escorted to seats of honor at the National Peace Officers’ Memorial Service at the 

U.S. Capitol in Washington May 15, 2015. REUTERS 

Carl Icahn invests $100 mln in 

ride-sharing service Lyft 

In an uncharacteristic 

move, activist investor 

Carl Icahn’s Icahn 

Enterprises LP made 

a $100 million investment 

in Lyft Inc., adding momentum 

to the ride-sharing 

company’s rapid expansion 

but leaving its cash pile far 

behind rival Uber. 

Icahn joins a long list of 

backers for the three-year 

old startup, including Andreessen 

Horowitz, New Yorkbased 

technology hedge-fund 

Coatue Management, Chinese 

e-commerce giant Alibaba, 

and hedge fund Third Point 

Management. 

Lyft, known for cars displaying 

a pink moustache 

logo, uses a smartphone app 

to match riders with paid 

drivers who use their own cars 

rather than livery vehicles, a 

service similar to one offered 

Portugal has received at 

least three bids for the 

struggling state-owned 

flag carrier TAP in its second 

attempt to privatise it since 

2012, sources said on Friday, 

as the government prepared 

to give an update on the 

process. 

With Friday’s 1600 GMT 

deadline for binding offers 

now past, Transport Secretary 

Sergio Monteiro and 

Treasury Secretary Isabel 

Castelo Branco will hold a 

news briefing at 8 p.m. (1900 

GMT), a spokesman at the 

economy ministry said. 

A source with knowledge 

of the process told Reuters 

Brazilian-American businessman 

David Neeleman 

had presented a bid. Neeleby 

Uber Technologies Inc. 

But Uber, with a global 

presence, more diverse services 

including limousine-like 

rides, a global presence, and 

aspirations of expanding into 

logistics, is a much bigger 

company. It carries a $40 billion 

valuation compared to 

Lyft’s $2.5 billion. 

Lyft backers question 

whether Uber’s broader mandate 

amounts to a valuation 

that is effectively 16 times 

greater than Uber. In many of 

its international markets, including 

China, Uber is facing 

tough competition from entrenched 

local players, while 

in others, such as Korea, it 

faces legal hurdles. 

Uber fans say that building 

a global brand ultimately will 

make the company a stronger 

player, even if it faces setbacks 

in some markets along the 

way. 

Technology has been a 

big part of Icahn’s investment 

focus, with bets like Apple, 

Nextflix and eBay, but he 

generally does not invest in 

companies as young as Lyft, 

which was founded in 2012. 

Last year, Icahn accused 

Andreessen Horowitz partner 

Marc Andreessen, who was a 

board member of eBay at the 

time, of having a conflicted 

role because of Andreessen’s 

venture investments that 

competed with eBay. 

On CNBC, Andreessen 

compared Icahn to a lying 

six-year-old. Now that he and 

Icahn will be co-investors in 

Lyft, he is making light of the 

past squabble. 

“All’s fair in love, war and 

ride-sharing,” Andreessen 

said in a statement emailed 

to Reuters. 

One of Icahn’s managing 

directors, Jonathan Christodoro, 

will join Lyft’s board, 

Lyft said in a statement on 

Friday. 

Brait bets on British high street 

with $1.2 bln New Look deal 

• Brait’s second major deal in a month 

• Enters fiercely competitive UK fashion retail market 

TIISETSO MOTSOENENG 

African investment 

heavyweight Brait SE 

will pay $1.2 billion for 

virtually all of budget clothes 

retailer New Look, giving 

it a substantial presence in 

Britain’s fiercely competitive 

fashion retail market. 

The deal, announced on 

Friday, puts Brait, whose top 

shareholder is South African 

retail mogul Christo Wiese, 

in the middle of the crowded 

British high street, where 

New Look vies with Primark, 

part of AB Foods, Next and 

H&M. 

New Look, owned by private 

equity groups Apax and 

Permira, as well as founder 

Tom Singh, has 600 stores in 

the UK and Ireland and trades 

from a further 200 across Europe, 

North Africa, the Middle 

East and Asia including China 

where it wants to expand. 

It is the second big deal 

in a month for Brait, one of 

Africa’s largest investment 

houses which is also buying 

fitness chain Virgin Active. 

Brait will take a 90 percent 

equity stake in New Look for 

780 million pounds ($1.23 

billion), giving the retailer an 

enterprise value of 1.9 billion 

pounds, which includes 1 

billion pounds in debt. The 

remaining stake will stay in 

the hands of the founding 

family and management. 

Brait shareholder Momentum 

Asset Management, 

which has more than 1.6 

billion rand funds under its 

custody, said it was a strategic 

move into the British market 

that should be less risky than 

some African ones. 

“It’s a lot of money Brait is 

paying and the UK market is 

highly competitive,” Wayne 

McCurrie, fund manager at 

Momentum, which, according 

to Thomson Reuters data, 

owns a stake worth just under 

$10 million. 

“But on the bright side it 

is not as risky as Nigeria, for 

example, and over time to 

diversify is actually a logical 

strategic move.” 

Portugal gets at least three bids in TAP airline sale -sources 

SERGIO GONCALVES 

man is the founder of U.S. 

airline JetBlue and CEO of 

Azul Brazilian Airlines. 

“It was a bid presented by 

the holding company of David 

Neeleman, with partners,” 

the source said. 

Another source close to 

the privatisation process said 

Brazilian-Colombian investor 

German Efromovich, who 

controls Latin America’s Avianca 

via his holding Synergy 

and who had already bid for 

TAP once, also made an offer. 

The source would not give 

details on whether Efromovich 

was bidding alone or with 

partners. A newsletter published 

by Airline Economics 

magazine reported earlier 

Efromovich was bidding, as 

well as U.S. fund Greybull 

Capital. 

A third source close to 

Portuguese investor and aristocrat 

Miguel Pais do Amaral, 

who has interests from media 

to mining, said Pais do Amaral 

had made a bid via his 

private holding company, 

Quifel. 

Heavily indebted TAP was 

hit by a 10-day pilots strike 

earlier this month, which the 

government warned could 

discourage bidders. But it 

vowed to go ahead with the 

sale and said it still hoped get 

competing bids. 

The government is selling 

a 61 percent stake in TAP, 

retaining a 34 percent stake 

that can be sold in two years. 

Another five percent will be 

offered to TAP employees. 

Brazilian Vice President 

Michel Temer said last month 

he had discussed the sale of 

TAP with Brazilian airlines,

60 

Monday 18 May 2015


NewsXtra 

Jonathan seeks forgiveness from 

Nigerians he may have offended 

ELIZABETH ARCHIBONG, Abuja 

President Goodluck 

Jonathan 

has sought forgiveness 

from 

Nigerians who 

he may have offended while 

in office. 

Speaking during a farewell 

service organised for 

the outgoing first family 

on Sunday at the Aso Villa 

Chapel, the president said 

no one is perfect and there 

is no way he would not have 

stepped on toes. He added 

that this would not have 

been deliberate. 

He noted that there are 

times when one would take 

a decision in the best interest 

of all but even friends 

would misunderstand the 

situation. 


The National Insurance 

Commission 

(NAICOM) 

has dissolved the 

board of the International 

Energy Insurance (IEI) following 

allegations against 

some directors of the company, 

among others. 

In its place, a threemember 

interim board has 

been appointed to oversee 

the affairs of the company 

while necessary investigation 

is being conducted. 

As part of this intervention, 

the chief executive 

officer and some key officers 

will proceed on leave 

to pave way for a thorough 

investigation of the affairs 

of the company, Rassaq 

OWEDE AGBAJILEKE, Abuja 

First Lady, Patience 

Jonathan, has harped 

on the need for women 

to use their positions 

to positively impact 

the society and the less privileged. 

She gave the challenge 

on Sunday in Abuja at the 

Miss United Nations Nigeria 

Pageant 2015 while congratulating 

Precious Chikwendu, 

winner of the 2014 edition 

of the pageant in Kingston, 

Jamaica. 

According to her, Chikwendu 

brought honour to 

Nigeria by virtue of her not 

only winning the crown, but 

the hosting right for the Nigerian 

version of the pageant. 

Represented by Peace 

Nnaji, the president’s wife, 

however, added that the 

beauty of a woman grows 

with the passing years. 

“So for the eight (years) 

that one has been there, 

definitely one is not perfect. 

We have certain done things 

that probably we wouldn’t 

have done that way, but we 

didn’t do things deliberately. 

So for those who we 

have offended it was not 

deliberate, it was circumstances 

of the office. So we 

also plead that those people 

should forgive, we think we 

have done our best. 

“You can do your best 

and your friends may misunderstand 

you. Today, we 

are talking about leaving. It 

is only God that knows why 

things go the way they do. 

Ordinarily May 24 would 

have been the last service 

here. But that 24th, we will 

all go to the National Christian 

Centre for the inauguration 

service. So for me 

Using her Snow White 

Foundation NGO, the outgoing 

queen, Chikwendu, 

said she adopted a life cycle 

approach of development 

focusing on children, families 

and the larger community 

with emphasis on the less 

privileged. 

It was gathered that contestants 

at the 2015 Nigerian 

version of the pageant were 

assessed on the basis of character, 

personality, conversational 

skill, beauty, fashion 

and intelligence. 

The pageant had a category 

for spinsters, married 

women, single mothers as 

well as teens. 

Winners of the teens and 

married women categories 

would be further groomed 

and would join Miss United 

Nations (Nigeria) to represent 

Nigeria at the main 

Miss United Nations Pageant 

holding in July in Kingston, 

Jamaica. 

and my wife, this is our last 

day of worship here. The 

congregation will continue 

until new government takes 

over”, he said. 

This is the last Sunday 

the first family will be officially 

worshipping at the 

Aso Rock Villa Chapel. 

Meanwhile, the vice 

president-elect, Yemi Osinbajo, 

was absent at the farewell 

service which would 

have seen the president 

officially handing over the 

chapel to him. 

However, speaking to 

newsmen after the Sunday 

service, the Aso Rock 

chaplain, Obioma Onwuzurumba, 

said the vice 

president-elect, had been 

duly invited but was unfortunately 

absent. He sent a 

representative in his stead. 

NAICOM dissolves International Energy Insurance board 

First lady urges women to be responsible 

Salami, head, corporate 

affairs, NAICOM, said in a 

statement on Sunday. 

The action, Salami said, 

is pursuant to the powers 

conferred on the commission 

by the enabling laws 

to intervene in the affairs of 

the company as a result of 

financial reporting failures, 

allegations made against 

some of the directors, and 

board squabble necessitating 

regulatory action in the 

interest of policyholders 

and other stakeholders of 

the company. 

Members of the interim 

board include Muhammad 

Ahmad, the former 

director-general of the National 

Pension Commission 

(PENCOM), who will 

serve as its chairman; Daisy 

Ekineh, a former commissioner 

of the Securities 

and Exchange Commission 

(SEC), and Bridget 

Adeyinka, a one-time acting 

managing director of 

Societe Bancaire Nigeria 

Ltd, now Unity Bank. 

The board is mandated 

to conduct forensic investigation 

into the affairs of 

the company and identify 

factors and persons 

responsible for the erosion 

of shareholders’ value. 

The appointment which 

takes immediate effect 

shall be for an initial period 

of six months, subject to 

renewal, if necessary. 

The company remains a 

going concern with capacity 

to continue to underwrite 

all types of general 

insurance business, Salami 

stated. 

Buhari respects ruleof-law, 

due process, 

says Amaechi 

Governor Chibuike 

Amaechi of Rivers 

said on Sunday that 

the president-elect, Muhammadu 

Buhari, had respect 

for rule-of-law and due process 

as a democrat. 

Amaechi disclosed this 

at a thanksgiving service 

in Port Harcourt organised 

by the campaign organisation 

of Dakuku Peterside, 

Rivers gubernatorial candidate 

of the All Progressives 

Congress (APC) in the justconcluded 

general elections. 

The service was to celebrate 

God’s faithfulness 

throughout the election period. 

He urged supporters of 

the APC to prepare their 

petitions against those that 

compromised the elections 

in the state and perpetrated 

different forms of malpractices. 

BUSINESS DAY 

61



NewsXtra 

Emeke Anene (r), directorate head, South, Heritage Bank Limited, representing the GMD/CEO of the bank (Ifie 

Sekibo) and Adams Oshiomhole (l), governor, Edo State, presenting dummy cheques to the three male finalists - 

Korio Alex Olotptip from Kenya (m); Leul Gabriel Salassie, an Ethiopian (2nd r) and Amos Mitel from Kenya at the 3rd 

Okpekpe Road Race, which was held at the weekend. Heritage Bank sponsored the race as official banker. 

Transition in e-commerce gains traction 

as operators expand market scope 

BEN UZOR 

The electronic 

commerce industry 

is undergoing 

a process 

of transition, 

which has seen many operators 

move from just focusing 

on Business-to-Consumer 

(B2C) to enabling 

Business-to-Business (B2B) 

services, BusinessDay investigations 

show. 

This development is 

driven by the need to deepen 

profit margins in a highly 

competitive market. Many 

operators are aggressively 

embracing an innovative 

business model predicated 

on the development of strategic 

mechanisms on their 

platforms to accommodate 

potential sellers and buyers 

of products. The implication 

of this innovative strategy is 

that e-retailers are no longer 

just in the business of selling, 

but now grant access to 

other businesses to trade on 

their platforms. 

Omobola Johnson, minister 

of communications 

technology, had said that 

the country’s e-commerce 

JOSHUA BASSEY 

The organised labour 

under the aegis 

of Trade Union 

Congress of Nigeria 

(TUC) says that the incoming 

government of Muhammadu 

Buhari would need to 

start with the declaration of 

a state of emergency in the 

power sector to show its 

determination to tackle the 

market has a potential value 

of $10 billion with about 

300,000 online orders currently 

being made daily. 

Market observers are of 

the view that e-retailers are 

keen on further expanding 

the scope of the market 

beyond its current potential 

by targeting the nation’s 

17.6 million Small Medium 

Enterprises (SMEs). 

With the online marketplace, 

e-retailers are fostering 

entrepreneurship by 

positioning micro-SMEs 

before a large homogeneous 

audience to generate 

better sales. 

“We realised that for our 

services to be really valuable 

to society, we had to 

build a platform for anyone, 

not just Konga, to sell and 

prosper. Konga had to build 

a platform that allowed every 

entrepreneur and business 

in Nigeria and beyond, 

equal opportunity to reach 

millions of customers”, said 

Gabriel Gab-Umoden, head 

of marketing, Konga.com. 

Konga launched its marketplace 

called Konga Mall 

last year and within the first 

three months, generated a 

sales revenue of over N600 

protracted power failure in 

Africa’s biggest economy. 

The congress’ concern 

comes as electricity supply 

across Nigeria continues 

to dwindle leaving the nation 

heavily dependent on 

petrol and diesel to power 

the economy despite the 

privatisation of the sector 

over two years ago in what 

was said would bring about 

some improvement from 

the abysmal performance 

million, according to Sim 

Shagaya, the company’s 

chief executive officer, in an 

interview with BusinessDay 

recently. Konga mall essentially 

acts as an online 

marketplace for sellers and 

buyers alike to compete 

against each other for a 

variety of items. 

According to Phillips 

Consulting, the local online 

shopping sector grew 

from N49.9 billion to N62.4 

billion between 2010 and 

2011, and from N62.4 billion 

to N78 billion between 2011 

and 2012, representing a 25 

percent increase in each 

period. 

Local e-retailers are already 

engaged in a heated 

battle for online shoppers, 

with many of them providing 

attractive pricing, 

easier delivery options, as 

well as aggressive marketing 

techniques to beat the 

competition. 

Seeking greener pastures, 

many e-retailers are 

plugging into the global 

trend of online marketplace 

which really entails 

the deliberate transition 

from Business-to-Consumer 

(B2C) to Business-to- 

Business (B2B) services. 

“In the next few years, 

online retail marketplace 

will be a major success story 

that will contribute largely 

to the nation’s Gross Domestic 

Product”, Jeremy 

Doutte, managing director, 

Jumia.com, said in a recent 

report accessed by BusinessDay. 

The company foresees 

e-commerce contributing 

up to 20 percent to Nigeria’s 

GDP, riding on the back 

of rising internet access, 

budding middle-class and 

a proliferation of mobile 

devices. Nigeria had about 

74 million mobile internet 

users as at November 2014, 

says the Nigerian Communications 

Commission 

(NCC). 

On the global scene, e- 

retailers such as Amazon, 

eBay, Alibaba including online 

classifieds like Online 

Exchange have all created 

platforms that enable people 

to buy and sell. Recent 

data on marketplaces of 

some giant retailers like e- 

Bay and Amazon show that 

they have over 116 to 117 

million active users on their 

marketplace platforms. 

in the days when the sector 

was 100 percent owned and 

run by government. 

Bobboi Kaigama, president 

of TUC at the National 

Executive Council (NEC) 

meeting held in Lagos, 

weekend, said rather than 

improve, supply across the 

country had “gone from bad 

to worse”. 

“Electricity has reduced 

from 4,000 to 800 megawatts. 

We believe that incoming 

administration 

should declare a state of 

emerge on power sector,’’ 

said Kaigama. 

He also noted that the 

incoming administration 

should be prepared to increase 

the salaries and allowances 

of workers from 

the current N18, 000 because 

of rate of inflation and 

increase in exchange rate. 

According to Kaigama, 

the minimum wage of 

FG’s distributable revenues fall to lowest in 5 years 

Federal Government’s 

revenues distributable 

to the three tiers 

of government hit 

a five-year low in April, the 

accountant general, Jonah 

Otunla, said weekend, due 

to frequent shutdowns of 

oil trunklines and export 

terminal pipelines. 

The total revenue distributable 

in April including VAT 

of N75.16 billion is N388.339 

billion ($1.95 billion). 

Gross revenues of 

N282.062 billion received 

for the month was lower 

than the N315.044 billion received 

in March by N32.982 

billion. 

However, an increase in 

the average price of crude 

oil from $55.34 in February 

to $56.03 in March brought 

about a $21.67 million gain 

in revenue. Non-oil revenues 

performed better in 

April than in March. 

The distributable statutory 

revenue for the month is 

N282.062 billion. The sum of 

N6.33 billion was refunded 

by the state owned energy 

firm, NNPC, to the Federal 

Government. Also, there is 

an exchange gain of N24.786 

billion which is proposed for 

distribution. (Reuters) 

Boko Haram loses 10 more camps in Sambisa Forest 

The Defence Headquarters 

on Sunday 

said an unconfirmed 

number of 

Boko Haram members fell 

to the superior power of the 

military in the ongoing offensive 

in Sambisa Forest. 

The military authority 

also said its forces on 

Saturday captured and 

destroyed 10 additional 

camps used by the terrorists. 

This is contained in a 

statement issued by the 

director of defence information, 

Maj-.Gen. Chris 

Olukolade, on Sunday in 

Abuja. 

Olukolade said the 

`Dure’ camp which was 

one of the most prominent 

camps in the forest witnessed 

the fiercest battle as 

workers “which is less than 

90 dollars can no longer 

meet the needs of many 

families.” 

The labour leader said 

it was sad that presently 

some state governments 

had yet to pay the N18,000 

minimum wage while some 

are owing workers. 

“Nigerian workers are 

wealth creators so we demand 

a fair deal,’’ he said. 

On petroleum, Kaigama 

troops descended heavily 

on it before it finally fell. 

He said four of the 

camps were located in a 

place called `Iza’ within the 

forest, while three others 

were noted to be recently 

established by the terrorists 

before the assault began. 

“One soldier died from 

one of the land mine encountered 

in the operation, 

while two others were 

wounded. 

“The terrorists lost a 

number of vehicles mounted 

with anti-aircraft guns as 

well as armoured vehicles. 

“Some of the terrorists 

who escaped from the 

camps died as they ran into 

troops’ ambush in some 

escape routes from the forest,’’ 

he said. 

Rosabon partners Mutual Benefits Insurance 

Rosabon Financial 

Services, Nigeria’s 

leading financial 

intermediary and 

equipment leasing firm, is 

now been insured by foremost 

insurance company, 

Mutual Benefit. 

This partnership will not 

only see Mutual Benefit 

providing comprehensive 

insurance for some of Rosabon’s 

investments but also 

to further give customers 

assurance that Rosabon is 

here to stay and ready to 

serve. 

“Customers can now 

enjoy the benefits that this 

partnership adds to some 

of our products. They can 

be rest assured that in the 

TUC urges Buhari to start with state of emergency in power sector 

face of unforeseen circumstances, 

their assets are safe 

and secure. This is in a bid 

to erase any doubts that 

individuals or organisations 

may have in placing 

their funds with Rosabon”, 

says Chidimma Onyeokoro, 

group head of strategy and 

marketing. 

The award-winning 

company is licensed by 

the Central Bank of Nigeria 

(CBN) and offers numerous 

financial packages under its 

credit, lease and treasury 

departments. 

Forming this synergy 

with Mutual Benefit is yet 

another statement of Rosabon’s 

constant obsession 

with customer satisfaction. 

said that the Federal Government 

should address 

the controversies with the 

marketers to resolve the 

demand and supply deficit 

of the continued scarcity of 

petroleum products. 

He said that there was 

the need to take a concrete 

step on local refining to stop 

the issue of importation of 

petroleum products and 

payment of subsidy.


AIB to release reports of four air crashes 

SADE WILLIAMS 

There are strong indications 

that the 

Accident Investigation 

Bureau 

(AIB) may at any 

moment from now make full 

public disclosure of at least 

four air crashes reports that 

had occurred in the country 

in recent time. 

Information gathered 

from a source close to the 

Ministry of Aviation on Sunday 

revealed that the impending 

reports were those 

that occurred between 2006 

and 2010. 

The source, who did not 

want to be named because 

he was not authorised to 

speak on the issue, confided 

in BusinessDay correspondent 

that among the reports 

that would be released to the 

public in the next few days 

by the bureau, is that of the 

Odengene Air Shuttle (OAS) 

Helicopters crash in Warri on 

November 10, 2006. 

Also, the Bristow Helicopter 

crash of August 3, 2007 

would be released by the 

agency, while the accident 

involving Wings Aviation 

JOSHUA BASSEY 

aircraft of March 15, 2008 

would also be released to 

the public. The other report 

that is expected to be made 

public was the one involving 

Aero Contractors on August 

21, 2010. However, AIB had, 

at different times, released 

interim reports of some of the 

accidents, but the final impending 

reports would be the 

last that would be released on 

the accidents by the bureau. 

The source told our correspondent 

that Osita Chidoka, 

the minister of aviation, 

wanted the reports published 

before the May 29, 

2015 handover date. 

The source explained that 

with the release, some of the 

report of the crashes, which 

had claimed hundreds of 

lives in recent time, would be 

in the public domain, while 

their causes and probable 

prevention would be worked 

upon by the Nigerian Civil 

Aviation Authority (NCAA) 

and operating carriers in the 

sector. 

Tunji Oketunbi, the 

spokesman for AIB, in a telephone 

interview with our 

correspondent, confirmed 

that the agency was planning 

to release some accidents 

reports, but declined to speak 

further. He said: “It is true that 

we are planning to release 

some accident reports, but 

we are still finalising the arrangements. 

This is a continuous 

exercise in AIB. As 

soon as reports are ready, we 

will release in the interest of 

the flying public.” 

It would be recalled that 

the OAS Helicopters carrying 

four people crashed on 

November 10, 2006 on the 

outskirts of Warri, Delta State, 

killing one person while others 

were seriously injured. 

Military officials on the 

scene had said that the owner 

of OAS was on board when 

the helicopter went down but 

the names of the passengers 

were not released. Officials 

said, however, that two of the 

passengers were foreigners. 

On the Wings Aviation, 

the aircraft, a Beechcraft 

1900D with registration 

marks 5N-JAH was declared 

missing for over six months 

before it was found on August 

30, 2007 by hunters at 

a village in Obanlinku Local 

Government Area of Cross 

River State. 

...union suspends picketing, insists on probe of management 

The Federal Ministry 

of Labour and 

Productivity has 

intervened in the 

protracted crisis between 

the management of the 

National Identity Management 

Commission (NIMC) 

and workers under the aegis 

of Association of Senior 

Civil Servants of Nigeria 

(ASCSN). 

The ASCSN had been 

picketing NIMC offices all 

over the country in protest 

against alleged plan by 

the management to sack 

1,000 workers, just as it insisted 

at the weekend that 

the out-going administration 

of President Goodluck 

Jonathan or incoming Muhammadu 

Buhari’s should 

probe into how funds released 

to NIMC to produce 

national identity cards for 

Nigerians had been spent. 

Chris Onyemenam, the 

director-general of NIMC, 

has, however, denied allegation 

of embezzlement of 

N30 billion leveled against 

his management and plans 

to sack 1,000 workers, describing 

them as “false and 

misrepresentation of facts”. 

At a tripartite meeting in 

Abuja on Friday attended by 

officials of the ministry, the 

leadership of ASCSN, and 

the NIMC management, all 

NewsXtra 

L-R: Akeem Adesina, divisional head, operation and technology; Waheed Olagunju, 

executive director, small and medium enterprises; Mohammed Alkali, executive director, 

large scale enterprise, and Rasheed Olaoluwa, MD/CEO, all of Bank of Industry (BoI), during 

the bank’s one-day interactive session on various achievements of the bank in Lagos at 

the weekend. 

Pic by Pius Okeosisi 

Ministry wades into NIMC, workers’ crisis 

parties agreed to maintain 

status quo ante and abide 

by the directive of the ministry 

contained in its letter 

Ref. No/ML.HB/8242/1/20 

of February 18, 2015 to the 

commission ordering it 

to put on hold any plan to 

sack pending the outcome 

of the reconciliation process 

started by the ministry 

following a trade dispute 

declared by the ASCSN. The 

meeting came on the heels 

of trade union actions embarked 

upon by the ASCSN 

throughout last week during 

which activities in all 

the offices of NIMC in the 36 

states and Abuja were paralysed 

by ASCSN members 

who picketed them. 

Abia is fertile for investment 

CHARLES AJUNWA 

As the process of 

deepening democracy 

continues to 

take root in Abia 

State and the state becoming 

one of the safest and 

most secured in the country, 

there is no gainsaying the 

fact that Abia is more than 

fertile for increased investments. 

Huge investment opportunities 

exist in Abia. 

There are investment opportunities 

in oil and gas, agriculture, 

mineral resources, 

tourism, real estate and 

education. 

Mineral resources 

abound in commercial 

quantities in the state, but 

yet untapped. They include 

kaolin, galena, granite, gypsum, 

tar sand, phosphate 

and black marble, copper 

and gold. 

Tourism and hospitality 

industry remains a fertile 

ground for investors with 

the increasing mobile population 

of the state. 

Also huge investment 

opportunities exist in real 

estate, for middle and high 

scale housing developments, 

especially in the 

urban areas of Umuahia, 

Aba and Ohafia. 

In the area of agriculture, 

Abia has fertile land and 

the area of comparative 

advantage for foreign and 

local investment is in the 

production of cassava, while 

opportunities abound in 

cocoa processing and beverages, 

rice milling and fruit 

canning. 

With improved energy 

expected from two new 

power stations in Aba, the 

NIPP at Alaoji and a private 

power station promoted by 

Geometric Power Limited 

(GPL) at Osisioma, Aba, 

Abia State, the state is now 

ready to attract more investments. 

His Excellency, Governor 

Theodore Orji at the 

Canada-Nigeria investment 

conference held recently in 

Toronto encouraged investors 

to come over to the state 

to invest, as the doors of the 

state are open for them and 

other foreign investors. 

Orji said: “At the meeting, 

we told them different areas 

of interest, where they could 

invest in, such as oil and 

gas, environmental control, 

mining, agriculture and 

industry. After the meeting 

I still held another meeting 

to meet the investors, and I 

am sure they will come over 

soon”. 

The prevailing peace in 

Abia State, especially in the 

Aba area, its commercial 

hub, is catching the attention 

of foreign countries that 

are interested in investing in 

the state. 

Gov. Theodore Orji 

Abia State in February 

2013 played host to three 

envoys, namely Jeffrey 

Howkins, the United States’ 

consular-general in Nigeria; 

Boon Intiratana, the commercial 

councilor of the 

Royal Thai Embassy and 

Hoang Ngoc Ho, Vietnamese 

ambassador to Nigeria, a 

feat that is unprecedented in 

the history of the state. 

While the Kingdom of 

Thailand is interested in 

partnering the state in agriculture, 

tourism and agroprocessing, 

Vietnam proposed 

trade cooperation in 

agriculture, manufacturing, 

construction, pharmaceuticals, 

textile and services. 

Abia, apart from having 

a large concentration of micro, 

small and medium entrepreneurs, 

also has great 

potential in agriculture, as 

rice, maize, cassava, rubber 

and cashew are cultivated in 

commercial quantity. 

Governor Orji, while 

hosting Hawkins, urged the 

United States’ government 

to explore opportunities 

for business and other collaborations 

with the state. 

The governor expects the 

United States to find Abia a 

veritable ground for direct 

investment in agriculture, 

education, science and 

technology, among others. 

According to him, USA 

remains an important partner 

in trade and education 

with Nigeria as well as a 

model of democracy. 

It is agreed everywhere 

that economic development 

cannot thrive in an atmosphere 

of terror. For this 

reason, the return of peace 

in Abia State, especially Aba, 

remains one of the biggest 

achievements of the Governor 

Orji-led administration. 

This great feat to restore 

peace and engender economic 

development has 

been applauded by individuals 

and groups within 

and outside the country. 

Labaran Maku, former 

minister of information, 

during his ‘Good Governance 

Tour’ of the state 

acknowledged that the relative 

peace in the state has 

brought back hope, not only 

to investors, but also to all 

BUSINESS DAY 

63 

people of the state. 

For instance, the Nigerian 

National Petroleum 

Corporation (NNPC) depot 

at Osisioma, Aba, which 

was shut down as a result 

of pipeline vandalism, has 

been rehabilitated and it is 

now running. 

The closure of the facility 

about eight years ago did not 

only bring untold hardship 

to so many families, but also 

caused the death of some, 

who couldn’t bear the difficulty 

and hunger. 

Consequently, the decision 

of the present administration 

in the state to invest 

in security was to provide 

a conducive environment 

for businesses to thrive and 

subsequently create job 

opportunities for the unemployed. 

And today, millions of 

jobs have come on stream, 

as marketers are now lifting 

fuel from the depot and 

factories in Aba that closed 

down as a result of fuel are 

also back. 

To safeguard the pipelines, 

the state government 

engaged soldiers and youths 

of pipeline host communities. 

This partnership is 

working. 

The pipelines are now 

safe, enabling NNPC to 

pump products regularly to 

the depot. 


repaired the pipelines 

while the state government 

is working hard to ensure 

security with community 

leaders. 

The period between 2008 

and 2010 was indeed very 

trying for the Federal Government 

and particularly 

the people of Abia State and 

especially residents of Aba, 

following the spate of kidnapping 

and armed robbery 

in the area. During that period, 

stories of kidnapping 

and band robbery were 

common across the state. 

Even little children of 

nursery and primary school 

ages were not spared by 

the kidnappers, who made 

major Abia communities 

unsafe. This situation made 

the state to be regarded as 

a haven for bandits and 

criminal gangs. 

Apparently tired of the 

scenario and in an attempt 

to ensure that total anarchy 

was not allowed to take over 

when there is a democratically 

elected government, 

Governor Orji approached 

President Goodluck Jonathan, 

who approved the 

deployment of soldiers in 

September 2010. 

And now, peace has returned 

in Abia and the city 

of Aba has been adjudged 

as one of the safest in the 

country. 

Ajunwa is the chief press 

secretary to Abia State governor.

BUSINESS DAY 

THE WEALTH 

OF NATIONS 

Economy, finance, banking, 

policy, world economics 

OBADIAH MAILAFIA 

Mailafia is an economist with a 

DPhil from Oxford. He has also 

served as deputy Governor of 

the Central Bank of Nigeria. 

The great Swiss 

historian Jacob 

Bruchkhardt, in 

his eponymous 

work, The Civilisation 

of the Renaissance 

in Italy, famously 

described the state as “a 

work of art”. Bruchkhardt 

sought to understand the 

rise of the modern territorial 

state in the Italian 

Peninsula during the Renaissance. 

His particular 

interest was in city-states 

such as Florence, Venice, 

Sicily and others. He 

reached the fascinating 

conclusion that the citystate 

of the Renaissance 

could best be depicted as 

a work of art. As a connoisseur 

of the arts myself, I 

found this enigmatic depiction 

of the state both elegant 

and fascinating. Michelangelo 

spent several 

years painting the Sistine 

This year’s general 

election in the UK, 

held on May 7, will 

be remembered 

for its momentousness. 

In many ways it defied 

expectations and predictions, 

and has set Britain 

on an irreversible constitutional 

course. For a 

start, British voters turned 

the opinion polls on their 

heads and confounded the 

pollsters and the pundits. 

For months and up till the 

eve of the election, all the 

opinion polls said Labour 

and the Conservatives 

were neck-and-neck. They 

turned out to be wrong. 

The Tories ended up with 

2 million votes and almost 

100 more parliamentary 

seats than Labour. The 

Scottish National Party 

(SNP) also virtually annihilated 

Labour in Scotland, 

while the Liberal 

Democrats (Lib-Dem) was 

reduced to a rump. These 

are seismic changes, and 

have implications for the 

UK and lessons for Nigeria. 

I want to explore them 

in this piece, but, first, a 

The forgotten task of nation building 

Chapel in the Vatican. It 

was a task that demanded 

total concentration, effort, 

inspiration and, of 

course, high ability. When 

he completed that work he 

earned his place among 

the immortals. I am also 

reminded of the immortal 

works of the other great 

renaissance artists – Leonardo 

da Vinci, Raphael 

and others. Great works 

of art speak to us not only 

of beauty but also of truth, 

purity and immortality. 

When we envision the 

state as a work of art we 

understand it as an entity 

that is built by inspired 

statesmen. It requires 

time, patience, inspiration, 

ability and sheer nobility 

of spirit. To build a great 

state is to become an artist 

of the human spirit. Just 

as a great work of art presupposes 

a great artist, a 

great nation-state similarly 

presupposes a great statesman 

and stateswoman. 

In our day and age great 

statesmen and women 

are in short supply. It’s 

not only an African problem; 

it is a worldwide 

phenomenon. The British 

people who have lived 

together for centuries as 

Scots, Welsh, Irish and 

English narrowly missed 

breaking up their union 

in a recent referendum 

in Scotland. We have not 

seen the end of the matter 

refresher on the British 

electoral system. 

As many know, the UK 

operates a parliamentary 

rather than a presidential 

system. Thus, unlike the 

US president, the British 

prime minister is not directly 

elected by the people. 

Instead, UK voters 

elect individual MPs in 

650 constituencies across 

country. In truth, however, 

when voters elect a constituency 

MP they are by 

proxy electing the prime 

minister, because the party 

leader whose party has 

the required number of 

MPs becomes the prime 

minister. The winning 

line or overall majority is 

326 seats. Now, if a party 

has the largest number 

of seats than each of the 

other parties but does not 

have the overall majority, 

it can’t govern, except in 

one of two circumstances. 

First, it can try to run a minority 

government in the 

hope that the other parties 

would support some of its 

programmes and not collude 

to bring it down. But 

NEWS YOU CAN TRUST I MONDAY 18 MAY 2015 

yet. The giants that straddled 

the political stage in 

Britain, from Elizabeth I to 

Gladstone, Clement Attlee, 

Churchill, Macmillan and 

Margaret Thatcher have 

been replaced by little 

men who have no vision 

of the greatness of British 

civilisation and of its 

place in the world. Beyond 

Baroness Thatcher, British 

politicians have largely 

forgotten the task of nation 

building. 

The Canadians have 

been more successful at 

it. For decades, it was not 

a question of if but when 

Quebec would break from 

the Canadian federation. 

It took statesmen such 

as Pierre Trudeau to give 

Canada a sense of renewed 

purpose and destiny. 

Trudeau was a brilliant 

scion of illustrious Quebecois 

family. He was perfectly 

bilingual in French 

and English. After studying 

Law and Political Science 

in Quebec he went across 

the Atlantic to the London 

School of Economics for 

graduate work. He also 

seized the opportunity to 

travel around Europe and 

Asia. His heart and mind 

was enlarged by his experiences. 

He was determined 

to rebuild Canada as a nation 

that would be at peace 

with itself and the world. 

And I think he succeeded 

tremendously. 

Nations do not emerge 

out of the nebulous ether. 

Nations, as the historian 

Hugh Trevor-Roper (Lord 

Dacre) tells us, are “inventions” 

– constructed 

with the vision, determination 

and dexterity of 

great artists. Consider the 

case of Tanzania, a country 

replete with ethnic 

and religious divisions. 

Julius Kambarage Nyerere 

gave Tanzanians a sense 

of collective nationhood 

by making Kiswahili a national 

language. He also 

educated a whole generation 

of Tanzanians to feel 

that they are one people 

with one destiny. He put 

emphasis on literacy and 

education, patriotism and 

pan-Africanism. Today, 

Tanzanians are a much 

more united people than 

Kenyans and Ugandans. 

Nyerere will go down 

in history as one of the 

greatest statesmen to have 

come out of our benighted 

continent. 

Much ink has been 

spilled in giving gratuitous 

advice to President-elect 

Muhammadu Buhari. I 

myself have been one of 

the culprits. Beyond and 

above all the nostrums 

that have been on offer, 

almost nothing has been 

said about nation building. 

In our day and age, countries 

rise and fall by virtue 

of economic management 

this won’t produce a stable 

government. Alternatively, 

and this is a better option, 

it can form a coalition with 

another party. That’s what 

happened in 2010 when 

the Conservative party 

won 302 seats, short of 

the overall majority, but 

more than Labour’s 256. 

The Tories then entered 

into coalition with the Lib- 

Dem, which had 56 seats. 

This gave the coalition government 

a majority of 76 

seats, enough for them to 

govern for five years. They 

did successfully until this 

year’s election put them 

asunder! 

Indeed, what happened 

in the May 7 general election 

was nothing but a 

political earthquake. It 

left the fates of the political 

parties shattered and 

destroyed the fortunes of 

key politicians. Let’s start 

with the parties. The Conservative 

party increased 

its seats from 302 in 2010 

to 313 this year to form 

the next government, with 

a majority of 12 seats. Of 

course, that’s a slim majority, 

but it’s enough to govern 

assuming all the Tory 

MPs support their party 

at all times, which is a tall 

order. As for Labour, their 

seats dropped nationally 

from 256 in 2010 to 235 

this year. Labour lost seats 

across the country, but it 

was in Scotland that the 

real wipe-out took place: 

from 41 Scottish MPs in 

2010, Labour now has just 

1! The Lib-Dem suffered a 

terrible blow too: they had 

56 seats in 2010, but now 

have just 8; they also lost 

10 of their 11 MPs from 

Scotland. The biggest beneficiary 

of last week’s election 

rout, however, was 

the SNP. They had just 6 

Westminster MPs in 2010, 

but after almost wiping 

out the other parties from 

Scotland on May 7, they 

now have 56 of Scotland’s 

59 MPs, leaving only 1 MP 

each for Labour, the Tories 

and the Lib-Dem. 

But if you think the 

election was “cruel, merciless 

and crushing” for 

the losing parties, as Nick 

Clegg, the former Lib-Dem 


Britain embraces federalism after an election defined by nationalism 

and prosperity that goes 

with it. I am the first to 

know about the primacy 

of economic policy. But 

beyond that, we can never 

even begin to know what 

to do about the economy 

until we forge that fellowfeeling 

that makes us feel 

we are one people with 

one collective destiny. 

That is the task of nation 

building. 

I believe that the traumas 

the Nigerian people 

have endured in the last 

two decades are partly 

reflective of the crisis of 

nationhood. There was a 

time when Nigerians felt 

they belonged together. 

Something cracked along 

the way. We have become 

a fractious and divided 

people – deeply suspicious 

of one another. The dubious 

federal structure that 

the British left us, in which 

the North overwhelmed 

the other federating units, 

was bound to exacerbate 

ethnic suspicions. The 

military coups deepened 

those suspicions as did 

the gruesome civil war. The 

long years of military tyranny 

did nothing to unite 

our people. The military, 

which had been one of 

the unifying institutions 

across the country, became 

a vehicle of disunity. 

The collapse of the civil 

service also did great harm 

to nation building. Although 

nobody ever owns 

up to the fact, it is a truism 

that there is a subliminal 

feeling among the dominant 

ethnic groups that an 

Igbo man could never be 

trusted with the High Magistracy 

of our republic. The 

nearest person that came 

to it in 1999 was Emeka 

Anyaoku, former Commonwealth 

Secretary- 

General. Unfortunately, 

he himself never wanted 

it. As a consequence, many 

among the remnants of 

Ndigbo have retreated to 

the dubious cocoon of 

Biafra. Oduduwa Republic 

has been a project that has 

been long in the making, 

with its flag, constitution 

and anthem. As for Arewa, 

their Usmaniyya Caliphate 

project has been hatched 

with the sword and with 

blood – much of it against 

the hapless people of the 

Middle Belt. 

I was once asked by 

a distinguished French 

intellectual whether Nigeria 

is a country at all. 

My instinctive reaction 

was annoyance. But then, 

when I thought deeply 

about it, I realised it was a 

very legitimate question. I 

studied in France and have 

drunk deep from the fountain 

of French culture and 

civilisation. The concepts 

of state and nation are 

leader put it, consider the 

decapitations of key politicians. 

As the Financial 

Times put it, it was “the 

most dramatic defenestration 

of UK political leaders 

in memory”. Labour lost its 

shadow chancellor, a truly 

big beast in the party, Ed 

Balls. The party’s shadow 

foreign secretary, Douglas 

Alexander, also lost 

his seat – wait for it – to 

a 20-year-old final year 

politics student at Glasgow 

University, Mhairi 

Black, who is believed to 

be the youngest MP in 

the UK since 1667. Even 

the leader of the Scottish 

Labour party, Jim Murphy, 

lost his seat. On the 

Lib-Dem’s side, it was, 

indeed, a punishing night, 

as all the party’s senior 

ministers in the coalition 

government were wiped 

out. The voters booted out 

no fewer than five Lib- 

Dem ministers, including 

Vince Cable, the Secretary 

of State for Business, who 

once worked for Shell in 

Nigeria. 

Of course, in those circumstances, 

it was untenable 

for the party leaders 

to keep their jobs; they 

had to take responsibility 

for their party’s abysmal 

failure. So, it wasn’t surprising 

that they fell on 

their sword. The Labour 

leader, Ed Miliband, and 

the Lib-Dem leader, Nick 


GLOBAL 

PERSPECTIVES 

OLU FASAN 

Fasan, a London-based lawyer 

and political economist, is a 

Visiting Fellow at the London 

School of Economics. 

o.fasan@lse.ac.uk 

@olu_fasan 

Published by BusinessDAY Media Ltd., The Brook, 6 Point Road, GRA, Apapa, Lagos. Ghana Office: Zion House, Shiashie, OIC-Galaxy Road, East Legon, Accra. 

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