CMYK

MAY 14, 2012

Continues on page 18

CURRENCY BUYING CENTRAL SELLING

CBN Exchange rate as at 11/05/2012

112.11 -0.62

96.27 -0.81

176.75 -1.90

2,308.00 -30.00

20.20 -0.25

CFA 0.2868 0.2968 0.3068

KRONER 26.9473 27.0344 27.1214

EURO 200.3548 201.0022 201.6495

POUNDS 249.3487 250.1544 250.96

RIYAL 41.2623 41.3956 41.5289

SDR 237.8508 238.6193 239.3878

FRANC 166.7565 167.2953 167.8341

DOLLAR 154.75 155.25 155.75

WAUA 237.2707 238.0374 238.804

YEN 1.9356 1.9419 1.9481

RENMINBI 24.5194 24.5991 24.6787

Capital market probe:

I’ve learnt my lesson — Oteh•Admits division in SEC•Probe will strengthen capital market — Operators, Shareholders•SEC Commissioners lied

Following the revelations of theprincipal officers of the Securities

and Exchange Commission (SEC) andthe deluge of questions by the ad hoccommittee of the House ofRepresentatives probing the nearcollapse of the Nigeria capital marketon Wednesday, Director-General of theSEC, Ms. Arunma Oteh, has admittedthat there was division and rancourwithin the rank and file of thecommission, saying that she has learnt

By PETER EGWUATU,MICHAEL EBOH, & NKIRUKANNOROM

her lesson.Also, in reaction to the on-going

probe, stakeholders in the capitalmarket reckoned that the probe is awelcome development and will helpin addressing critical issues that hadcontributed to the near collapse of themarket.

However, Vanguard gathered thatthe SEC commissioners lied aboutsome of the issues that were raised atthe public hearing. Specifically, it wasgathered that the commissionersparticipated in the project 50, whichthey claimed they did not know about.

Meanwhile, in a statement madeavailable to Vanguard, Oteh said,

“The hearing provides very usefullessons that will guide theCommission’s continuing institutionalstrengthening programme. TheCommission wishes to statecategorically that the SEC remains acohesive institution whose activitiesare driven by highly professional andpatriotic staff under the headship of avery experienced management teamand board delivering exceptionalservice to participants in an envisagedworld class Nigerian capital market.”

Continuing, she said: “The SECrecognises the challenges to itsinstitutional cohesion arising from theimplementation of its on-going

transformational programme. TheCommission is fully committed toovercoming those challenges andstrengthening the organisation toposition it to successfully birth a worldclass Nigerian capital market whichis the object and vision of thetransformation project.”

She said: “The SEC is not unlikeother human institutions; thecommission is not immune to commonchallenges arising from cultural andpersonal differences.” She remarkedthat the change project she is leadinghas the final objective of convertingthe SEC to a regulator with the besttools, personnel, systems andprocesses to discharge its regulatoryoversight and market developmentmandate to international best practicestandards.

She stressed that the multi-

*From left: Oxford Business Group Editorial Manager, Rob Withagen, Country Director, Brooke Butler andExecutive Secretary and CEO of the Nigerian Content Development and Monitoring Board (NCDMB), ErnestNwapa

18 — Vanguard, MONDAY, MAY 14, 2012

Cover Story

Developing EntrepreneurialSpirit in Nigeria Part 1

Continues from page 17

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dimensional transformationprocess includes InformationCommunication Technology(ICT) upgrade and migrationto a technologically savvyorganisation with emphasison e-culture; personnelrecruitment at leadership,middle management andentry levels with emphasis ontraining and re-training;streamlining of theinstitution’s value system tomake it more evocative;leading to the charge forconsistent human capacityupgrade throughcollaboration with regulatorsand resource institutions inother jurisdictions and theglobal financial market place.

According to Oteh, atransformation project of thismagnitude has culture shockand cultural lag implicationswhich are sure to createfeelings of apprehension andeven alienation among somemembers of the SEC family.Such feelings, she pursued,“… are short run and mediumterm consequences of farreaching institutional changemanagement.”

She, however, assured thatSEC , having closely followedand actively participated inthe on-going House ofRepresentatives publichearing, had noted the frankdisclosures at the hearing andintends to factor these into thechange management elementof the institutionaltransformation project.

Stakeholders’ reactionsReacting to the on-going

probe, Mr. Bayo Olugbemi,Managing Director, FirstRegistrars, said: “So far, it hasbeen fair. The Committee andthe process are highly ratedby me. Hopefully, dependingon the results which shouldbe fearless and fair, it willaddress some of the issuesthat had hindered growth ofthe market

If the presentations made bySEC and NSE are anythingto go by, there is definitelylight at the end of the tunnel.What they should focus moreon is rebuilding investors’confidence and investors’education, not rhetorics."

Asked if the probe wouldaffect the market positively ornegatively, he answered inthe affirmative, sayinghowever, that it would dependon the truthfulness andfairness of the report and ifultimately therecommendations wereimplemented.

In his own submission, Mr.Johnson Chukwu, ManagingDirector/CEO, Cowry AssetManagement Limited, said,“I think the probe has so far

been objective and fair to allthe parties. The Committeehas largely focused on issuesinstead of personalitiesalthough there is no way suchfact-finding mission cancompletely avoid issuesrelated to personalities thatplayed or are playing criticalroles in the capital marketcrises.”

On the way the committeehas so far conducted itself,Chukwu said: “I think theyshould be commended forremaining focused so far onfinding the causes of theNigerian capital market crashand ways to revive the market.I believe that most Nigerianswho have been followingdevelopments at theCommittee’s sitting wouldrate them to have so farperformed above average.”

He, however, argued thatthe on-going probe will likelynot have any positive effect onthe market, saying that themarket has been inundatedwith negative revelations ofthe workings of theregulators. “What may affectthe market are the finalrecommendations of theCommittee, such as thepracticality of rescue orremedial measures andnature/severity of sanctions tomarket abusers,” heenthused.

For him, there was nothingeither the NSE or SEC woulddo to turn around the marketin the immediate, even as heurged for maximumcooperation among allstakeholders in revampingthe market. “NSE for instancehas already announced anelaborate short, medium andlong-term programme to turnaround the market. Thesemeasures are already beingimplemented. I think thatwhat we need is to supportthe NSE programme withfiscal policy instruments tomake the market moreattractive to investors andquoted companies alike. Suchpolicy measures couldinclude waiver of tax ondividend paid by quotedcompanies, reduction ofcorporate tax for quotedcompanies among others.”

Mr. David Adonri, ChiefExecutive Officer, LambethTrust & Investment CompanyLimited, said, “From generalissues, I expect the probepanel to drill down to thespecific matters that remotelyand directly contributed toformation of the asset bubblethat wrecked the equitiesmarket.

“The roles played by thefinancial regulators,operators, issuers and banksin inflating the asset bubble

should come under intensescrutiny.

“The probe offers a rareopportunity for examinationof the fundamentalweaknesses relating toinability of the capital marketto form capital for the strategicheavy industrial andagricultural sectors of theeconomy.

“The migration of tradingin Federal Government bondsaway from the tradingplatform of the NSE to theunregistered OTC platformneeds to be probed. The actiondenied retail investors analternative investment outletthat would have preventedover concentration of assets inequities.

“It is my hope that the newpanel will avoidsensationalism and dwell onconcrete issues like the roleof fiscal indiscipline incrowding out the equitiesmarket and revival of theequities primary market.”

Also reacting, ChiefTimothy Olufemi, ashareholders' activist, notedthat the current probe panelis okay and is seen to beperforming according to theexpected standard.

He stated that it wasparticularly commendablethat the Ad hoc Committeehas been able to uncover a lotof malfeasance in theSecurities and ExchangeCommission by the way it wasbeing conducted.

Olufemi believes that theon-going probe has taken aturn for better, saying that itwould definitely affect thefortune of the market if therecommendations by thevarious stakeholders thathave appeared before thecommittee wereimplemented.

For him, the revelation madeabout the way the SEC D-G, Ms. Arunmah Oteh,has been runn ing thecommission was a pointerto the fact that she doesnot possess the qualitiesthat would elicit successand ultimate turn aroundin the market.

He said: “We, theshareholders have beencomplaining right from thetime she assumed office thatshe is not capable ofmanaging an institutionlike SEC. A situation whereshe runs the commissionlike one man show is notgood for the market. Thingsare not done that way. Shehas officers who have spentover 30 years working forSEC and yet, she does notlisten to them."

I’ve learnt my lesson — Oteh

A recent collection of essays on entrepreneurialinnovation in develop-

ing economies, titled ‘Lessonsfrom the Poor’, mentions anaspect of Nigerian clothingdesign. Examining the tradi-tional adire dye industry, au-thor Thompson Ayodele in-forms that the bottom 19% ofentrepreneurs polled for thestudy earned more than stateand federal civil servants. Forthe purpose of this essay, thestory is significant in moreways than one. First, it is aclassic instance of entrepre-neurial spirit, describing thetransformation of an estab-lished Yoruba craft into a ven-ture for wealth creation andemployment generation. Sec-ond, and perhaps only in be-tween lines, it reflects a mea-sure of the serious imbalanc-es that plague Nigeria’seconomy. Africa’s second largesteconomy is a bundle of ex-treme contradictions; with bil-lions of dollars in annual oilrevenue on one end and per-vasive poverty for most of its148 million people on the oth-er. Relative political stabilitysince 1999 has deliveredsome reform and regulatoryinitiatives to correct huge andlong-standing macroeconomicdisparities, yet the countryremains overwhelmed by per-sistently dismal indicatorsand human development in-dices. Nigeria’s current percapita GDP of $1,371.31 ranksit below much smaller Africaneconomies like Sudan, Con-go and Swaziland. The latestUNDP poverty survey of 108developing nations placed thecountry at the 80th position,below Rwanda and Malawi.Achieving the UN Millenni-um Development Goals andits own, and more ambitious2020 target require a para-digm shift in mindset and pri-orities. It also requires thesuccessful engendering of abroad, pan-Nigerian entre-preneurial spirit!A slew of relevant policy re-directions have already beeninitiated in this regard: Thegovernment has deregulatedoil prices, disinvested publicsector undertakings, createdspecial economic zones andpassed assorted legislation toencourage enterprise devel-opment. While some of thesemeasures are starting to showpositive results, many havebeen largely ineffective whileyet others have completelycollapsed. For instance, amassive privatisation drivelaunched after 1999 managedto rake up private sector in-vestment. However, Abuja’s

simultaneous inclination formicro-enterprises, instead ofsmall-scale ventures, did lit-tle to curb unemployment.The failure or even inade-quate success of these mea-sures is attributed primarily todisregard or ignorance ofground realities, and lack ofa coherent, consistent, mac-ro-level vision. Nigeria’s unique set ofproblems calls for broad-basedpolicy intervention from thebottom up, and any individu-al law or policy that is not partof a unified effort is unlikelyto make much difference. The‘bottom up’ analogy is perti-nent, as one of the first thingsNigeria ought to be doing isimproving the condition of itsroads.The business environment inthe whole of Africa is crippledwith massive infrastructureshortfalls that result in thecontinent’s high enterprise

mortality rate. Significantly,the rate of failure affects old-er and new entrants alike. Aleading cause is almost al-ways infrastructure deficitsthat critically hamper genuineeconomic growth and produc-tivity.Since 2008 the governmenthas began to show the politi-cal will to implement the mar-ket-oriented reforms urged bythe IMF such as modernizingthe banking system, curbinginflation by blocking exces-sive wage demands, and re-solving regional dispute overthe distribution of earningsfrom the oil industry. GOProse strongly in 2007-10 be-cause of increased in oil ex-ports and high global crudeoil prices.Nigeria likewise suffers fromendemic infrastructural woeswith regards to roads, com-munication and especiallypower (small and large busi-nesses alike across the coun-try rely heavily, and at timesexclusively, on backup elec-tricity). There have been noworthwhile attempts so far toradically upgrade the powersector, or attract private in-vestment.

N i g e r i a ’ sunique set ofproblems callsfor broad-basedpolicy interven-tion from thebottom up

Vanguard, MONDAY, MAY 14, 2012 — 19

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,

The bill before the National Assembly to amend the CBN Act is particularlyinteresting. It seems the lawmakers are bent on castrating the apex bankfor what they perceived as an overbearing leadership of the bank. Why

have the lawmakers suddenly realised that the CBN Act needs amendment?Last year, the members of the National Assembly and the CBN Governor were

Bill to castrate CBN:

In whose interest?

engaged in debate of theburden of overhead cost themembers imposed on thenation. The members seem tonow want to take a revenge onthe bank. What the honourablemembers should realise is thatcentral banking in developingcountries is saddled withresponsibility that makes themvery key to the functioning ofan economy.The Central Bank of Nigeria(CBN), like most others, hasthe core mandate ofmaintaining price stabilityand ensuring a non-inflationary growth. TheCentral Bank is also aregulator, banking supervisorand development bank. It hasthe responsibility to ensure asound and stable financialsystem in addition to otherdevelopmental functions.These mandates and functionsare peculiar to central banksin developing economies, andno other institution performssuch functions. These specialresponsibilities are enormousand have continued to poseincreasing challenges tocentral banks, largely becausedevelopments in the domesticand international economiescreate intricacies andcomplexities in the financialsystems and the art of centralbanking. Indeed, the currenttrend of globalisationexemplified by economic andmonetary unions, hasincreased the challenges ofcentral banking.The effective discharge ofthese responsibilities requiresthat central banks beindependent in the true senseof it; that is, shielded frompolitical interferences; haveadministrative independenceand instrument autonomy. Thenew bill before the NationalAssembly is seeking to have achairman of the board of theCBN outside the institution. Ifthe National Assembly beforepassing the bill ensures thatthose to be appointed to suchan office are individuals withimpeccable character and arethose with vast knowledge ofthe economy and areapolitical, all well and good.If the law is to curtail what thehouse sees as the excesses ofthe current governor, it will bedangerous for the economy tohave a political appointee ashead of the apex bank. Suchpolitical appointee will nothave the know-how needed tomanage an economy. Likemost other institutions ofgovernment in Nigeria, theirbudgets are passed but howfar have they utilised suchresources in the over allinterest of fellow Nigerians?Why is the National Assembly

just realizing the need for theCBN to submit its budget forappropriation? If the currentGovernor is the problem, heis holding a tenuredappointment. He will finishhis term and move on. TheCBN as an institution willremain.Making the Governor of thecentral bank subservient to apolitically-appointed BoardChairman as well as excludingdeputy governors who areexecutive directors as boardmembers will make matterworse and may not be in thebest interest of Nigeria. Justas it is undesirable to have apolitically controlled CentralBank, the board of Governorsof the CBN must also learn tocomport themselves andcontrol their public utterancesand actions in the interest ofthe economy. No seriousnation will accept a flippantCBN Governor. The globalbest practice for an efficientand effective central bankingis a truly independent centralbank with both operationaland financial independence.Financial independenceinvolves four aspects, namely:the right to determine its ownbudget; the application ofcentral bank-specificaccounting rules, clearprovisions on the distributionof profits and clearly definedfinancial liability forsupervisory authorities.Are members of the NationalAssembly aware of thepossible economicconsequences of the CBNbudget being tied down formonths when the bank neededto intervene in the economy?Given Nigeria’s recentexperience with the approvalprocess of the FederalGovernment budget and theeventual passage of theAppropriation Bill by theNational Assembly, it would bedisastrous for the CBN interms of its operations andoverall performance, if itsannual budget gets boggeddown with the usual delaysthat had attended the FederalGovernment budget. Theunique responsibilities thathave been bestowed on thebank require it to actexpeditiously should the needarise, without recourse to thepolitical authorities.

Politicians all over the worldappear to have come toappreciate these issues anddecided to remove thetemptation to pursue short-term gains and make theircentral banks independent.Have these honourablemembers looked at theevolution of the operations ofthe Central Bank over theyears? Are planning for an IdiAmin kind of central Bankwhere politicians will orderthe apex bank to print thenaira as once advocated byBarrister Jimoh Ibrahim? TheCentral Bank of Nigeria hashad a chequered history ofautonomy since its inceptionin 1958, varying betweenautonomy and control. In the1958 Act, the CBN wasgranted a measure ofautonomy, which was

gradually eroded until 1991when the autonomy wasrestored. The erosion of thebank’s autonomy between theyears coincided with militaryinterventions in politics inNigeria. Again, the autonomywas gradually eroded until1999 when administrative andinstrument autonomy wasgranted to the bank to shieldit from political pressures inthe implementation of policy.From the inception of the bank,the administrative structurehas been that the Governor ofthe CBN presided over theBoard of Directors andExecutive Directors or DeputyGovernors had always been onthe Board. This arrangementhad ensured easier, smootherand faster implementation ofmonetary and financialpolicies.

The Central Bank of Nigeriarequires full independence inthe true sense of it to enable itact appropriately according toits expert and independentviewpoint. The global trendshave been towards fullindependence for centralbanks. Indeed, budgetary andinstrument autonomy are thereasons why most centralbanks are now proactive ratherthan reactive in the dischargeof their responsibilities –central banks are able toanticipate and identifyproblems and unintendedoutcomes and respondimmediately with appropriatepolicy actions. This is the trendall over the world – in bothdeveloped and developingcountries. The NationalAssembly should not becauseof the present holder of the

office of the Governor of theapex bank hamstring theinstitution. It will not help thenation. The bill must besubjected to public hearing,expert scrutiny and should bein the best and long- terminterest of Nigeria. If thecurrent CBN managementhas over-stepped its bounds,it is because the President isnot interested in what thebank does. When theimmediate past Governor ofthe CBN, ProfessorChukwuma Soludo, came withthe strategic agenda for thenaira and the plannedredenomination of thecurrency, the then PresidentAlhaji Umaru Yar Adua onwhose table the buck stopped,simply told him no, the policywas suspended till date. ThePresident has not complained,so let the CBN be.

BRIEFS

Algeria owed $250mln bySwitzerland’sPetroplus

Insolvent Swiss oil refinerPetroplus owes Algerian

state energy firm Sonatrachover 250 million dollars inunpaid bills, an Algerianenergy sector official told theMedia. Sonatrach has notreceived payment for severalcargoes of crude it deliveredto the refiner, the source said,without specifying whataction, if any, the Algerian firmplanned to take to recover themoney. Late last year,Petroplus said lenders hadfrozen a credit facility whichit was using to buy crude fordelivery to its refineries. Itfiled for insolvency protectionin January. A lawyer whosefirm has been appointed asliquidator for Petroplusentities in Switzerlanddeclined to comment on anyunsettled bills with Sonatrach.“We cannot give any answersconcerning claims andwhether they will be acceptedor not,” said Karl Wuethrichfrom law firm Wenger Plattner.Petroplus has been divestingassets since it becameinsolvent.

Ibom PowerPlant resumesoperation

The 190 megawatt IbomPower plant

being promoted by the AkwaIbom government last weekbegan operation. Mr OffiongItabong, the Public AffairsOfficer at Eket Business Unitof the Power HoldingCompany of Nigeria (PHCN)confirmed the development inEket.

It was gathered that theindependent power plant,located in Ikot Abasi, brokedown last month and resultedto prolonged power outage.The outage has beenimpacting negativelyon economic activities inparts of the state. The plantresumed operation followingthe replacement of a faultycomponent in the facility.“Ibom power plant hasresumed generation and thesupply of power in the 12 localgovernments within EketBusiness Unit has improved.When the plant broke down,we were compelled to domassive load sheddingbecause we were receiving apaltry five out of the required40 megawatts from thenational grid”.

If the law is to curtail what thehouse sees as the excesses of the

current governor, it will bedangerous for the economy to

have a political appointee as headof the apex bank; such political

appointee will not have the know-how needed to manage an

economy

20 — Vanguard, MONDAY, MAY 14, 2012

News

BRIEFS

The 42 oil marketerslicensed to import fuel

for the second quarter of the year have begun importationof the product, an official ofthe Petroleum ProductsPricing Regulatory Agency(PPPRA) said. The official,who pleaded anonymity, toldthe News Agency of Nigeria(NAN) in Abuja on Thursdaythat the marketers, who wereissued licences in March,had started importingproducts to avoid scarcity.

“The marketers havestarted importing fuel for thesecond quarter and this willensure there is no scarcity ofthe product in the country,”he said. NAN recalls that 42oil marketers were grantedlicence in March by the

By FRANKLIN ALLI,NAOMI UZOR &OLAYEMI FOFAH

Nigeria Association ofChambers of

Commerce, Industry, Minesand Agriculture (NACCIMA)has called on the CentralBank of Nigeria (CBN) andSecurity and ExchangeCommission (SEC) toestablish an UnclaimedDividend Trust Fund as ameans to address theproblem of unclaimeddividends which presentlyestimated at N52.2 billion.

Briefing the press on thestate of the economy in Lagos,the Association also called onthe Federal Government tomake illegal refineries tobecome legal instead ofdestroying them.

“The establishment of anUnclaimed Dividend TrustFund with appropriate legallaw to cure the present defectsby making it possible forshareholders to recover theirdividends however long thismay take. This will make itmandatory for companies tohand over unclaimeddividends to SEC for onwardtransfer into the Fund,” saidNACCIMA President, Dr.Ademola Ajayi.

“Unclaimed dividends inthe Nigerian capital marketnow stands at N52.2 billionas at December 31, 2011. Weare worried that the risingwave of unclaimed dividendsin the nation’s capital marketmay become another thornyissue that seems to havedefied all solutions despitethe aggressive drive by theregulators to ensure thatdividends payout bycompanies are received byinvestors promptly.

The apex bank, he said,should therefore prevail onbanks in the country to acceptpayment of dividend warrantinto savings accounts.

“The refusal of banks toallow investors to pay theirdividend warrants intosavings account (mostlyoperated by low incomeinvestors) is partlyresponsible for the growingincidence of unclaimeddividends in the country.

“Presently, Nigerians arenot properly educated onwhat happens to theirunclaimed dividends whileaccounts of failed banks withunclaimed dividends are alsonot known. To compoundthis problem, most dividend

NACCIMA tasks CBN, SEC on N52.2bnunclaimed dividends•asks FG to legalise illegal refineries

warrants received byNigerians (i.e. shareholders)get to them after it has beenstalled, making ituncollectable. The D-G, SEC has attributed the reason forthe accumulation ofunclaimed dividends toignorance or whenshareholders change theirforwarding addresses withoutinforming the companies’registrars thus, failing toreceive the dividendwarrants. While weappreciate SEC’s efforts atensuring reduction in theamount of unclaimeddividends, we believe thatother major factorsresponsible for unclaimeddividends includedshareholders who diedintestate and withoutinformation on next of kin,

multiple applications byapplicants during theinvestment process, deliberateactions to deny investors theirbenefit through variousunethical schemes by someregistrars and companies wholack liquidity to pay and lossof dividend warrantsfollowing poor postal system.

“To put an end to thisunclaimed dividend“palaver”, we canvass asfollows:

SEC should intensify effortsat sensitization of the publicand corporate organisationson the need to provide currentpostal addresses and makeprompt payment of dividendsto shareholders; Shareholdersshould be encouraged tosubscribe to or embrace the e-dividend payment solution,which all the registrars ofcompanies have put in place.

Regarding illegal refineries,he said: “NACCIMA believes

if these illegal refineries aremade legal and is effectivelydone, it would boost localsupply capacity of petroleumproducts, create jobs andinvariably may also reduceprices when competition fullytakes its course.

“We have watched withdismay the continuousdestruction of small refineriesclassified by Government asillegal in the country. Webelieve that the action ofGovernment/Ministry ofPetroleum Resource is not thebest given the currentproblem confronting thecountry in the petroleumsector; as it would furthercompound the sector’s supplychain of petroleum products.To ensure strict complianceand standards with the laiddown criteria by the operatorsof the small (but now legal)refineries, there is need forthe Department of PetroleumResource (DPR) to assumeeffective supervisory role,” hesaid.

Oil marketers begin importation for second quarter — Official

PPPRA to import 4.8 billionlitres of petrol for the secondquarter of the year. The officialsaid the agency had putstringent measures in placethat would ensure thatmarketers were transparentand followed due process inthe importation.

He said one of the measureswas reinforcing theindependent inspectors at theports and ensuring that allimports were accompaniedwith letters of credit. Theofficial said holders of thepermit would also be requiredto furnish PPPRAwith dailyrecords of products loading,evacuation from designateddepots for accountability andeffective supply. He warned

that it was nolonger business as usual asthe agency was ready tosanction any marketer who failed to deliver theapproved volume of product.

He added that the agencywould soon hold its quarterlymeeting with marketers andother stakeholders in thesector to fine-tune any greyareas. “We will soon hold ourquarterly meeting to fine-tune all these details. I willbe able to give you details ofthe process after themeeting,” the official said. Heexpressed optimism that allthe measures would ensurebetter accountability andtransparency in theimportation process.

*From left: Mr. Robert Rodden, keynote speaker; Mr. Osita Chidoka, Corp Marshall, FederalRoad Safety Corps, FRSC; Mr. Frank Aigbogun, Publisher, Business Day and Eng. Chidi Izuwahat the 2012 Road Infrastructure Conference themed: Exploring Cement-based option forSustainable Road Construction in Nigeria, held in Lagos. Photo by Lamidi Bamidele

Wal-Martfocused onexisting Africamarkets

Wal-Mart Stores Inc, isfocused on

strengthening its existingoperations in Africa and notimmediate expansion intonew markets on the continent,the head of its internationalbusinesses said on Thursday.Wal-Mart, the world’s biggestretailer, last year spent $2.4billion on a majority stake inSouth Africa’s Massmart, adiscounter with a growingpresence on the continent.

“Massmart is currentlylocated in 12 markets so that’sour focus. Building ourbusiness in the markets thatwe are currently in is ourprimary focus,” DougMcMillon told Reuters.

Dangote eyesLondon listingby Q3 2013

Nigerian billionaireAliko Dangote said on

Thursday he was aiming tolist his $11 billion cementcompany on the London StockExchange by the third quarterof 2013. “If the market is goodby next year, we will hit themarket, sometime. Maybethird quarter ... we will try,”he said on the sidelines of theWorld Economic Forum inAddis Ababa.

Swiss firmsuspended byNigeria over fuel

Swiss-based oil firmNimex Petroleum has

been suspended by Nigeria’sfuel regulator for failing toprovide documents forshipments, the company saidon Wednesday, a move thatsuggests the West Africancountry may be taking stepsto clamp down on subsidygraft estimated to have cost itbillions of dollars. Thegovernment department isone of several under fire foroverseeing a scheme thatpaid out large sums infraudulent subsidy claims forfuel that did not exist or wassold abroad. Nigeria’s corruptfuel subsidy scheme cost thecountry $6.8 billion between2009-2011, according to aparliamentary probe thatfound damning evidenceagainst the fuel regulator, thePetroleum Products PricingRegulatory Agency (PPPRA).Nimex Petroleum confirmedPPPRA had suspended itsactivities in Nigeria in a letterdated May 3 over missingdocumentation relating to thedelivery of two shipments of

Vanguard, MONDAY, MAY 14, 2012 — 21

News

BRIEFS

*From right: Vice-President Namadi Sambo; Power Minister, Porf. Barth Nnaji; PermanentSecretary, National Planning Commission, Dr. Kabir Usman and the Minister of State, Fi-nance, Dr. Yerima Ngama during the National Economic Council meeting at the State House,Abuja. Photo by Abayomi Adeshida

The Federal Governmenthas commenced moves to

position the Small andMedium Enterprise sub-sector in Nigeria as growthdrivers of the economy.

The Minister of Trade andInvestment, Mr. OlusegunAganga, who disclosed thison Thursday, said, with thismove, SMEs in Nigeria wouldsoon become vibrant enoughto drive the required level ofgrowth in the economy.

He spoke while briefingjournalists on the sidelines ofthe World Economic Forummeetings in Addis Ababa,Ethiopia.

Aganga said in the last oneyear of the PresidentGoodluck Jonathanadministration, the results ofnew SME policies andschemes, in terms of jobcreation, had shown that ifgiven the necessary support,SMEs would provide thefoundation for sustainablegrowth and povertyalleviation in Nigeria.

He, therefore, said that thepriority currently, for theMinistry of Trade andInvestment was the SMEsector, noting that theministry had put plans inplace to remove the majorbarriers to SME growth(access to affordable finance,low level of business supportand high cost of operation) toboost the development of thesub-sector.

The minister said acommittee comprising experts

FG moves to position SMEsas growth drivers

•Creates vehicles for tackling growth barriers

in the different fields relatingto the major bottlenecks in thesector was already being setup to ensure that the countryachieved a turnaround beforethe end of this administration,adding that vehicles hadalready been created toachieve this goal.

“Micro, Small and MediumEnterprises remain thebackbone of the developmentof any economy and thedriving force of nationalgrowth. In Nigeria, there arecurrently over 17 millionMicro, Small and Medium

Enterprises in the country,employing over 31 millionNigerians. They account forover 80 per cent of the totalnumber of enterprises inNigeria and employ 75 percent of the total workforce,”Aganga said.

“But their contribution to thenation’s GDP is still relativelylow, due to major constraintsin the operating environment,which have limited theirabilities to create jobs andperform the vital role ofenhancing economic growthand development,” he added,noting that in the next threeyears, Nigerians shouldexpect more SMEs withenhanced productivity.

He said, already, a national

database had been developedin partnership with theNational Bureau of Statistics,which was the first step in theeffective tackling of theproblems of the sector.

According to him, there willalso be a national SME Policythat will address the majorproblems in the sector.

He said the Bank ofIndustry was alreadyexecuting matchingprogrammes with stategovernments on SMEs anddeepening financingpenetration, usingmicrofinance banks.

The minister said hisministry had also begunregular interaction with SMEdesks of banks to developunconventional but workablemeans of providing affordablefinance for SME growth.

He said: “For instance, wehave started getting roundcollateral issues related withfunding through cross-guarantees by members ofcooperatives and setting upspecial intervention funds forcritical sectors such as textiles.

“We are implementing theOne Local Government OneProduct initiative to open upthe rural areas for industrialdevelopment, employmentgeneration and wealthcreation; and we arepartnering the LagosBusiness School to developBusiness Support Services.”

Other efforts, he said,included developing smallhydropower plants instrategic areas where theycould serve SMEs; creatingfinancial inclusion by settingaside special fundingschemes for women andmechanics; and establishingintegrated industrial parks toenhance the productivity andprofitability of SMEs; amongothers.

BY PROVIDENCE OBUH

The Nigerian ContentDevelopment and

Monitoring Board (NCDMB)has expressed concern overthe decaying pipelinenetwork in the country andhas proposed its renewal inthe coming five years (2017).

Executive Secretary/CEO ofthe Board, Mr. Ernest Nwapa,who stated this during ameeting with the OxfordBusiness Group (OBG), aglobal publishing, researchand consultancy firm, said“Nigeria’s 5000-km pipelinenetwork is largely dilapidatedand in need of renewal in thenext five years, adding that

NCDMB expresses worry over decaying pipeline network

… Seeks renewal by 2017

the gas plan will createdemand for another 2000kmof pipeline.

“We are activelyencouraging the expansion ofexisting pipe-mill capacity aswell as attracting Greenfieldinvestments.”

He revealed that boostingpipe-mill capacity was one ofthe NCDMB’s priorities forincreasing the oil and gasindustry’s contribution toeconomic growth.

He told the group thatNigeria is planning to set upits own pipeline industry toboost domestic employment aswell as to enhance GDP.

“The Board is alsospearheading the country’sbid to bring more of the local

population into the industryand build domestic capacity inline with the terms of theNigerian Content Act (NCA),which became law in 2010.

“I believe it is high timeNigeria build its own drydock, given the recentincrease in the country’s fleet,coupled with growingdemand around the world forshipyard space.

“Vessel ownership isincreasingly in Nigerianhands, both through NigeriaLiquefied Natural Gas’s fleetand the Vessel ReplacementStrategy, providing the criticalbase for the establishment oflocal assembly, maintenanceand repair activities. It wouldalso feed into the globaldemand for dry-dock space,which suffers from frequentshortages.”

Conoco CEOconfirms sale ofNigeria assets

Ryan Lance, the new hiefexecutive officer of

ConocoPhillips, onWednesday confirmed thatthe U.S. exploration andproduction company plans tosell its Nigerian assets, butsaid a deal was not imminent.“We’re testing the market onour Nigerian assets,” Lancetold reporters after thecompany’s annual meeting.

Those assets including on-shore, off-shore oil and gasfields and a stake in its LNGBrass facility, sources familiarwith the situation told Reuterson Tuesday. The assets wereexpected to attract interestfrom Nigerian companiessuch as Conoil and Oando,and Asian players includingChina’s Sinopec, Indiancompany ONGC, and SouthKorea’s KNOC, Reuterssources said. They could helpConocoPhillips raise about$2.5 billion and possibly moreif they were sold separately,which is the most likely route,according to the sources.

Greek Cokebottler Q1 netloss widens,misses fcast

Coca-Cola Hellenic(CCH) , the world’s

second-largest bottler ofCoca-Cola Co. soft drinks,posted a wider than expectedloss in the first quarter, hurtby austerity in debt-ladenGreece and highercommodity costs. The Athens-based company, withoperations in 27 countries inEurope and in Nigeria, saidon Thursday comparable netloss came in at 19 millioneuros ($24.6 million), higherthan analysts’ average 14.2million euros forecast in aReuters poll. The bottler saidthe volume of unit cases solddropped by 2 percent year-on-year to 425 million. “Wecontinue to witnessmacroeconomic uncertainty inall of our EU markets,” thecompany’s chief executiveDimitris Lois said in astatement. “We are also facingpersistent input costpressures, whose year-on-year growth peaked in thefirst quarter,” he added. Onthe other hand, the companysaid it maintained orincreased its market volumeshare in sparkling beveragesin most of its markets,including Italy, Switzerland,Russia and Ukraine. Thecompany reiterated itsintention to invest 1.45 billioneuros in 2012-2014. It expectsto generate the same amountin free cash flow.

22 — Vanguard, MONDAY, MAY 14, 2012

Money Market

BRIEFS

CIBN holds AGM,elects new officeholders

The Chartered Institute ofBankers of Nigeria

(CIBN) will this weekendhold its Annual GeneralMeeting (AGM) and electionof new Office Holders whowill run the affairs of theInstitute for a period of twoyears.

Mr. ‘Laoye Jaiyeola, FCIB,President/Chairman ofCouncil, of the Institute willpreside over the AnnualGeneral Meeting.

In line with the Institute’stradition, Chairmen and ChiefExecutives of banks, PastPresidents of the Institute,Presidents of otherprofessional bodies, topGovernment functionaries,Fellows, Honourary SeniorMembers, Associates andother relevant stakeholdershave been invited to attendthe meeting and exercise theirfranchise to elect new officers.

AfDB launchesOxford Companionto the Economicsof Africa

The African DevelopmentBank (AfDB) has

launched the OxfordCompanion to the Economicsof Africa. The Compediumwas unveiled at a seminartitled “Avoiding the FragilityTrap in Africa” held in Tunisand hosted by the AfDB’sChief Economist and VicePresident, Mthuli Ncube. Thekeynote speaker was ShantaDeverajan, Chief Economistof the World Bank’s Africaregion.

The Oxford Companion tothe Economics on Africa, withmore than 100 entries fromleading economic analysts istestament to the fact thateconomic analysis plays acentral role in helping Africanpolicy-makers assess themany trade-offs amonginterventions, and toformulate and implementpolicies for Africa growth anddevelopment. Thecompendium presents variousperspectives, includingcountry case studies. Bydoing this, it rejects the “onesize fits all” approach that hassometimes been applied toAfrican development.

Mr Ncube recognized thecontribution made in thiscompendium by severaleconomists from the AfDB.These included countryperspectives across an arrayof issues including corporate

L-R: Mr. Bob Nwojo, Head, eChannels Services, First Bank; Mr. Wale Williams, Manager, e-Business Support, GTBank; Mr. Mike Ogbalu, Head, Cards and e-Product, Ecobank; Mr. ChuksIku, Group Head, e-Channels, Skye Bank and Mr. Gbenga Osofisan, Cards, Mobile & InternetBanking, First Bank displaying awards for outstanding achievement as recognized by ACIWorldwide recently.

ICAN reiterates zero tolerancefor professional malpractice

BY PROVIDENCE OBUH

Institute of Chartered

Accountants ofNigeria (ICAN) has

reiterated its zero tolerancestance for professionalmalpractice by any of itsmembers.

“Let me seize thisopportunity to stress also thatthe Institute will not condoneany professionalmisdemeanour on the part ofany Chartered Accountantirrespective of how highly orlowly placed in theProfession or Society. Sincewe do not have any sacredcow, the machinery of theInstitutes Disciplinaryprocesses would be broughtto bear on all such deviantcases”, said ProfessorFrancis Ojaide, President ofthe Institute.

Speaking at the49

thInduction ceremony of

the institute in Lagos, Ojaideblamed prevalence ofcorruption for the slow paceof development in thecountry.

He said, “It is theprevalence of corruption andsharp practices in low andhigh places in the nation thathas accounted for the slowpace of development of thisrichly endowed nation andthis is exacerbated by theabsence of transparency andaccountability.

“The recent incidents in ourbanking sector have again re-echoed the need fortransparency in our corporateactivities. Professionalsacross a wide spectrum ofprofessions havedemonstrated indiscretion intheir application ofregulatory and ethicalstandards and within theaccountancy profession; thereis concern of inconsistenciesand failure to comply withaccounting and otherregulatory requirements.”

”There is a directrelationship between anation’s value system and ·itslevel of economic growth anddevelopment and this callsfor soul searching among thecitizens and in particular,among CharteredAccountants whose mainstrengths are integrity andcredibility. We must hold dearto these virtues on which oursurvival depends.”

He enjoined the newentrants into the profession,to strive at all times tofaithfully adhere to the idealsof integrity, transparency andaccountability, which have

influenced the developmentof the Accountancy Professionglobally and of the Institute.

“Indeed, these ideals mustnot be compromised for anyreason, whether monetary ornon-monetary. Any deviationfrom this path will demean notonly the hard-earnedreputation of our Institute butwould also bring the globalAccountancy Profession intodisrepute.

“Thus, as young CharteredAccountants, you are ourambassadors ofprofessionalism to the

business world and to thepublic service. Since,whatever you do or fail to dohave pervasive implicationsfor the image and reputationof both the profession and ourInstitute. It therefore, behoveson you to conduct yourself, atall times, in a manner that willdemonstrate yourunequivocal commitment tothe ideals of integrity,transparency· andprofessional excellence.

The President reiteratedthe need for CharteredAccountants to be proficient in

the use of InformationTechnology (IT), as this willsignificantly impact theirability to render excellenttechnical services to theirdiverse clientele. “As you areaware, the world of globalcommerce is now profoundlydriven by informationtechnology. Any professionalwho is not “IT-compliant” willcertainly be left out of thescheme of things. It is in aneffort to avoid this, that theCouncil introduced theTechnology CompetenceInitiative (TCI).”

He said, “It might interestyou to know that the CentralBank of Nigeria issued apolicy to the effect that onlyIT-proficient CharteredAccountants will be permittedto audit the financial

BY MICHAEL EBOH

Deputy Governor, CentralBank of Nigeria, Mr.

Tunde Lemo, has called for anincrease in Private- PublicPartnership, PPP, saying thiswill help fast track thecountry ’s economicdevelopment.

Speaking at thecommissioning of a N60million ultra-modern clinicdonated by his foundation,Tunde Lemo Foundation, tothe Nigerian Red Cross inAbeokuta, Ogun State, Lemosaid Nigerians should notexpect government to doeverything in terms of drivingthe growth and developmentof the country.

He stated that Private-Public Partnership, PPP, isneeded to achieve the muchdesired rapid economicgrowth.

On the donation to theNigerian Red Cross, Lemosaid the health facility is one

CBN Deputy Governor advocates increase in PPP

way of assisting humanity,stressing that it would go along way to meeting thehealth needs of the people inthe vicinity and environs.

He explained that the fundwas provided by friends of theFoundation, stating that TLFhas also acquired five acresof land in the state to constructa project for youthempowerment.

“It is time to look back andthink of how to bequeath tothe next generation a bettersociety than we met it. Peopleshould go back to the villages,the schools they attended andrebuild. We should not leaveeverything for thegovernment,” he said.

In his address, the NationalVice President, Nigerian RedCross, Deacon T.O. Oladelelauded the initiative of theFoundation, stating that thefacility would be put in gooduse.

He commended thephilanthropic nature of theFounder of the Foundation for

responding to their call forpublic spirited individuals toassist with health facility,noting that Tunde LemoFoundation Red Cross Clinicis the first to be commissionedin the country.

Speakers at the eventincluding Ogun StateGovernor, Ibikunle Amosunwho was represented byCommissioner of Health,Olaokun Soyinka, theNational President, NigerianRed Cross and Governor ofImo State, Mr. RochasOkorocha who wasrepresented by the StateHealth Commissioner, Dr. ObiNjoku, includingrepresentative of formerPresident, OlusegunObasanjo and traditionalrulers lauded the donor,urging other public spiritedindividuals to emulate thegestures.

Highpoint of the event wasthe decoration of Lemo as anAmbassador of the NigerianRed Cross.

Vanguard, MONDAY, MAY 14, 2012 — 23

24 — Vanguard, MONDAY, MAY 14, 2012

CMYK

Money Market

BRIEFS

The Federal InlandRevenue Service (FIRS)

has arrested top officials ofSweet Sensation, UTC andPivotal Engineering in Lagosfor alleged failure to remittaxes totally N2.17 billion.

The arrest were madeduring an enforcement driveled by an Assistant Directorof Legal and ProsecutionDepartment of the Service,Mr. Abu Stephen,

Speaking to journalists,Stephen said that theenforcement drive aimed atrecovering arrears of taxesaccruing to government fromCompany Income Tax (CIT),Education Tax (EDT),Withholding Tax (WHT) andValue Added Tax (VAT).

He said prior to theexercise, the Service hadserved series of notice on thecompanies, including four

Spain unveilsnew bankreforms

The Spanish governmentunveiled a new reform

package for its troubled bankson Friday in a desperate bidto convince investors that thesector is solvent and thecountry has a strategy to avoidthe bailout fate of Greece,Ireland and Portugal.

Economy Minister Luis deGuindos announced thatbanks will be forced to setaside a new •30 billion ($39billion Cdn) financial cushionagainst bad loans and toseparate property assets fromtheir balance sheets.

The package is the secondby the new conservativegovernment in three monthsand Spain’s fourth in threeyears.

Banks preparefor the return ofthe Greek’sdrachma

Banks are quietlyreadying themselves to

start trading a new Greekcurrency. Some banks nevererased the drachma from theirsystems after Greece adoptedthe euro more than a decadeago and would be ready at theflick of a switch if its debtproblems forced it to bringback national banknotes andcoins.

From the end of the SovietUnion - which spawnedcurrencies such as theEstonian Kroon and theKazakh Tenge - to theintroduction of the euro, theyhave had plenty of practice inpreparing their systems tocope with change.

Planning behind the sceneshas been underway sinceEurope’s debt crisis eruptedin Greece in 2009, said U.S.-based Hartmut Grossman ofICS Risk Advisors who workswith Wall Street banks.

“A lot of the firms,particularly in Europe andalso here, have been lookingat that for a long time,” saidGrossman, who added that thelatest Greek political crisishad brought matters “to a littlebit of a head”.

“But there really has beencontingency planning at all ofthe financial institutions forthat to happen ... Greeceleaving the euro zone is nota new idea,” he said.

The EU says it wants Greeceto stay in the commoncurrency, and opinion polls

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

8th of

Jan

15th of

Jan

22nd

of Jan

29th of

Jan

5th of

Feb

12th of

Feb

19th of

Feb

26th of

Feb

4th of

Mar

Point of sale (PoS) terminals deployed by banks

source: nibss

Africa economy should become atransformation economy —AfDBBy BABAJIDE

KOMOLAFE

“The African economywhich largely depends on theexploitation of naturalresources should move on tobecome a transformationeconomy”, said DonaldKaberuka, President AfricaDevelopment Bank.

Speaking at on the first dayof the World Economic Forumon Africa taking place inAddis Ababa, Kaberu said,“From now on, the presidentnoted, the continent shouldmanage its natural resourcesbetter so as to create morewealth, attract investment,and generate employment,particularly by takingadvantage of the currentsalary increases taking placein Asia, and also expand itseconomic growth base tobenefit the poorer sections ofthe society.

During the press conferencejointly hosted by the Co-Chairmen of the Forum,President Kaberuka recalledthat Africa has recorded anaverage economic growth rateof about 6 percent which putsthe continent in second placeafter Asia. He indicated,however, that this level ofperformance has still notprotected Africa from theglobal crisis as the continentis not as resilient as it was in2008 in resisting external

shocks. President Kaberuka and

former British Prime MinisterGordon Brown proceeded toopen the high-level meetingon education and technologyin the presence of numerousAfrican ministers of educationand representatives from theprivate sector. PresidentKaberuka also presided overthe launch of the Africa LionsInitiative.

For his part, the Ethiopian

Prime Minister, MelesZenawi, presided over theplenary session which washad the theme: “The place ofAfrica in the World Economy.”During the session, in whichseveral African heads of stateand government participated,the panelists expressed theiroptimism about the prospectsfor development and thecurrent crop of leadershipacross the continent.Innovation, technology,

agricultural transformation,education, governance,infrastructure, SMEs andinternational partnershipswere on the centre stage ofthe discussions. The 2012forum is co-chaired by KofiAnnan, Donald Kaberuka(AfDB), Doug McMillion(Wal-Mart), Gao Xiaqing(China), Monhala Hlahla(IDC) and Bekele Geleta(International Red Cross) andAdrian Monck (Moderator).

FIRS arrests officials of three firms over N2.17bn taxes

By AHMED IBRAHIM others to pay theiroutstanding tax liability orbeing compiled to do so.

He said that PivotEngineering owes N609.911million while RelianceTelecommunications is owingN592.756 million. HITV Ltd,he said is owing N309.500million while UTC NigeriaPlc is owing N277.589million.

Others include SweetSensation Confectionary Ltd,N155, 483,013:00,Entertainment Highway Ltd,N197, 444,964:55 and JohnHolt Nig. Ltd, N33,073,487:52.

During the exercise, someof the companies admittedtheir outstanding tax liabilitywhen the enforcement teamcalled at their offices.

For instance, Mr.Opedemowo Olayemi, theChief Accountant of SweetSensation Confectionary Ltd,said the company was owing

to the tone of N60 million forVAT alone.

Also, Mr. Dada Arokoyu ofUTC and Mr. Muyiwa Fojudeof Pivot agreed that theircompanies had outstandingtax liability to settle with theFIRS.

Similarly, when the teamvisited HITV Ltd,Entertainment Highway Ltdand RelianceCommunications Ltd, theiroffices were under lock andkey, but security at the gatesattended to the enforcementteam.

At HITV and Entertainmentthe team was told that theGTBank sealed up thepremises following a courtorder, while at the RelianceCommunication on thedirective of the Chairman ofthe company.

Stephen said, “ The arrestis a warning to otherorganisations and individualsin the country on the need to

ensure deductions andremittance of their taxobligation as provided by theFIRS Establishment Act2007.

“Any person who beingobliged to deduct any taxunder this act or the lawslisted in the First Scheduleto this Act, but fails todeduct, or having deducted,fails to pay to the Servicewithin 30 days from the datethe amount was deducted orthe time the duty to deductarose, commits an offenceand shall, upon conviction,be liable to pay the taxwithheld or not remitted inaddition to a penalty of 10per cent of the tax withheldor not remitted per annumand interest at the prevailingCentral Bank of Nigeriaminimum re-discount rateand imprisonment for periodof not more than threeyears,” the section stated.

Vanguard, MONDAY, MAY 14, 2012 — 25

CMYK

Capital Market

By MICHAEL EBOH

Founder of Tunde Lemo Foundation (TLF), Mr. Tunde Lemo, handing overthe keys of the ultra-modern clinic he donated to Nigerian Red Cross in Abeokuta,Ogun State.

BY MICHAEL EBOH

The Net Asset Value,NAV, of mutual fundslisted on theM e m o r a n d u mQuotation segment ofthe Nigerian StockExchange, NSE,appreciated by N1.264billion in one month,between March and

Mutual funds value risesby N1.26bn in April

April 2012.Specifically, the

mutual funds’ value roseby 1.46 per cent to closeat N88.1 billion for themonth of April 2012,from N86.836 billion atwhich it ended themonth of March.

The funds alsoappreciated by N525million in one week,rising by 0.6 per cent

from N87.575 billion atwhich it closed for theweek ended, April 20,2012.

Equity based funds,with a total NAV ofN40.618 billion,recorded the highestvaluation in April,followed by Real estatefunds with a NAV ofN16.334 billion andbalance based fundsrecorded a NAV ofN12.356 billion.

Money marketfunds’ NAV stands atN7.01 billion, Ethicalfunds recorded NAV ofN5.741 billion whileBond funds trailed witha total NAV of N5.428billion.

Union Homes RealEstate InvestmentTrust Scheme,managed by UnionHomes Savings andLoans Plc, recorded thehighest NAV ofN14.108 billion,followed by StanbicIBTC Nigerian EquityFund, managed byStanbic IBTC AssetManagement Limitedwith a NAV of N12.464billion and StanbicIBTC Money MarketFund also managed byStanbic IBTC Asset,with a NAV of N6.79billion.

ARM DiscoveryFund, managed byAsset and ResourcesManagement, ARM,Company Limitedrecorded a NAV ofN4.637 billion; FBNHeritage Fund,managed by First Bankof Nigeria Plc,recorded NAV ofN4.122 billion; SIMCapital Alliance Fund,managed by SIMCapital AllianceLimited’s NAV stood atN3.453 billion andZenith Equity Fund,managed by ZenithBank Plc posted NAVof N3.448 billion.

Others are: CoralGrowth Fund,managed by FSDHAsset ManagementLimited - N3.282billion; KakawaGuaranteed IncomeFund, managed byKakawa AssetM a n a g e m e n tCompany Limited -N2.936 billion andStanbic Ethical Fund,managed by StanbicIBTC Asset - N2.849billion among others.

26 —Vanguard, MONDAY, MAY 14, 2012

CMYK

BRIEFS

Capital Market Analysis

NACCIMA tasksFG on commodityexchange market

By Olayemi Fofah

The Nigerian Associationof Chambers of

Commerce, Industry, Minesand Agriculture, NACCIMA,has called on the FederalGovernment to urgentlypursue the development of thecommodity exchange market ifit is serious about increasingthe country’s agriculturaloutput and guaranteeing foodsecurity.

“This has become necessaryin order to get the best out ofour agricultural productivity,guarantee food sufficiency andstable income for farmers in thecountry,” said Dr. HerbertAjayi, President, NACCIMA.

According to Ajayi, who wasspeaking in Lagos, agricultureis being made the next primesector and mover (in place ofoil) of the economy, to restoreNigeria’s lost glory. He alsorecommended thatGovernment should, withoutdelay, understudy and adoptthe strategies of how Indiaand China exited from beingfood importers to become foodexporters during the last 30years, adding that if sincerelyadopted and implemented, itwill boost agriculturalproductivity and promoteemployment opportunities forover 10 million people.

Ex-GoldmanFlamand’s hedgefund misses rally

Edoma Partners, thehedge fund run by ex-

Goldman Sachs star , Pierre-Henri Flamand, has laggedbehind rivals this year after a“frustrating” period when itmissed out on a rally in stockand bond markets, a letter toits investors showed.

The $1.8 billion Edomafund, founded by Flamand tomake bets on corporate eventslike mergers, bankruptcies andrestructurings, was down 0.85percent at the end of the firstquarter, bringing its lossessince inception to 3.1 percent,according to the letterobtained by Reuters.

Flamand, formerly one ofGoldman’s most seniorproprietary traders, startedLondon-based Edoma inNovember 2010 in one of themost eagerly awaitedlaunches since the financialcrisis. A recovery indealmaking has helped event-driven funds this year, withthe average fund in the sectorup 4.84 percent during thefirst quarter, data from HedgeFund Research shows.

Stock market: First Bank’s shares

become toast of investors… First quarter profit doubles

Sterling Bank Plc hasrecorded a gross earningof N17.2 billion within

the three months ended March31, 2012, representing agrowth of 79 per cent from thecorresponding period of 2011.Interim report and accounts ofthe bank for the first quarterended March 31, 2012released weekend, showedimpressive growth in all keyprofit and loss indicators whilethe bank maintained a healthybalance sheet.The first quarter report,presented in the InternationalFinancial Reporting Standards(IFRS) format, showed that thecore interest income doubledby 116 per cent to N13.6 billionwhile net interest incomejumped by 73 per cent.

Stories byPETER EGWUATU

Following thei m p r e s s i v eperformance of First

Bank Nigeria Plc in the firstquarter 2012 and full yearresult of 2011 recently releasedon the Nigerian StockExchange (NSE), the bank’sshares have continued to bethe toast of investors in thestock market.

First Bank’s profit doubled,while revenue jumped by 42per cent in its first quarterfinancial year ended March31, 2012.

This is coming after the bankrecorded a significant growthin its performance indicatorsfor the full financial yearended December 31, 2011

A review of the bank’sperformance on the stockmarket show that its sharesgained 14.2 per cent fromN9.72 per share on17th April2012 to close at N11.10 pershare at the end of trading onThursday, May 10, 2012.

Specifically, on April 17,2012 when the bank releasedits full year audited result tothe market, the market valueof the stock rose by 4.97 percent to close at N9.72. Also atthe end of market transactionson May 3, 2012, the bank’sstock rose to N10.99 pr share,a whopping 18.68 per centincrease.

While commenting on theperformance of First Bank,Executive Director, MarketOperations and Technology ofthe NSE, Mr. Adeolu Bajomosaid, “The market hascontinued to respondpositively to First Bank’s stockwith added interestdeveloping as its first quarterinterim report was released onMay 2 2012 with grossearnings having risen by 42.5per cent in the first threemonths of the ongoingaccounting year. This is anindication that investors of thebank will have cause to smileat the end of the currentaccounting period.”

Bajomo, commended themanagement of First Bank forbuilding an institution whichover the years, haspurposefully transformed intoa national pride.

A cursory review of theperformance shows that FirstBank’s profit doubled, whilerevenue jumped up by 42 percent in its first quarterfinancial year ended March

31, 2012.This is coming after the bank

recorded a significant growthin its performance indicatorsfor the full financial yearended December 31, 2011

The first quarter result madeavailable by the NSE showedthat the bank’s net income roseto N24.5 billion for the threemonths through March fromN12.2 billion in thecorresponding period 2011.

It will be recalled that FirstBank, which in October 2011agreed to buy Congo’sBanque Internationale deCredit, is looking to acquireanother lender this year inWest Africa, Chief FinancialOfficer, Adebayo Adelabu hassaid.

The bank, as gathered isplanning to add 120 branchesin Nigeria to make a total of750 branches.

Other performance

indicators shows that Bank’sloans and advances increased12 per cent to N1.89 trillion ,compared with a year earlier.Its deposits climbed 8 per centto N2.29 trillion.

Meanwhile, it will berecalled that the bank in its fullyear result ended December31, 2011, recorded 27.6 percent growth in gross earningsto N296.3 billion from N232.1billion in the correspondingperiod of 2010.

Operating income grew by45.6 per cent to N259.2 billionin 2011, from N178.1billion in2010.

It also recorded 92.9 per centgrowth in profit before tax andexceptional item to N65.6billion as against N34 billionin the corresponding period of2010.

Profit before tax grew by 48.2per cent to N50.1 billion fromN33.8 billion in 2010.

Other performanceindicators show strongimprovement in cost to incomeratio to 56.8 per cent from 67.0per cent in 2010, while 55.1per cent ratio recorded in theBank from 65.8 per cent in2010. Provision for losses ofN44.8 billion was recorded in2011, as against N21.6 billionin 2010, of which loan lossprovision was N32.9 billion asagainst N22.4 billion in 2010.

Commenting on the results,Bisi Onasanya, GroupManaging Director of FirstBank said:

“We have made significantprogress in achieving ourstrategic goal of being thenumber one financial servicesgroup in Nigeria. Our resultsare reflective of the benefitsbeing reaped from theimplementation of ourtransformation agenda whichhas improved customer focus,acquisition, satisfaction,business generation andenhanced the sustainability ofour earnings base.

This has brought about

Sterling Bank gross earnings up by 79% in first quarter

Operating income grew by 49per cent just as profits beforeand after tax rose by 24 percent and 16 per centrespectively.Gross earnings stood at N17.2billion in first quarter 2012 asagainst N9.7 billion recordedin the corresponding quarterof 2011. Net interest incomehad risen from N3.6 billion in2011 to N6.3 billion in 2012.Operating income rose fromN6.1 billion to N9 billion whileprofits before and after taxincreased to N1.6 billion andN1.3 billion respectively.Key balance sheet items alsoimproved during the periodwith total assets adding N17billion to close the quarter atN521.4 billion as againstN504.7 billion in December2011. Customer deposits

increased from to N412 billionas against N392.1 billion inDecember 2011 while net loansand advances grew fromN164.3 billion in December2011 to N177.8 billion inMarch 2012.Commenting on the firstquarter performance,managing director, SterlingBank Plc, Mr. Yemi Adeola,said with the completion of theintegration of the EquitorialTrust Bank, which it recentlyacquired, the bank has re-aligned its business to deepencustomer relationships andenhance market penetration.According to him, theenlarged branch networkprovides a platform for low costdeposit mobilization, theresult of which is evident inthe 400 basis pointimprovement in deposit mixduring the first quarter.

From left: Mr. Lere Odusote, Head Business Development, Oando Gas and Power Limited; Mr.Solomon Adegbie-Quaynor, Country Manager, International Finance Corporation, IFC andMr. Onajite Okoloko, Group CEO, Notore Chemical Industries Limited at the power conferenceorganised by Ecobank in Lagos. Photo by Lamidi Bamidele.

Vanguard, MONDAY, MAY 14, 2012 — 27

CMYK

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Tax Platform

28 —Vanguard, MONDAY, MAY 14, 2012

,

,

•Ifueko Omoigui-Okauru

National Tax policyguidelines and rules (2)

Assets:This includes taxes,such as property tax and oth-er such taxes imposed on landor landed property.

The above list illustrates thedifferent bases upon whichtaxes may be imposed, as dis-cussed above.

Having provided a workingdefinition of taxation, there isa need to differentiate taxationfrom revenue for a proper un-derstanding of the role of tax-ation in the development ofthe Nigerian economy. This isparticularly necessary, asthere is usually the miscon-ception that every form of rev-enue obtained from the pub-lic is a tax.

Revenue is defined as in-come received from all activi-ties engaged in by the receiv-ing entity. In Governmentalterms, revenue is the entireamount received by the Gov-ernment from sources withinand outside the Governmentterritory. In Nigeria, Govern-ment revenue includes pro-ceeds from sale of crude oil.taxes (including import andexcise duties), penalties, in-terests, fines, charges and oth-er earnings received fromGovernment investments(bonds, dividends e.t.c.), andthe like. Revenue thereforeencompasses the entire gam-ut of Government income,which is realised and availa-ble for expenditure by Gov-ernment within a particularfiscal year or period.

Taxes are therefore, a sub-component of Governmentrevenue, but they are not theonly revenue item, which isinternally generated by Gov-ernment. Other sources of in-ternal revenue include fees,rates, levies, fines, tolls, pen-alties and charges. Taxes arehowever a major contributor toGovernment revenue and ide-ally should be a major sourceof revenue.

In discussing taxation, thereare usually four (4) “R”slinked with taxation and itspurposes, namely:

* Revenue - it is generallybelieved, that the main pur-pose of taxes is to raise reve-nue for use by Government; *Redistribution - taxes may beused to transfer wealth fromone section of the society toanother; *Repricing -taxesmay be used to address exter-nalities i.e. fiscal policies maybe used to affect some area ofthe economy, which cannototherwise be done; and * Rep-resentation - this is historicaland implies that taxes are im-posed to assure citizens

of representation in the Gov-ernance of the society. In thisregard, rulers impose taxes

and citizens demand ac-countability in return. Of theabove, revenue generation isviewed as the primary andmost important role of taxa-tion. Taxation is however not

only a means of revenue gen-eration for Government, it canalso be used to stimulate oth-er sources of Government rev-enue and develop other areasof the economy from whichGovernment can realise reve-nue.

Distinction between Taxa-tion and other components ofRevenue

A further but brief discussionmay be necessary on the dis-tinction between taxes andother internal revenue itemssuch as charges, levies andpenalties. Such other revenueitems are not usually incomeor transaction based, but maybe imposed for the use of util-ities or infrastructure, or theright of way or simply im-posed on certain category ofpersons, activities or personswithin a particular area. As adefinition of taxation has beenprovided above, a workingdefinition of similar items isprovided below;

* Charge - a charge is anamount paid for the use ofgoods, services or infrastruc-ture provided by the Govern-ment;

* Fee - a fee is a payment forthe labour or services provid-ed by a public body, such as aGovernment entity or agency.Examples of fees include pay-ments for use of utilities andfor obtaining Government doc-uments such as passports andvisas.

* Fines - these are sums ofmoney imposed by the Gov-ernment as penalties for an of-fence or indiscretion by a per-son within the jurisdiction ofthe Government. Examples offines include Court fines, finesimposed for traffic violations,unauthorised usage of Gov-ernment property e.t.c.

* Penalty - this is similar toa fine and is usually anamount paid or forfeited fornot meeting a particular con-

dition or fulfilling an under-taking. Examples of penaltiesinclude payments for late fil-ing of returns, or the late ornon-provision of information atthe time required to Govern-ment agencies.

* Rates - these are usuallyimposed on property or otherassets and are usually deter-mined with reference to thevalue of the property or in re-lation to some other thing.Examples of rates include ten-ement rates and rates onshops and kiosks.

The above is not intended asan exhaustive definition of theabove concepts, but merely aworking guide to enable aproper distinction betweentaxes and these other compo-nents of Government revenue.In practice, there may be littledistinction between what con-stitutes a tax or charge or fine,as these concepts can some-times be interchangeable,however, it is still necessaryto keep in mind the distinc-tion as set out above.

It has also been noted, thatunder the current structure ofGovernment in Nigeria, taxesat the Federal and State levelare usually more efficientlycollected and utilised than

most of the other revenuesources highlighted above.However, unlike other reve-nue items, tax officials do notexercise custody or controlover taxes, which they collectand are not involved in the al-location or expenditure of thetaxes.

This distinction betweenthose who collect and thosewho utilise is important forcontrol purposes and also be-cause the manner of utilisationof revenues collected impacts

directly on the ease with whichsuch revenues are collected.

Sustainable Developmentand Healthy Competition asthe overriding Philosophy ofthe National Tax Policy

Sustainable development isdevelopment that meets theneeds of the present withoutcompromising the ability offuture generations to meettheir own needs. In this con-text sustainable developmentrefers to the pattern of reve-nue generation, which is ableto meet the needs of thepresent generation of Nigeri-ans, without negatively im-pacting the ability of futuregenerations to meet their ownneeds. Generally, taxation islooked upon as a sustainablesource of Government reve-nue due to the stability andcertainty of the tax system.Unlike other sources of reve-nue, taxes are constantlyavailable in so far as econom-ic activity is carried on in thesociety. Recent developmentsin the global and local econo-my which have significantlyimpacted Government reve-nue has directed focus on tax-ation as a sustainable sourceof income.

It is in line with this that theNational Tax Policy intends tocreate awareness on the im-portance of the role, which tax-ation can play in securing astable flow of revenue for theGovernment. Nigeria is cur-rently viewed as a mono-prod-uct economy with significantreliance on oil revenue due tohistorical developments in theNigerian economy. However,taxation has been identified asan alternative to oil revenueand a more reliable source ofrevenue. The tax policy shalltherefore promote and en-courage a shift in focus fromnon-tax revenue to tax reve-nue by Governments at all lev-els of the Nigerian economy.

Following from the above,the tax policy shall also pro-mote and encourage healthycompetition amongst tax andrevenue authorities in Niger-ia at the Federal and State lev-el to facilitate rapid develop-ment of the tax sector in Ni-geria. The focus of the com-petition shall be to maximisetax revenue within the juris-diction of each Government inline with Constitutional andstatutory provisions. It is ex-pected that there would beincreased collaboration as aresult of the need to grow taxrevenues by each level of Gov-ernment and that improvedcollaboration would enhancetax yield - between andamongst Federal, State and

Local Government authorities.The concept of sustainable

development and healthy com-petition shall be upheld asunderlying philosophies inthe development of Nigeria’stax system. It is however im-portant to note that even ashealthy competition is encour-aged, this should be balancedwith the need to have an ef-fective and efficient tax sys-tem. Several jurisdictionshave different ways of strikingthat balance. In Nigeria, thatbalance will be achieved byensuring that those ratios thatdrive allocation of revenuecollected from any source hasbuilt in mechanisms for re-warding and recognising armsof government that demon-strate effective utilisation ofrevenues, investment promo-tion, infrastructural develop-ment and economic activityamongst others.

The role of Fiscal Federal-ism

Fiscal Federalism is expect-ed to play a major role in Ni-gerian tax policy and admin-istration. In this regard, it isintended that the concept ofFiscal Federalism would bethe common thread holdingthe National Tax Policy to-gether. Nigerian tax policywould therefore uphold theapplication of fiscal federalismin the generation and ex-penditure of revenue by Gov-ernment at all levels in ac-cordance with the tenets of theNigerian Constitution. Thereshould be strict adherence tothe tenets of fiscal federalism,which will include the basicunderstanding of which reve-nue functions and agenciesare best centralised, whichshould run concurrently andwhich are better placed underthe sphere of decentralisedlevels of Government.

In this regard, it is expectedthat the Tax Policy and othertax legislation, would resolvethe issue, of who collects what,how it is collected, who con-trols what is collected, how iswhat is collected shared, whois responsible for spendingwhat is collected and who isultimately responsible andaccountable to the tax payersfor the revenue collected andits expenditure. The Tax Poli-cy would provide a workableand acceptable platform whichshould be adopted by all tiersof Government for the properapplication of the doctrine ofseparation of powers in rela-tion to taxation. It is believedthat adherence to these prin-ciples which would be dis-cussed

in the National Tax Policywould bring an end to dis-putes on the limits and pow-ers of the tiers of Governmentin our Federation on fiscalmatters. It will also bring clar-ity and certainty to tax admin-istration and the entire Nige-rian tax system.

Generally, taxa-tion is lookedupon as a sus-tainable source ofGovernment rev-enue due to thestability and cer-tainty of the taxsystem. Unlikeother sources ofrevenue, taxesare constantlyavailable in sofar as economicactivity is carriedon in the society.

Vanguard, MONDAY, MAY 14, 2012 — 29

30 — Vanguard, MONDAY, MAY 14, 2012

Vanguard, MONDAY, MAY 14, 2012 — 31

32 — Vanguard, MONDAY, MAY 7, 2012

CMYK

Interview

The Minister of Tradeand Investment,Olusegun Aganga,

recently disclosed plans by hisMinistry to improve thecountry ’s globalcompetitiveness ranking fromits current position of 137 to34th by 2015. He said that hisMinistry is working to ensurethat Nigeria occupies the top-five position in Africa in thisregard, and also increasemanufacturing contribution toGDP to eight per cent from thecurrent 4.5 by the same year. Excerpt:

By Babajide Komolafe &Franklin Alli

What steps are you taking

to achieve your targets?There is no reason why we

can’t achieve our goals; whenwe started, we workedtogether with the OrganisedPrivate Sector (OPS) and wecame up with a number ofrecommendations which weare implementing now. Wealso have a team working,precisely, on the World Bank’srecommendations on the ‘Easeof Doing Business andCompetitiveness’ and we haveInter-Ministerial Committeewho are also working on the‘Ease of Doing Business andCompetitiveness.’ In 2010,we invited theCompetitiveness Office of theWorld Economic Forum andwe told them to go throughour recommendations and tellus what other countries thatwere in similar positions didto achieve economictransformation.

So, I think if those threegroups did what they aresupposed to do, there is noreason why we should notachieve the goals we have setfor ourselves. For instance,when I talked about increasingNigeria’s globalcompetitiveness ranking by103 positions over the nextfour years, this will catapultNigeria from its current137

thposition to number 34, in

global competitiveness by2015. We also intend tooccupy the top five positionin Africa by that year;improving Nigeria’s rankingin the Ease of Doing Businessby 103 positions and enablingtrade ranking by 75 positions,increasing manufacturingcontribution to GDFP from 4.5percent to 8 percent, amongother measurable targets.

We have alreadyinaugurated the DoingBusiness and CompetitivenessCommittee and the Investor-Care Committee as the firststep in a series of well laid outplans. We are also workingwith the World Bank‘sCompetitiveness Office andwe have agreed on specificsteps to take. The World Bankis part of the team working

,

,

We are concerned about substa

with us on the Ease of DoingBusiness. Also, we arelooking at areas we have 100per cent comparative andcompetitive advantage.

In your speech, you

returns, the chances ofattracting FDI will behampered. So, it is importantto look after those that havealready invested in theeconomy through appropriatepolicies and incentives.

investment in the economy. Recently they commissionedtheir new brewery plants inLagos; so too is Flour Mills ofNigeria PLC; BUA Group’s $5billion Pasta plant in Lagos,are among other examples ofdomestic investments.

You were recently in Brazil.What was the highlight of thetrip?

Brazil, as you know is oneof the BRICS (Brazil, Russia,India, China and SouthAfrica) economies, and theyare doing extremely well.Nigeria has so many things incommon with Brazil in termsof natural resources, cultureand language (Yoruba) . Brazil is the largest country inLatin America by size, andNigeria is the largest countryin Africa by population,although they are remotelybordered across from oneanother by the Atlantic Ocean.

For centuries, Brazil andNigeria have enjoyed awarmly, friendly and strongrelationship on the bases ofculture (since many Afro-Brazilians trace their ancestryand religious practices toNigeria) and commercial

trade. More importantly, Brazil hasgrown very successful companies likePetróleo Brasileiro or Petrobras, whichis doing very well. So, we have a lotwe can learn from Brazil. So thesynergy is very strong and very keyto what we can do in Nigeria. However, in order to facilitate tradeand investment between the twocountries, we need to make sure we

emphasised so much on FDI,what about domesticinvestment?

We are interested in ForeignDirect Investment, FDI, andwe are also interested in LocalDirect Investment, LDI,because, if we don’t work andmake sure that people thathave already invested actuallyoperate well and generate

Some o f the localinvestments on ground is theDangote. You have alreadyseen what the Group hasinvested across differentsectors, and by next week,they will be commissioningthe third phase of ObajanaCement in Kogi State. Nigerian Breweries Plc hasalso expanded their

If we don’t work and makesure that people that havealready invested actuallyoperate well and generatereturns, the chances ofattracting FDI will behampered.

•Olusegun Aganga

•Fake goods being destroyed.

Vanguard, MONDAY, MAY 7, 2012 — 33

CMYK

Interview

andard goods from China —Aganga

of the secret of theirindustrialization. It is not just peoplewho went to universities and thereafterstarted struggling for job in the labourmarkets. That is what we must do inNigeria. That is part of my industrialrevolution plans- select the rightsectors that have competitive andcomparative advantage, bring ininnovation and skills.

So, that’s the highlight ofmy visit to Brazil. Did I signany bilateral agreement inBrazil? If I told you that I did,you should be worriedbecause I had only gone therefor three days. If they gave medocument to sign, I have togive it to our lawyers toreview it and it is only whenmy lawyer tells me to sign thedocument that I will do that.When signing document youhave to be careful of the legalimplications. So, I don’t signany document without ourlawyers advising me to do so.

What are you doing about

companies that relocated toneighbouring countries?

I know some of them thathave started coming back toNigeria. Part of the study that

What’s Nigeria’srelationship with China?

At the political andeconomic level, we areenjoying good relationshipwith China, but the area weare concerned is “substandardgoods.” The Director Generalof SON, Dr. JosephOdumodu, will be here topresent a paper on “Tacklingthe Menace of SubstandardProducts in Nigeria.” He‘lltell you that 75 percent ofproducts circulating in theeconomy today aresubstandard. He will also tellyou that a large percentageof that figure comes fromChina; he will also tell you theaction he has already takento curb the menace. So, weare aware of the issue and wehave already taken action. We have devised a systemthat is now working and theincidence of substandardgoods is coming down. Wehave a target of bringing itdown further every year forthe next four years. So weare addressing the issuealready.

What’s your take on thePower sector andinfrastructure?

We have a Roadmap onPower sector. However, if welook at power from anindustrial perspective whichis very relevant to yourquestion, there is short-term,medium-term and long –termplan we have put in place. But we will not achieve thetarget if we want to be honestto ourselves in the next oneor two years. That is why theMinister of Power, BarthNnaji, has made it absolutelyclear that by the end of thisyear, he will re-direct powerto nine industrial cities. Thatis one big news/policy we arewaiting to see theimplementation.

There is nothing we look atin the economy thatinfrastructure does not touchin one way or the other. Wehave trade-related

infrastructure, tourism relatedinfrastructure, export relatedinfrastructure, etc. Recently, Ivisited a state in the south-south part of the country andI was told that it is cheaper toexport goods from there toChina than to sending it toMaiduguri; the cost ofsending it to Maiduguri ishigher. We will work closelywith the Minister of Transportto address the challenges.

What are the measures topromote SMEs and createjob?

There are a number ofinitiatives on that. We are alsogoing to put them in clustersand make them have powerand other infrastructures. The Bank of Industry isinvolved in that and isworking with statesgovernment to develop theirSMEs sectors. Now If wantto play your game, I wouldsay two million jobs, but thatis not me. If I say things, Ihave to defend it. What I cantell you is, our programme isgeared towards job creation.

We are monitoring it and aswe do our regular pressconference, we will be able totell you how many jobs havebeen created. For instance, inthe case of local sugarproduction, we haveconcluded work on a NationalSugar Master Plan (NSMP)that would save the

about two percent of the sugarit consumes.

The NSMP will ensure onan annual basis localproduction of 1 ,797,000 tonnes of sugar; 161.2million litres of ethanol,4000MW of electricity, 1.6million tonnes of animalfeeds, 37,378 permanent jobsand 79,803 seasonal jobs. Today, if anybody sits in frontof you and say we havecreated so and so number ofjobs, they are lying.

What is take on state ofsecurity in the Country:

I have observed thatNigerians at home and in theDiasporas talk more aboutsecurity than foreigninvestors. But when you meetwith foreign investors theissue of security does notalways come up; none of theforeign investors I have mettalked about security problembut when you meet with theDiasporas group, it is securitythey talk about. I am notsaying that security is not anissue. The point I am makingis, Nigerians talk more aboutsecurity than foreigners.Foreign investors take along-term view not a short-term one. What they look atis if I can invest today, I willmake more money in thefuture. And when the returnis much higher than the risk,they invest. That is thereason why I don’t lay muchemphasis on security whentalking to investors.

On theLocal Content Law?At the moment, it applies to

I ordered my ministry toinvestigate was ailingindustries that closed downand those that left Nigeria toother countries. We did astudy on why they left, whatthe issues were and how wecan attract them back into thecountry and we have workedon their recommendations.

have a logistics structure. If you are going to Brazil

from Nigeria, if you look atthe map, a journey that shouldhave taken you a minimum ofsix hours will take you 24hours. Why? Because youhave to fly from Nigeria toDubai for seven hours, andthen you wait for eight hoursto catch the next flight toBrazil, and that flight now flyover Nigeria airspace andgoes to Brazil. 14 hours iswasted; so it really doesn’tmake sense. Nigerian andBrazilian government haveboth agreed that they must dosomething about it. Again, ifyou look at Brazil’s economicgrowth, industrialization isbased on a well structuredSkills AcquisitionDevelopment Programmeand it is being run by thecountry ’s IndustrialAssociation.

They have about 90 skillscentre spread across thecountry and you havestudents who are beingtrained from fourteen yearsof age. The skillsdevelopment centres are verywell structured and are veryeffective. In fact, each year,they create three million jobsof highly skilled workers.They also have governmentpolicy to back theestablishments. That is part

economy $416 million (N68.6billion) in foreign exchangeand generate over 100,000jobs from local production ofsugar by year 2015.

I am glad to inform youthat with the proven potentialfor wealth creation and highemployment generation in thesugar industry, a NigerianSugar Master Plan, NSMP,have been produced whichprovides the Roadmap for atleast 100 percent localproduction in sugar. As oftoday, Nigeria produces only

the oil and gas sector. We aregoing to extend it to othersectors where we havecompetitive advantages. Weare actually coming out witha local patronage Bill thatwill encourage patronage ofquality Made –in – Nigeriaproducts like the LocalContent Bill; because thepatronage of what weproduce locally is abysmallylow. Meanwhile, I want to askfor your contribution. In yourown opinion, tell us what wecan do to encourage thepatronage of local products.

,

,

If I want to play yourgame, I would say twomillion jobs, but that is notme. If I say things, I have todefend it. What I can tellyou is, our programme isgeared towards job creation.

•Olusegun Aganga

34 — Vanguard, MONDAY, MAY 14, 2012

BRIEFS

Mortgage Finance

Lagos designsprototypebuilding toboost housing

In a bid to make its newhome ownership scheme

to be sustainable andhomogenous, Lagos Stategovernment has developed aprototype building which is tobe replicated across the state.

Special Adviser to the StateGovernor on Housing, Mr.Jimoh Ajao, said the rent-to-own policy initiative was, inthe first place, planned tocommence with existing stockof houses provided by theministry.

He said that the stategovernment will continue tointervene in the sector withpolicies aimed at addressinghousing challenges throughmortgage finance. “Our policyon housing is to provideopportunities for theconstruction of houses ataffordable prices; initiateprogrammes to address thedemand and promote supplyof housing through the LagosHomes Scheme,” he said.

According to him, so far,one-bedroom and two-bedroom flats are availableunder the scheme at ObaAdeboruwa Housing Estate,Igbogbo, while three-bedroomflats are ready at Hon. OlaitanMustapha Housing Estate,Ijaiye-Ojokoro, Iloro HousingEstate, Agege, and Hon.Rotimi Sotomiwa HousingEstate, Igbogbo, Ikorodu. Healso said that room andparlour, one-bedroom andtwo-bedroom bungalows canalso be acquired under theplan at the Sir MichaelOtedola Housing Estate,Odoragunshin, Epe.

Bauchi warnsagainst illegalstructures

Bauchi State governmenthas warned residents of

the state against illegallyerecting structures that are notin conformity with theapproved plan of government.

Commissioner for SpecialDuties, Alhaji Bappa Azare,gave the warning whileinspecting some projects inthe state. He directedmanagement of the StateDevelopment Board (SDB) topull down all illegal structuresto pave way for proper roadlayout and water ways, whileinspecting a 2.5 kilometreroad and drainage in Dumivillage of Bauchi localgovernment area.

“Henceforth, affected landowners will be required topresent certificate ofoccupancy to all their lands,”he added.

Professionals in

the building sector have declared

that the housing crisis in thecountry will persist ifdeliberate measures are nottaken by stakeholders toensure the use of indigenousbuilding technology andmaterials. At the justconcluded Lagos Housing Fair(LHF) held in Lagos, with thetheme, “IndigenousTechnology and HousingDelivery”, professionals in thehousing industry and relevantorganisations submitted thatall efforts to tackle the housingcrisis confronting the nationwill prove abortive unlessgovernment and allstakeholders embark onbackward integration inhousing delivery technology.They called for thecommencement of in-depthresearch into indigenoustechnology in housingdevelopment, noting that thisis the roadmap to effectivelyconfronting the housingchallenge facing the country.

Speaking on a paper titled,“The Nigerian Civil Engineersin Quest for IndigenousTechnology”, NationalChairman, NigerianInstitution of Civil Engineers

‘Indigenous technology key to tackling housing crisis’

(NICE), Mr. Ade Omopeloye,noted that the development ofmost advanced countries allover the world is based on thelevel of their indigenoustechnology.

He noted that the publicinfrastructure that enhancesthe quality of the livingenvironment is the result ofwell researched andimplemented technologicalideas. “For a developingeconomy like ours, the questfor indigenous technologycannot be over-emphasized,”he said. Omopeloye lamentedthat Nigeria is yet to attain thestage of self-sustaineddevelopmental goals, eventhough a lot of appreciableefforts have been channeledinto research works onindigenous technologicaldevelopment. He saidmilitating factors include: lackof well established standardsto facilitate improvements innewly discovered idea;discovery in local technologymarred with skepticism andsometime with scorn; lack ofgovernment policy toencourage theimplementation of researchedindigenous technology; lackof funds and; lack of enablingenvironment to translate

results of research intoproductive processes.

“However, in spite ofdiscouraging factors workingagainst this quest, theNigerian Civil Engineerscontinues to wax stronger andmake remarkableachievements in the practiceof civil engineering,” he said.

Earlier, in his openingaddress, Chairman, LagosHousing Fair Committee, Mr.Moses Ogunleye, said it washigh time policies were put inplace that would aid theresearch, development andpromotion of indigenoustechnology.

Ogunleye, who isalso managing partner,Beachland ResourcesLimited, noted that countrieslike China, Japan and othersin the Asian continents haveproved beyond reasonabledoubt the success in the useof indigenous technology. Heurged government and otherstakeholders to ensure thatall hands are on deck to bailout Nigeria from acuteshortage of housing provision.“The only positive approachis the use of indigenoustechnology that would notonly be cheaper, but would beenvironmentally friendly”, hesaid.

Government still seeking suitablemortgage system for Nigeria —Minister

Government is yet tofashion out a suitable

mortgage finance system thatwill ensure improved accessto housing for Nigerians.

Minister of Lands, Housingand Urban Development, MsAma Pepple, stated this at aMortgage FinanceRoundtable recently held inAbuja, organised by theCentral Bank of Nigeria(CBN) in collaboration withthe World Bank and theUnited Nation’s Departmentfor International Development(DFID).

She noted that mortgagefinance remains a seriouschallenge affecting housingdelivery in the country. “We,therefore, need to ponder onhow to improve accessibilityto mortgage finance in orderto stem the present trendwhereby most home ownersin the country rely on theirpersonal savings to build theirhouses,” she said.

According to the minister,Nigeria has one of the lowestmortgage penetration in Africain terms of mortgage to debtat less than four per cent,adding that governmentneeds to ponder on how toimprove accessibility tomortgage finance in order tostem the present trendwhereby most home ownersin the country rely on theirpersonal savings to build theirhouses.

“In spite of the growingmortgage market in Nigeria,the mortgage to debt ratio,which is a factor of mortgagepenetration, is less than 4percent. Using the figurespublished by the Africa 2011Year Book of the Centre forAffordable Housing in Africa,Nigeria has one of the lowestmortgage penetrations on thecontinent in terms ofmortgage to debt at less thanfour per cent. This is incomparism to South Africa at30 per cent, Namibia at 20 percent, Morocco at 15 per centand Tunisia at 13 per cent.

“Other countries, such asKenya, Rwanda, Botswana,Senegal, Algeria and Ugandaalso fared better on the scalein spite of their low ratings.The comparative figures forsome developed countriesand emerging economies arethe United States, which is 82per cent, Singapore 34 percent and Malaysia 24 per centas at 2009.

“In terms of incomedisposition, less than sevenper cent households can affordto obtain mortgage loans evenif it is spread over a period of20 years, in view of the high

poverty level. The funding ofmortgages from short termdeposits in the bankingsystems leads to theenthronement of high interestregimes and wide

affordability gap in homeownership. Though loanssourced from the NationalHousing Fund (NHF) aremuch cheaper at six per centinterest, this is still considered

high relative to what obtainsin developed countries.

“Other challenges in themortgage industry includeundercapitalised primary andsecondary mortgageinstitutions, lack of vibrantsecondary market, and lack ofcommon underwritingstandards, low inflow of directforeign investment, which isin favour of oil and gas,agriculture and solid mineralsamong others,” she stated.

•Blocks of luxury apartments

Vanguard, MONDAY, MAY 14, 2012 — 35

36 —Vanguard, MONDAY, MAY 14, 2012

Agric

By OLASUNKANMIAKONI

Governor BabatundeFashola of Lagos State

led administration has donea lot to make thetransformation agenda in thestate a success. The presentadministration has built a20,000 metric tonnes perannum Rice Milling Plant atthe Agro-Industrial Park,Imota to boost capacity of thelocal rice production and havetremendously increased thehectareage rice plantationfrom 30 ha to 450 ha and isplanning to increaseproduction to 1000 ha.

A lot of work had also beendone in the cassava sector ofthe Transformation Agenda. Ithad delineated areas aroundIkorodu, Epe and Ibeju Lekkiaxis as Cassava Productionand Processing Belt (CPPB),where incentives for cassava

Lagos disburses N32m worth of agricultural inputs

to farmers...Acquires land for farming in other states

production, processing andmarketing would beconcentrated. This is topromote employment, ruraldevelopment and reducepoverty through theeconomics of cassavaproduction.

A modern cassavaprocessing plant to produceHigh Quality Cassava Flour(HQCF) has been processedfor construction in the CPPB.

In the Aquaculture value-chain the state governmentaimed at creating an enablingenvironment to achieve onemillion metric tons of fishsustainability within fiveyears and to generate fivehundred thousand jobswithin Lagos State that wouldlead the nation.

Being the foremost statewith the greatest potential inaquaculture, the state hasinvested in the followingareas: Hatcheriesdevelopment, cage and pen

culture using water bodies,fish estate and clusters, fishprocessing plants, fish feedmilling and inputsdevelopment, research andextension among others.

Thus, as part of effort toboost local production ofvarious agricultural produce,the state government hasacquired land fromneighbouring states forframing purposes for the everincreasing populace in thestate.

Fashola, who wasrepresented by his deputy,Mrs Orelope Adejoke-Adefulire, disclosed this at theofficial presentation offarming equipment tobeneficiaries andcommissioning of farm servicecentre, Oko-Oba, Agege,Lagos.

The event which alsomarked the 2012 FarmersAppreciation Day, the secondof its kind, to celebrate andappreciate the efforts offarmers and fishermen in thestate witnessed the

distribution of variousagricultural inputs worth overN32 million at 40 percentsubsidy by the stategovernment to beneficiaries.

According to Fashola, whostated that the measure alsoaimed at bringing servicecloser to farmers andstakeholders, promised thatby year 2025, the state wouldproduce at least 20 to 25percent of its food needslocally and 60 percent targetby 2050.

He noted that the centre hadtrained 1000 farmers since itsinception in all aspect oflivestock, poultry, piggeryand snail production, notedthat the country was facedwith the challenge of feedingits huge population and foodsecurity was being threatenedby rising food prices, whichis a major sign of food crisisin Nigeria.

“Food security which is oneof the cardinal programmes ofthe ten-point agenda of myadministration is also anintegral part of the Lagos

State EconomicEmpowerment andDevelopment Strategy(LASEEDS) document as wellas the resolutions of theEhingbeti summit and theMillennium DevelopmentGoals (MDGs). It also tallieswith the objectives ofestablishing the farm servicecentre to train more people insustainable food production”,he added.

He said that the stategovernment had commencedthe process of decentralizingthe entre by replicating it inthe five divisions of the statein order to bring servicecloser to the people.

“The state has commencedthe purchase of land fromother states in order toachieve its food securityagenda. An example isOshogbo, where we wouldsoon commence the plantingof cash and food crops likepineapple, citrus and otherhigh value crops to sustainour people.

Vanguard, MONDAY, MAY 14, 2012 — 37

38 — Vanguard, MONDAY, MAY 14, 2012

Vanguard, MONDAY, MAY 14, 2012 — 39

Insurance

40 — Vanguard, MONDAY, MAY 14, 2012

TalkingInsurance

WITH

Yinka Bolarinwa

Reforms and theinsurance industry (1)

IN 2009, Sanusi Lamido Sanusi was appointedgovernor of the Central Bank of Nigeria and heimmediately went to work with more reforms in

the financial services sector. It should be noted thatthat sector was just settling down with the reforms in-stiuted by his predecessor, Professor Charles Soludo.Sanusi unveiled a ten-year reform plan based on fourpoints for the stabilization of the banking sector andthe finance sector in general. According to him, thefour programmes for the sector’s transformation in-volves enhancing the quality of banks; establishingfinancial stability; enabling healthy financial sectorevolution and ensuring that financial sector contrib-utes to the real economy.

In the insurance sector, capital base requirement forlife insurers was raised from 150m Naira to 2bn Naira,general insurers to 3bn Naira from 200m Naira, andfor reinsurers it moved from 350m to 10bn Naira. Thissub-sector offers insurance cover for various types ofrisks. Most non-life businesses cover risks such as fire,burglary, marine, accident, engineering, workmen’scompensation and loss ofincome; while most lifebusinesses offer life assur-ance.

By raising the bar thus,the industry has been suc-cessfully rid of players whohad ben sucking the lifeblood of the industry. Thisis even more graphicallyreflected on the number ofinsurance companies oper-ating in the country. Hith-erto, there were about 128insurance companies inNigeria and everywhereyou looked there was aninsurance firm. But afterraising the bar, the numberwent down to 62, and manyof them are not stand alone companies; some are dualcompanies. If you are talking about insurance compa-nies we don’t have more than 29. That is the effect ofthe action of government raising the bar of capital and,since then, we have begun to have a semblance ofsanity in the insurance industry. We now have the emer-gence of serious companies that are listed on the StockExchange. We have over 30 insurance companies list-ed on the stock market now, and they are doing verywell despite the global meltdown that has affected glo-bal investments worldwide.

The composite business, which has a new minimumcapital base of N5bn Naira (2bn Naira for life assur-ance and 3bn Naira for general insurance), is grow-ing rapidly with significant number of insurance com-panies now underwriting both life and non-life risks.The business is expected to grow even more with thepassage of the oil and gas local content policy, as theinsurance companies are expected to handle a hugepart of the underwriting in Nigeria.The financial serv-ices industry is highly regulated by the following bod-ies: The Nigerian Accounting Standard Board, Cen-tral Bank of Nigeria, Nigerian Deposit Insurance Cor-poration, National Insurance Commission, amongstothers.

Despite the work done and still being done by thesebodies, problems still persist, chief of which is poorperception of the industry by the public, which in turnhas led to poor patronage.

As a result, things taken for granted by insurancefirms in other climes look like innovation here. If aman tells his friend or wife that he wants to take a lifepolicy, the response would be that he just wanted towaste his money, and if he had no use for it, could hegive it to them who can use it better, rather than“dash”an insurance firm! Also, relative to the popula-tion, very few people here take life policies. Apart fromthat, the closest the ordinary man comes to the insur-ance sector is when he buys a car; it is only in Nigeriathat some people buy brand new cars and take outthird party covers for them.

The businessis expected togrow with thepassage of the

oil and gaslocal content

policy, as localinsurers areexpected tounderwritemuch of it

Sovereign TrustInsurance Plc hasextended its

Corporate SocialResponsibility efforts to theInternational Institute ofTropical Agriculture (IITA) onthe reforestation projectrecently embarked upon bythe Institute.

In a statement madeavailable to Vanguard, thecompany said that the focusof the project is to promoteconservation of the secondaryrain forests in the country,monitor the bio-diversity ofthe nation’s vegetation. It willalso create awareness on theneed to protect the remainingsecondary forests at local,regional and national levels.

The Principal Consultant forthe Project, Deni Brown, said“The reforestation project setsout to restore the secondaryrainforest and to plant onapproximately 300 hectares ofdegraded land usingindigenous trees”.

According to her, thetropical rainforests support thegreatest diversity of livingorganisms on earth.Rainforest deforestation has adevastating impact on bothflora and fauna. She reportedthat as far back as 1995,Nigeria had lost over 56 percent of its rainforests and

Report suspicious transactions,NAICOM urges insurers

Stories by ROSEMARY ONUOHA

The National InsuranceCommission, NAICOM, hascharged insurers to always

report suspicious transactions to theCommission in line with the AntiMoney Laundering/CombatingFinancial Terrorism, AML/CFTdirective.

The Commission described suspicioustransaction to be premium paymentabove N1 million for individuals andN5 million for corporate organisations.

Assistant Director (Inspectorate),Head AML/CFT Unit of NAICOM, Mr.Sam Onyeka, who gave the charge,said that insurers should always lookat the possibility of fraud and takeprecaution because the worldenvironment has become so bad thatunderwriters must do something toprotect themselves.

Onyeka who said that insurers mustdo it for their business to survive notedthat the Commission have informationthat people transfer funds from abroadthrough brokers, agents who use suchfunds to buy security.

He said “If a broker said you can’thave access to their clients and somedocuments then send suspicioustransaction report to the Commission.”

Onyeka said that brokers don’t filesuspicious report to NAICOM onlyinsurers do, so the insurers must makesure that brokers collaborate with themstating, “The way to protect yourself isto send alert because there could beproblem someday.”

Onyeka said that any insurer that isnot ready to abide by the directiveshould close shop stating “For so longin Nigeria we have left what we aresupposed to do. We cannot continue towait. We have to leap frog so that wecan do other things.”

Onyeka added that policyholderidentification otherwise called “KnowYour Customer (Policyholder)requirement is probably the mostimportant requirement and underpinsall anti-money laundering proceduresand that companies are required toobtain satisfactory evidence of identityof all proposers while the evidence

must be satisfactory from bothobjective and subjectivestandpoints.

He said “Where it appearsthat the applicant is acting foranother person, it is requiredthat the company should takereasonable measures toestablish the identity of the

principal. Companies shouldtake reasonable steps to findout the identity of their client,and they are able to establishthat the client is who he claimsto be only when there issufficient evidence of hisidentity.”

STI supportsreforestation project

deforestation continues at arate of 3.5 per cent perannum. Currently, only 9.6million hectares remainunaffected by deforestation;which invariably is less than10 per cent of the total landarea in Nigeria. Going by thisfigure, Nigeria has thehighest deforestation rate onthe planet and this isconsidered highly dangerousaccording to experts. Hence,the need for a proactivemeasure as expounded in thereforestation project.

The Head of CorporateCommunications and BrandManagement of SovereignTrust Insurance Plc, Mr.Segun Bankole stated thatCommunity development andenhancement is one of theplatforms on which theorganisation’s CorporateService Responsibility ishinged upon. He said thedeforestation rate is quitealarming and if positivemeasures are not urgently putin place, the country might beworse off for it. According tohim, the companyunderstands clearly the needto have a safe and habitableenvironment which informedmanagement’s decision tosupport the reforestationproject.

Pix from left Ms Foluke Aboderin, Executive Director, Corporate Banking, Ecobank Nigeria; Eng Hu-sein Labo; Managing Director, Power Holding Company of Nigeria (PHCN); Mrs Olusola Oworu, Com-missioner for Commerce and Industry, Lagos State and Mr. Jubril Aku, Managing Director, EcobankNigeria at the Ecobank Nigeria’s Customer Forum and Launch of Ecobank OMNI in Lagos. Photo byLamidi Bamidele

Vanguard, MONDAY, MAY 14, 2012 — 41

Economy

Brief Perspectives

The global financialmeltdown which started

from the US, in 2006 as a resultof the glut in the mortgageindustry, spread like acontagion to Europe, Asia, andthen to the emerging marketsin Africa, including Nigeria.That ill wind got to Nigeria in2008 and no stock market wasspared of the catastrophicmeltdown, just like the Greatmarket crash of 1929. Eventhough it was a global financialmeltdown, the Nigerian marketwas insulated until about 2008.The effect was mainly in thebanking sector. This is becausebanks account for about 60% ofthe listed securities. Therefore,whatever affects the bankingsector has profound impact onthe market capitalization. It isa known position that theNigerian Stock Market hasbeen slow to recovering, afterthe Global Financial Crisiswhich hit the global stockmarkets, commencing from theUS mortgage industry andother corporate entities.Furthermore, I wish to statethat the stock market is cyclicalwith boom and burst periods.This is normal in all stockmarkets. However othermarkets are now movingupwards while the Nigerianmarket is still southwards. Inorder to have a thoroughunderstanding and a holisticposition of the current problem,it will be absolutely necessaryto briefly outline the primarycauses of the down turn andthereafter suggest remedialactions that will help to haltthe freefall of the market;restore investors’ confidenceand prevent further losses tothe investing public.

Between January 2000(when I became the Director-General) and December 2008,there were a lot of positivedevelopments in the NigerianCapital Market as exemplifiedby activities and transactionsboth in the primary andsecondary market of theNigerian Stock Exchange. Inemphasis, issuers of securitieshad a ready market. The markettruly lived up to its functionsas a more prudent financingwindow for individual,corporate, state, federal andforeign investors. Apart fromenjoying the benefits of thefunction of the market as afinancing window, Federal andState Governments in Nigeriaalso benefited enormously fromthe boom in the market through

,

,

The Nigerian Stock Market: Strategies forrecovery, rebound and practical bailout options

tax revenue, enhancedemployment opportunities andtransaction fees that went to theSecurities and ExchangeCommission (SEC) as theGovernment regulator of thecapital market.

During the period(performance measurementintroduced); MarketCapitalization of the NigerianStock Exchange rose fromN800 million in Year 2000 toN13.3 trillion at the beginningof 2008; The All-Share Indexhit an all-time High of58,990.22 basis points in 2008from 100 points in 1984 when Iintroduced Index in theNigerian market; Annualcapital raised by companiesand Government on the StockExchange rose to the peak ofN2.8 trillion at the end of 2008.All of this was as a result of acombination of factors,including experienced andeffective Stock Exchangeleadership. There were a lot ofnew entrants – issuers andinvestors alike; local investorsand foreign investors. Therewas investor confidence andthe Middle Class re-emerged...in Nigeria.

Margin Loans by Banks

The indiscriminategranting of margin loans

by the banks to all manners ofinvestors and market operatorscaused the market bubble. Thisis similar to what happened inthe US mortgage industry.Margin loans by themselvesare not bad, because they helpto create more liquidity in themarket, globally. However, inthe case of Nigeria, the banksgave out these loansindiscriminately, and in mostcases insisted that such marginloans were used to purchasetheir own shares. Some banks

were deeply involved ingranting margin loans thatwere not properly structuredand this created excess cash inthe market, and the shareprices got bloated. TheNigerian Stock ExchangeManagement at severaloccasions WARNED market

Exchange. The truth of thematter is that most of theissuers of these privateplacements MISLED thepublic via the style of placingand also wanted to list theirshares at very high premium,instead of listing at the pricesthe securities were issued. TheManagement of NigerianStock Exchange objected andrejected any attempt of listingany shares above the price theywere issued at privateplacement offer. The NSE tookthis stand so as to protectinnocent investors who wouldbuy the listed shares at thesecondary market level. TheNSE took this step because itnoted that immediately afterthe listing; the directors andofficers of the issuingcompanies are usually the firstto off-load their holdings,while they deliberatelywithhold the release of sharescertificates to other subscribers.For all intents and purposesthis is market manipulation onthe investing public. The NSEdoes not regulate Registrars ofcompanies (SEC does);however persuasive advisorywas at different times advancedby NSE against the practice of

Companies) a crime, the proofof insider trading is usuallyvery difficult to establish andprove, therefore the law needsto be revisited to make it moreeffective. This is a crime that isnot easy to establish even inthe more advanced stockmarkets. As a criminal offence,the standard of proof is “Proofbeyond reasonable doubt”.This is a very ‘tall order’ formarket regulators the worldover, therefore somejurisdictions have shiftedemphasis from criminalisingmarket insider dealinginfraction to “market abusemodel” which emphasises civilliabilities and theencouragement of voluntarycompliance with the marketlaws, rules, regulations,practices and conventions.

Public Offering byBanks

Following CBN directivesto banks to capitalise

from N2billion to N25 billionas minimum share capital,almost all banks utilized andaccessed the capital market toraise funds. Within two years,many of the banks besiegedthe capital market falling overone another to raise fundsthrough mega offers in asingle tranche. The bankscompeted in mopping up everyliquidity from the stock market,thus crowding the market. Atotal of about N2.2trillion wasraised through various publicoffers dominated by the banksin 2008, via Listing on theNigerian Stock Exchange.

Divestment by ForeignPortfolio Managers

This is another factor thatseriously contributed to

the continuous fall of theNigerian Stock Market. Manyforeign investors that alreadyhad troubles in their homeeconomies pulled out of theNigerian Stock Market leadingto dumping of shares beyondthe ability of domestic investorsto absorb.

The way out / forwardFor the market to recover and

start moving upwards, I wishto professionally suggest thatthe following palliativemeasures be considered forimplementation. The NigerianStock ExchangeTransformation Document2010-2015 which the Council,Management and Accentureworked on 2008-2010 containsthe solutions for our capitalmarket to bounce back. Thesynopses are as follows:Federal GovernmentIntervention via AMCON /Ministry of FinanceIncorporated.

Only direct physical injectionof funds can change thedirection of the capital marketjust as AMCON did for theMoney Market. No amount of“Workshops and Discussions”will avail.

operators, that Regulators i.eCBN and SEC had not issuedGuidelines on Margin Loans.Subsequently, it became quiteevident that the margin loanfacilities had been abused.However, they are off balancesheet items, not easilydetected. (CBN/SEC recentlyissued the Guidelines onMargin Loans).

Numerous UnlistedPrivate Placement, IPOs.

Another factor militatingagainst the Nigerian

stock market’s rebound is theproblem of unlisted privateplacement issues. Severalcompanies undertook privateplacements which were NOTLISTED ON the NigerianStock Exchange. This hadnegative effect on investors’confidence, because many ofthe subscribers bought theshares with the hope that theywill be listed on the Stock

issuers using their in-houseregistrars and issuing housesfor their public offers.

The problem of unlistedprivate placement of sharescan be solved if SEC (whoapproves private placement)compels all the companies tolist those shares at the pricesthe shares were issued, or at amarginal premium, because ofthe time value for money. Thiswill bring some respite to themarket and will enhancemarket capitalization, inaddition to boosting investor’sconfidence. If not, the issuersmust be made to refundmonies to investors, withinterest.

Insider dealings

The above connotation isa well known practice in

Stock Market the world over.Although S.111 (1) and (2) ofISA, makes Insider Trading (byDirectors of Quoted

By PROF. NDIOKEREKE-ONYIUKE

•Okereke-Onyiuke

There were a lot of newentrants – issuers andinvestors alike; local investorsand foreign investors. Therewas investor confidence andthe Middle Class re-emerged... in Nigeria.

42 — Vanguard, MONDAY, MAY 14, 2012

Unless we stop thisnonsensical andn e e d l e s s

controversy about the AsabaAirport, we run the risk ofmissing FDI which it isdesigned to attract and theemployment opportunities itwill provide. The world iswatching us. Read on.

To state that Foreign DirectInvestment, FDI, is a globalscarce resource eagerlypursued by all nations andeven sub-sections of countriesis to state the obvious. Itsmajor benefits include, but arenot limited to, employmentgeneration, economic andsocial development and, even,technology transfer.Increasingly, as the globalvillage shrinks in scope,thanks to advances in ICT andaviation, investments inaviation have become one ofthe leading areas for businesspeople, even as the landavailable for constructingairports is also dwindlingworldwide. TheEnvironmental ImpactAssessment studies that haveto be undertaken and themore stringent safetyrequirements for the locationof airports have made it moredifficult to build them; as theneed for them multiplies. Thereason is simple.

Air travel saves time and,although most people don’tknow this, time is an economicresource very much at par withcapital, labour, and rawmaterials. The Far Easterncountries, led by theJapanese, pioneered theconcept of Just-In-Time, JIT,delivery of raw materials,components and other inputsto manufacturing andconstruction sites and effectedsubstantial savings ininventory management,warehousing costs associatedwith rent, losses andpilferage. The back bone ofJIT was air cargo which madeit possible for partsmanufactured in one plant tobe available at another plantwithin hours – not days as wasthe case before.

The Japanese, the SouthKoreans and Taiwanese

exploited that strategicadvantage for decades untilthe rest of the developedworld caught on to the game.Now, the Chinese are doingthe same thing. Sub-SaharanAfrica remains the only regionof the world where rawmaterials are trucked overthousands of miles to bedeposited in warehouses formonths before being put onthe production line. We runtwelfth century plants in the

BRIEFS FDI: Our own worst enemy(Asaba Airport as case study) — 1

twenty-first century and hopeto compete with the rest of theworld.

Nigerian manufacturerscannot practice JIT for manyreasons, which will beexplained later and thataccounts for the almost totallocation of all manufacturingand commercial activities inLagos. Why site your plant inAkwa Ibom or Kogi or Tarabawhen all your raw materialsand components land atApapa Wharf in Lagos andhave to be trucked inland overuncertain roads and safearrival is not assured – letalone Just-In-Time. Thegrowing population explosionoccurring in Lagos State ispartly a result of our refusalor failure to encourage thedevelopment of air cargo fromairports based inland whichcan then promote the growthof manufacturing for light

weight items numberingmillions in virtually everystate of Nigeria.

The recent development ofairports at Gombe and Uyoand, now, Asaba, to add toBenin, Warri, Portharcourt,Enugu, Owerri and Calabar,in the fastest growing regionof Nigeria – the South Eastand the South South hasopened up enormousopportunities in this regard,which, incidentally, had beennoticed by foreigners morethan Nigerians. In fact, theAsaba airport is the last piecein jigsaw puzzle revealing acluster of airports which canbe reached very quickly andeasily irrespective of take-offpoint.

Interest is developing; somuch so that a group ofinvestors asked me to conducta survey of the airports forthem to determine which isthe best for their venture. Ilanded at all the other airportsin the cluster several times inthe past; but I still visited themall. The only one, and the lastto visit was the Asaba airport.Half an hour after arriving at

the airport, it was clear to methat this is IT! This is theairport that will meet all therequirements of the investors– if only it could be made toaccommodate bigger aircraft.I arrived at this conclusionwithout consulting any officialof the Delta State governmentand without any attempt oropportunity to look into theissues now generatingcontroversy. The idea was todetermine first if this airporthas potential to attract foreigninvestment and it does. Areport was filed to that effectin March and I was asked toobtain more information fromthe Delta State governmentabout the future developmentof the airport and the timetable for each phase ofdevelopment. Everything wasgoing smoothly, I waspersuading the potentialinvestors that Asaba is viable,even though I am from LagosState and will never beemployed there. But, I know

that the venture will generatethousands of jobs and that isall that mattered to me.

Suddenly, a controversyhad erupted about the

leveling of “some ant-hills atN7.5 billion” as the criticsallege; and the nervouspotential investors arefrantically asking me: Dele,what’s going on? From mypoint of view, what is goingon is quite clear. We areallowing a needlesscontroversy, “a tempest in atea pot”, to jeopardizeinvestments at the airport thatwill eventually dwarf the N7.5billion reportedly spentleveling the ant-hills.

To begin with, it is doubtfulthat any government, Delta ornot, will spend N7.5 billionjust to level ant-hills. Politicalopponents of governmentsalways exaggerate thecorruption attributable to theparticular government.Truths, admittedly, areprovided; half truths, notoften are added; and outrightlies top the bundle of what isoffered to the public. That istrue irrespective of party in

power and who constitutes theopposition. Ask PDP or ACNmembers about Mimiko inOndo State and you wouldconclude that the man shouldbe shot on sight. Turn to Edoand ask the same question ofPDP about Oshomhole andthe fellow deserves to beguillotined. That’s politicsNigerian style. But, when theissue at stake is long termeconomic development ofNigeria, a region, a state oreven local council, the mediapractitioner must be totallynon-partisan whencommenting on anycontroversy. So let me start bytaking on the issue of N7.5billion spent to “level a fewant-hills” just becausePresident Jonathan wasexpected at the BRACEDSummit at Asaba. The way Iunderstand it those “few ant-hills” presented a hazard tothe landing of the President’saircraft in Asaba. The otheroptions were Benin (130 kmaway); Enugu (125 km away),Warri (130 km away),Owerri(165 km away); Portharcourt(over 200km away) by road.Who in his right senses wouldsuggest that the President ofNigeria should travel thesedistances by road. He had toland in Asaba; it was assimple as that. And, atwhatever cost to us. Unless,of course, anyone isbroaching the idea that heshould not respond to the callof the “hands that feed thenation”.

For the umpteenth time, itneeds to be repeated that

I never voted for Jonathan; infact I campaigned againsthim. But, by overwhelmingmajority vote, he was elected.That is a fact which nobodyin his right senses will deny.That election had raised a lotof demons in the polity whichare threatening, not only theeconomy, but the unity of thecountry as well. Given thatscenario, the only person whocannot or should not die, byany means, today in Nigeriais President Jonathan.Anybody else can die. Hisdeath, through carelessness,on our part, or the deliberateactions of terrorists willplunge this nation into suchturmoil that within the firsttwo days of the occurrenceNigeria would have lost overN1 trillion. So, if the DeltaState government haddecided to spend N7.5 billionto safeguard Jonathan’s life,to me, it was cheap insurancepolicy. That is not supposedto mean that I believe that thecost of the project could nothave been less. But, all thingsconsidered, Jonathan,wherever he goes, from nowuntil 2015, is insurable forN7.5 billion or more; anytime,anywhere and any day.

Brick mouldersappeal for linkroads in Makurdi

Burnt Brick MouldersAssociation in Makurdi,

Benue, on Thursday appealedto the state government torehabilitate the access roadsto the Agboghuul BusinessCommunity to boost theirproduction. Mr IornonguAtsue, the Chairman of theassociation, told the NewsAgency of Nigeria (NAN) inMakurdi that the memberswere not producing optimallydue to the deplorable roads.Atuse said that thegovernment would generatehigher revenue from thebusiness community if itprovided the community withbasic amenities. Apart fromthe large sales from blocks,there are other businessesthat are carried out here suchas the production and sale ofstones, sharp sand andothers. “The government willrake in huge revenue in formof taxes and levies on suchbusinesses by simplyproviding regulatoryguidelines on the conduct ofthe business at the sites.

SWAN urgeswomen on nationaldevt

BY PROVIDENCE OBUH

To further minimize thelevel of poverty in the

Nigerian homes, the society ofWomen Accountants ofNigeria (SWAN) has called onthe Nigerian women toengage in active labour, toaccelerate nationaldevelopment.

SWAN Chairperson, Mrs.Tokunbo Adegbola who spokeduring a Lunch in Honour ofthe 47th ICAN President said,“The ordinary Nigerianwoman out there should seeherself as a citizen that hasright and exercise that right,these are the right to live, theright to work, the right to doeverything that a man does.

“She should not be inhibitedby being a married woman, donot say because you aremarried to one man, that mancan seat on your lap, No! Tellthe man that with two workingit is better than one working,do not fight him, because wedo not encourage fighting, butyou must let your spouse knowthe benefit of two hands ratherthan one hand.”

Asked about the society,Adegbola said the society ofwomen Accountants is thatsection of the Institute ofChartered Accountants ofNigeria (ICAN) that is mainlywomen.

Vanguard, MONDAY, MAY 14, 2012 — 43

ICT

By PRINCE OSUAGWU

President and CEO ofEricsson, Mr HansVestberg has peeped

through the Ericsson crystalball, and predicted that twotechnological revolutionswould change the worldbetween now and 2016.

However, Vesteberg was notjust predicting. He hasstatistics which he hasfollowed religiously and iftheir antecedents are to berelied upon, the future couldhardly do without them— thetechnology deployment andinstallation revolutions.

For him, these two systemswould change the waytelecommunications servicesare delivered in the nearfuture.

Vestberg made thedisclosures exclusively toVanguard in Ghana recentlywhen he visited the Sub-Saharan Africa to preachpreparedness for new waysof delivering services in linewith new and emergingtechnologies.

From his explanation, thedeployment phase looks atwhat kind of infrastructurecould be deployed in the nearfuture, while the installationphase, deals with a periodwhen consumers wouldnaturally use technology indifferent ways than they areused to.

The implication of theserevolutions is that only thosewho understood theirdynamics, tailor servicestowards them would be inbusiness within the periodunder review.

Vestberg was so emphaticon these revolutions perhapson the back of his company’slong history of shaping thefuture of worldtelecommunications industrythrough research anddevelopment, R&D. Ericssonhas distinguished itself as aclear leader in thet e l e c o m m u n i c a t i o n sinfrastructure business notonly for the efficiency andreliability of its equipmentand services but also due toits ability to predict the futureand prepare operators aheadof time.

According to Vestberg,Ericsson spends a whopping8 billion dollars every year inResearch and Development,R&D, to clearly understandthe dynamic and changepattern of technologies that

‘Two tech revolutions’ll changethe world in 2016 ‘

govern thetelecommunications industry.

He threw up some statisticswhich have ruled thedynamics of the industry forover a century and painted apicture of why Ericssonrecently rolled out the multi-million dollar project taggedNetworked Society. Theproject is aimed at usheringin a new era wheretechnology would enablemore people to interact,innovate and shareknowledge in whole newways and creating a dynamicshift in mindset. Ericssonwould like to see a worldwhere more people areempowered, more businessesliberated and the society moreconnected than ever.

Statistics that shapedtechnology revolution

In Vestberg’s statistics, “ittook some 100 years to get

1 billion fixed lines but it took24 years to get 5 billionmobile subscriptions. Lastyear end, there was about 6billion mobile subscriptions inthe world. 85% of thatpopulation are on mobilecoverage.

“If you take that and thinkabout what will happen in thenext five years, then you willhave mobile subscription inthe world, come up to about 8billion. Now the most

important point in thesefigures is that consideringthat about 500 million peopleon earth today are on fixedbroad band while that ofmobile broadband is 1 billion,in 2016, if the fixedbroadband will grow, it wouldnot be much, but in line withtrend of growth, the mobilebroadband will growtremendously”.

“Lets also remember that thenetworks that are carryingthese services were based onvoice. Apps, data, smartphones were not intendedwhen these networks werebuilt, but in 2016, the networkwill be in total change andthat is what we calltechnology revolution. It hastwo phases. First is thedeployment phase, whereinfrastructure is deployedand the other is installationphase, when consumerswould use technology indifferent ways”.

Benefits of the revolution

Every revolution bringswith it a change and the

two revolutions Vestbergpredicted would alsointroduce a couple of changesin service delivery andconsumption from what isobtainable at the moment. Forinstance, the consumers willchange in the way they usephones. 26 percent of timeused on phone would be forvoice call while 74 percentwill be for data relatedusages. This is in sharpcontrast to, for instance, thepast three years, where 90%of time spent on phone wasvoice call and 10% was forSMS and data.

The Ericsson boss said thatthe revolution wouldtransform education in a waythat in the next ten years fromnow, printing books will nolonger be in vogue. Alsogiving the broad spectrum ofcoverage, speed and datapossibilities, digitalhealthcare would be possibleand this would transformhealthcare and make it

•Hans Vestberg

,

,

are common.For every 10% of broadband

penetration, 1% goes to GDPand for every 100 connectionsyou get 80% new jobs. Then,if you have 1000 penetration,you have higher impact andthis applies to all countries.

You can now see howimportant Networked societyis in the need to transformour people’s behaviouralpattern, transform enterprisesin the society, using thetechnology infrastructure.That possibility is what weforesee. It fuels our belief thatif by 2020, there is going tobe about 60 billion connecteddevices in the world, thenanything that will benefitpeople, needs to beconnected.

Of course, when the societyis connected, the ICTindustry lives up to its name.That is what we call anetworked society.

What preparations for thisnew networked world

Ericsson is building moreinfrastructure and morenetworks around the world.Majority are based on latesttechnologies to accommodatethe new order.

Already, roughly, 40% ofmobile infrastructure in theworld is on Ericsson trafficand still we are building moreand upgrading those othersthat need lateststandardization.

Don’t forget, we spend 8billion dollars in Researchand Development, R&D,every year to understand allthe networks that will be usedin the future.

We designed technologiesthat help operators offerservices on health care, theconnected calls, onlinegaming, big time informationmanagement among others.

The place of emergingmarkets in all these

We use the samestandard of

technology in the wholeworld. We sale the sametechnology in Africa in US andthe unique thing is that wecan bring down the cost wherewe think is important to theworld. So, Ericsson has 2G,3G patterns in the world. Thatmeans that we are relevant.First we have to maintainstandards so that we cancontinue to supply the world.We are the biggest mobileinfrastructure providers foroperators in the world.

Another area we arerelevant is that we also runnetwork services. Roughly80% of Ericsson turnover isfrom installation, integration,consultation, running mobilenetworks, fixed networks foroperators. We are providingthe back_ up tools foroperators to carry on whatthey do.

What to expect in 2016

Between now and 2016 isjust about 4 years away,

yet, Vestberg was alsoconfident to posit that aboutthree times of people thathave access to internet todaywould be broadband users.“We expect 25 billionbroadband users by 2016which is a huge leap. Today,about1.8billion people haveaccess to internet and 92percent of population willhave mobile coverage.

affordable to more people.

The place of NetworkedSociety in the new revolution

Networked society isimportant in every bit

of the revolution because itwould enable anything thatwill benefit from connection,to be connected. We took from400 different studies in 2010from universities, academia,business, to look at what theimpact of broadband is, andcame up with two things that

Already, roughly, 40% ofmobile infrastructure in theworld is on Ericsson trafficand still we are buildingmore and upgrading thoseothers that need lateststandardization.

44 — Vanguard, MONDAY, MAY 14, 2012

People in Business

,

,

Mr. Frederick Ohiaeri is the ManagingDirector/Chief Executive Officer of

62:15 Associated Industries Ltd. and itssubsidiary, 62:15 Healthcare Ltd. In this chatwith Vanguard in his Lagos office, the graduateof medical physiology from the University ofPort Harcourt speaks on his business, thechallenges and how he has been coping.Excerpts:

According to Mr. Frederick Ohiaeri, hecame to Lagos a few years ago with thedream of making it big in life even if it

means working himself to death to actualise all

Drive is veryimportant inbusiness– Ohiaeri

By EBELE ORAKPO

his dreams.To be successful in life,

Ohiaeri believes that drive isthe most important ingredient.

“Drive, for me, is somethingthat makes a plane that haslost all its engines to still bein the air; a car without fuelstill running; something thatmakes a man whose legs andhands have been broken in afight to keep fighting. A lot ofpeople will say these thingsare impossible but what drivedoes is that it makes whatpeople consider impossiblepossible,” he said, adding:“Some businesses with verystrong human capacity andexperienced people hadcollapsed while some thatstarted from the scratch bypeople who are consideredinexperienced and with noeducational background, hadsurvived because of drive.

“For a lot of people, drive isusually rooted in a lot ofthings. Some people’s driveis rooted in the fact thatsomebody said to them that‘look, you cannot make it inlife. You cannot amount toanything; you are useless,’ orsomeone may be less-privileged as a result of onecircumstance or the other, andpeople say to him: ‘look, thatkind of dream is not for you,it is for people whose parentsare wealthy,’ and he wants todefy all that.”

I had an idea:“After graduation, we were

supposed to go for NYSC butthe letter did not come on time,so, we spent one year at homebecause the school had someissues.”

Instead of whiling away histime, the author of This isLagos, decided to get himselfbusy while waiting for thecall-up letter. “I got a jobwhich I did for a while andthen there was this idea that

been posted to Oyo State. Inever knew that Ibadan wasin Oyo State so I came toLagos and asked a cousinwhere Oyo State is and hesaid: ‘are you not just comingfrom Ibadan? That is thecapital of Oyo State.’”

Call it divine arrangementbecause not only was heposted to Oyo State, but hisplace of primary assignmentwas close to the match factory

so he was able to conduct hisresearch while doing his youthservice.

“I had a concept of how morevalue can be added to safetymatches because the industryfrom my research, producesless than two per cent of allthe safety matches used inNigeria and the rest is beingimported. It is a huge marketin the sense that it issomething that everyone useseveryday. So I was wonderinghow we can be importing about98 per cent of something thateverybody uses everyday, andyet, we claim there is high rateof unemployment. What is theproblem of this country? Ibrought a lot of ideas on howthis safety match can be soldthat can actually attract peopleto buy it and create jobs. So Idid the research and kept it inmy locker and surprisingly,the CBN said they wantedpeople with genuine businessideas. I did not attend theprogramme but somebody whodid, mistakenly dropped thepaper on my bunk so when Iwoke up and saw it, I read it,immediately, my project cameto mind,” he said.

“One of the things that reallygave me a boost in terms of myconfidence in myself waswinning the CBN award whileI was serving. That awardmade me realise a lot ofthings, that actually if youprepare on time and plan forsomething, it is always easierfor you to hit it head on.”

Decisive moment:“After youth service, I expected that I

would go back to Port Harcourt, it wasreally a decisive moment for me. Ilooked at Lagos from different angles.Talk about the five richest people inNigeria, the five biggest churches, thefive biggest politicians, they are all inLagos so why am I going anywhereelse? It has to be Lagos. But I toldmyself that ‘look, if it means strugglingand dying in Lagos, let me struggle,”he noted.

Ohiaeri said that one thing thathas worked for him is hisdetermination to make a difference,to stand out wherever he foundhimself and it has paid off.

“I built a market base for myselfbefore I left the companies where Iworked. So up till today, it is themarket base that is sustaining mebut the thing is that a lot of peoplecomplain when they see challengesbut I was running af ter thechallenges because I knew theywere opportunities for me to do

something.So today, I’ve built

something on thoseopportunities that I had in thepast. And I believe stronglythat 62:15 AssociatedIndustries will be ahousehold name in thiscountry and in West Africa.”

Initial capital: “When I wanted to start off

on my own, frankly speaking,if I had any money at thattime, it probably was aboutN200,000. I took a very bigrisk that a lot of peoplewouldn’t have taken. I didnot have up to five per centof the funds I needed. Ifeverything had gone wrong,I would have started all overagain, I would not have givenup.

In fact, nobody gave me achance. They all said I wasgoing to flop. And to be veryfrank with you, all theiranalyses were realistic but Idid not want to listen tothem. I told myself that evenif I failed, I would try again.I’ll keep trying until Isucceed.

A lot of fr iends that Ibegged to join me at thattime said to me: ‘Do youknow how much it costs toimport drugs?’ Luckily forme, I had companies thathad pharmaceuticalproducts but did not havemarketing strategies. Someof them came to me andgave me their drugs andasked me to build a marketfor them and I did.Someone f i rs t gave medrugs worth over N1.6m tosell and return the money.While I was doing that,another personrecommended somebodyelse who did not haveenough market. I boughtmy first car, bought thesecond and third cars andstarted employing people.And here we are today,” heenthused.

Ohiaeri said he wil lrather be master of hisdestiny than a slave inparadise. “If I lose I lose,if I win, I win but I willkeep fighting till I die andlet it be told that I foughteven if I did not succeed.”

He said theunwil l ingness of somecustomers who buy drugson credit to pay af tersel l ing; governmentpolicies which sometimesaffect cost of doing businessand lack of electr ici tysupply, are some of thechallenges they face.

On the future of thecompany, Ohaeri said: “Inthe next five years, I expectto be the best in my field.In the pharmaceuticalindustry where I am, Iexpect to be a force to bereckoned with.”

just popped into my mind. Iam the kind of person thattakes a lot of risks. So I quitthe job and went to do someresearch on the idea. Howeverything came together issometimes surprising and Ifind it very difficult tounderstand. I took theremaining money I had andtravelled in search of a safetymatch-producing company.Somebody told me there wasone in Calabar so I went thereand there was none. I went toOnitsha but there was none.My money had almostfinished and I came to Lagosand there was none too. Sosomebody told me to go toIbadan. I went to Ibadan andluckily for me, I found one.On my way out of Ibadan, Igot a call that the NYSCposting was out and I had

A lot of people complainwhen they see challengesbut I was running after thechallenges because I knewthey were opportunities forme to do something.

•

•Ohiaeri

Ohiaeri...I expect to be the best in my field

Vanguard, MONDAY, MAY 14, 2012 — 45

Appointment & Promotionsvicahiyoung@yahoo.com

BRIEFSAregbesolaexplainsphilosophybehind OYES

GOVERNOR RaufAregbesola of Osun

State has said the Osun YouthEmpowerment Scheme,O’YES is his administration’sresponse to the previousinsensitivity to the plight ofthe teeming youths in the statethat had remainedunemployed.

Speaking during theactivities marking the oneyear anniversary of thescheme in Ede, Aregbesolaaccompanied by GovernorKayode Fayemi of Ekiti State,lauded the programme as acommendable initiative totake the country out of itsunemployment difficulties.

He argued that anyforward-looking governmentanywhere in the world wouldinvest in the youths for a bettersociety and that the youthswere the essential agents fornation building.

According to him,“Investment in the youth isone of the primary duties ofany forward-lookinggovernment. Youths representthe reality of today and thepromise of tomorrow; they arethe great agents of change;the essential blocks for nation-building.

Ekiti moves torevamp moribundindustries

EKITI StateCommissioner for

Commerce, Industries andCooperatives, Mr. RemiBodunrin, has said efforts areon to revamp some moribundindustries in the state.

Bodunrin told the NewsAgency of Nigeria, NAN, inAdo-Ekiti that the initiativewas in fulfillment of theelectioneering promisesof Governor Kayode Fayemi toindustrialise the state under hiseight-point agenda.

The commissioner, who saidthe Ikun Dairy Farm had beenleased to a private company,noted that the investor hadalready earmarked N400million for commencement ofoperations.

Bodurin also said governmentapproved N500 million torevamp the Ire-Ekiti BurntBricks Industry while Odu’aGroup of Companies wouldpartner it in the exercise.

According to theCommissioner, the first of thethree phases of the projecthave commenced. •Shonubi, NIBSS new MD/

CEO

...Ajao, Onyejekwe appointed EDs

THE Board of Directors ofNigeria Inter-Bank

Settlement System, NIBSS, Plchas appointed Mr. FolashodunShonubi, the company’s newManaging Director and ChiefExecutive Officer, CEO.

The electronic paymentsand settlement company, alsoannounced the appointment oftwo executive directors,EDs; Mr. Ezekie l A jao ,Executive Director,Technology andOperations and Mrs.Christabel Onyejekwe,Executive Director, BusinessDevelopment.

The Board said these“appointments constitute aclimax of the transformationproject of NIBSS, and thecompany is now poised morethan ever before to play its roleas a financial market shared-service infrastructure, withstrong potentials for effectivecollaboration with otherstakeholders towardsactualising the cash-less Lagosand cash-less Nigeriainitiatives.”

Shonubi holds a master'sdegree in BusinessAdministration as well as inMechanical Engineering, fromthe University of Lagos.

He is also a resourcefulInformation Technology-drivenbanker with over 19 yearsprofessional experience.

Prior to this appointment,Mr. Shonubi was ExecutiveD i r e c t o r , I n f o r m a t i o nTechnology and Operations atUnion Bank of Nigeria Plc; amember of the Board of UnionH o m e s a n d D i r e c t o r ,Information Technology andCorporate Services inRenaissance Securities NigeriaLimited, with responsibility for

Shonubi now MD/CEO of NigeriaInter-Bank Settlement System

the group’s IT infrastructure inAfrica.

Between 1999 and 2007, heworked in MBC Internationalas Deputy General Managerand supervised their IToperational platforms. Heserved in First City MonumentBank Limited as Vice-President, and in EcobankNigeria Limited as ExecutiveDirector.

Mr. Shonubi also had a stintwith Citibank Nigeria Limitedas its Head, TreasuryOperations (1990-1993) andserved on a number of sub-committees of the Bankers’Committee.

M e a n w h i l e ,Mr. Ezekiel AJao, the newExecutive Director,Technology & Operations,NIBSS; attended theUniversity of Ife (now O.A.U.),and graduated with CombinedHonours in Computer Scienceand Economics.

He holds an M.Sc. inComputer Sciences from theUniversity of Lagos, MBAcertificate of O.A.U., andattended the AdvancedManagement Programme ofthe Lagos Business School in2011. He taught ComputerScience and Mathematics atOgun State University between1986 and 1989, and has servedas Associate Lecturer at theUniversity of Lagos and OfficeSupport Systems Managerat AIICO Insurance Plc.

He joined Gulf Bank ofNigeria Ltd as a pioneer staffin 1990 and later movedto Societe GeneraleBank where he rose to becomeAssistant GeneralManager (IT), before leavingfor NIBSS. Ajao joined NIBSS

Plc as Deputy GeneralManager in 2001 and rose tothe position of GeneralManager, Operations – aposition he occupied beforethis appointment.

While at NIBSS, he has ledthe implementation ofseveral industry projectsnotably - Nigeria AutomatedClearing System, NIBSSElectronic Funds Transfer,Nigeria Central Switch, andthe Cash-less Lagosinfrastructure project.

Mrs. ChristabelOnyejekwe – ED, BusinessDevelopment is a professionalbanker who has held variouspositions in the Nigerianbanking industry.

She holds an LLB Hons.from the University of Lagosand BL Hons from Nigeria LawSchool, and an MBA certificatein Banking and Finance.

Onyejekwe started herbanking career in First Bankof Nigeria PLC and peaked inUBA PLC as a GM with over20 years of core bankingexperience.

CHIEF Executive Officer,CEO, West Africa,

Renaissance Group(Investment Banking), MsYvonne Ike, has beenappointed into the Board ofGuinness Nigeria Plc, as anon-Executive Director.

Ms Ike’s appointment wasannounced at theBoard meeting of thecompany recently.

The appointment is withimmediate effect.

Ike holds a Bachelor ofScience Degree inEconomics. She started hercareer as an auditor withErnst and YoungInternational and has beenan FSA registeredrepresentative since 1994.She was a ManagingDirector at JP Morgan,where she spent 15 years ofher career until 2009. Ms.Ike is an internationallyregarded investment bankercredited with pioneering anumber of ground-breakingtransactions in West Africaregion.

She has more than 18years experience infinancial services, includingcapital market operationsand fixed-income,derivatives and equitiesproducts. Over the course ofher career, she has ledsenior teams in New York,Geneva, Hong Kong,Nigeria and South Africa.

She is presently the CEOWest Africa, RenaissanceGroup (InvestmentBanking).

The Board also accepted theresignation of Mrs. IfeomaMafeni from the Board ofDirectors of the Companywith effect from 13 April 2012.

Until her resignation, Mrs.Mafeni was an ExecutiveDirector (Human ResourcesDirector) of the company; herresignation was to enable herpick up a role as the DiageoHuman Resources Director ofAfrica Regional Markets.

The appointment of Mrs.Mafeni to her new role isrecognition of her sterlingachievements while she wasthe Human ResourcesDirector in Guinness Nigeria.

Her impact in this role hasbeen significant, havingspearheaded major progressin the company ’s talentstrategy, partnered inbuilding a powerfulleadership team and createda high performing HRfunction.

Ike, WestAfricaRenaissanceGroup CEO,joinsGuinnessNigeria Board

*Managing Director, Mohinani Group, Anil R. Mohinani and Director, Kasapreko, GideonOsei-Amoako (middle), exchanding the Sonnex and Kasapreko agreement; GM Operations, Kasapreko, Ghana, Kojo Nunoo; President, Sonnex Packaging Nigeria Ltd, Sandesh Gossaviand Special Adviser to Lagos State Governor on Housing, Hon. Jimoh Ajao at the signing ceremony between Kasapreko and Sonnex at the Somotex office in Lagos.

46 — Vanguard, MONDAY, MAY 14, 2012

Media & Advertising

BRIEF

Vanguard, MONDAY, MAY 14, 2012 — 47

Mr. David Okeme, Brand Building Director, Unilever Nig Plc, Mrs. Nsima Ogedi- Alakwe,Category Manager Savory, Nollywood Actress, Omoni Oboli, Mr. Thabo Mabe, ManagingDirector and Mr Yemi Adeboye, Corporate Relations Manager, Unilever Nig. Plc during thelaunch of the new Knorr Seasoning Powder.

Brands that reflect, liveand adapt, earn the right

to survive over time. Brandsthat project themselveschange the rules and thefitness landscape.

Managing brands directionrequires connection that ispurposeful to that idea.Purposeful in the sense thatevolution allows a brand toadapt to changing wants and

Knorr steps up growththrough brand extension...unveils knorr in Powder form

Stories by PRINCEWILLEKWUJURU

needs without losing its corerelevance in movementforward.

That was why the companysaid it decided to come withthe variants becauseconsumers want a better life.That is what they are doingas a company and as a brand.We are now improving ourbrand for a better tomorrow.Why we are doing this, is tobring health to the Nigerianconsumer.”

Since Unilever Nigeria Plc

took over the manufacture andsale of Knorr seasoning fromCadbury in 2005, there’s beenoverturn in the seasoningmarket.

Battle in the seasoningmarket had been fought andsome seasonings losing asizeable proportion of theirmarket share, and some hadcontinued to extend theirbrand portfolio and othersonly enjoyed generationalvalue in the market.

According to Gamble in

1987, “Brands extension is onthe increase. “When brandswish to enter markets fromwhich they have been absent,(which is not the case withUnilever’s Knorr) companiesuse the name of one of theirbrands.”

The introduction of Knorrpowder seasoning; Stew andSoup variants are a goodexample of brand extension,using the existing Knorr cubebrand to drive sale for the newproducts or using it to hold asegment of the market.

According to Thabo Mabe,Managing Director ofUnilever Nigeria Plc, at theunveiling of the brand in thefront of a capacity Knorrconsumers speaks theacceptability of the brand ashe said that the company isunveiling the brand in adifferent way based on thestrategic agenda of creatingbetter life everyday and year

However, before thelaunching of the products, thecompany had a walk referredto as the ‘Green Walk’, whichthe Managing Directorcorroborates with thelaunching, which he said wasabout driving health and“most importantly makingconsumers life easier.”

Mabe said that cooking hasbeen made easier with thenew Knorr powder variants.Whilst stating that consumerscan now enjoy cooking. “ Weare now making life easier foreverybody. We are bringinghealth credential as a cornerstone of our brand.

Continuing, he said,“Whatever we do in ourdevelopment, innovation, inour research is based on ourconsumers request. We dothings to satisfy ourconsumers , we don’t dothings to copy what otherpeople are doing. We look atour consumers and we canproudly say we understandour consumers.”

In a system where theeconomic power of

Nigerians are dwindlingevery day, the only remedy isto look for an alternative wayto ameliorate their suffering.This, Nigerian Breweries Plcis doing through the LegendReal Deal Promo. The desire of Mrs. OyinadeOlushola this year was to owna bigger generator. But,already had a small capacitygenerator, referred to as “Ibetter pass my neighbour”, itwas not adequate for herbusiness as a food vendor whoalso caters for outdoor events,a bigger generator is surely anecessity. She finally gotwhat she desired when shespotted a Legend crown corkin the on-going Legend realdeal promo.Reacting to her win, she said:“They sell beer near my shop.I had heard about this promo,but I did not believe it wasreal. “I was just walkingalong the street and I found

Promo: We are taking empowerment from another angle—NBthe crown cork on the floor.Something told me to pick itup and I did. The next thing,I looked under the crown corkand I found out that I had wona generator, I was so happy,”she said.Olushola added that thegenerator will boost herbusiness. “I will use it athome and for my business. Isell food, and I also cater forevents. Now I can carry thegenerator everywhere,” shesaid.When Mr. UmeokekeBonaventure decided to takea bottle of Legend Extra Stout,he felt reluctant to open thecrown cork. But recalledprevious occasions when hehad tried, nothing happened.This time, something didhappen! Bonaventureopened the crown cork andfound that he had won agenerator, he screamed. “Youdon’t need to ask me how Ifeel, when this reporterqueried him, he said, of

course I feel great and cannotdescribe how I feel in words,”he replied, when asked toexpress his feelings. He said:“It was the first bottle ofLegend Extra Stout that I tookand I didn’t want to open thecrown cork. You know whenmost companies introducethese promotions nothingoften happens. I have triedseveral times, but this time Iam lucky.”Bonaventure furthercommended this reporter viathe phone, which, accordingto him t was timely; as his oldgenerator was being fixedduring the time of the call.Speaking on the promo, Mr.Funso Ayeni, Senior BrandManager, Legend NB Plcstated: “Part of the reasons forembarking on this promo is tosay thank you to ourcustomers. Legend ExtraStout is today Nigeria’s fastestgrowing stout brand and weachieved this enviable status

because of their support.” Ayeni revealed that winnersof the generating sets and 32inch TV screens have theoption of having their prizesdelivered to their homes ifthey so desired. On theinitiative, he stated: “We wantto make our consumers ascomfortable as possible,hence the option of havingthe 32 inch TV sets andgenerators delivered to theirhomes, at the expense of NBPlc.”Ayeni stated that the brandresolved to explore thecashless route to enableconsumers claim their moneywith ease. He said: “We putthe safety of the consumers aswell as proprietors of ourdesignated redemptioncentres into consideration,hence, the decision to use thecards. He added that thelucky cash winners can onlywithdraw the money thriceusing the ATM terminals.

Nigeria’s advertisinglandscape received a

boost recently when C23, amedia and IT firm, incollaboration with D BannerAfrica, a mobile media station,launched a digital banner,designed to boost the consumerbase of low and large scalebusinesses in the country.

Speaking, DamolaAkindolire, Managing Directorof C23 at the unveiling inLagos, said that the newproduct is introduced as away of making indooradvertising signage anaffordable opportunity forbusinesses to thrive.

‘The future of advertising isin the digital signage, themarket is currently a bit static and because of that we decidedto take indoor advertisingsignage into the next level bymaking d-banner an affordableopportunity for smallbusinesses and services to theright consumers,’ these werethe words of Akindolire whenhe explained that theinnovation is a product ofdeep research, a digitalplatform that allows forinteraction and bluetoothenabled.

He stated that the companieswould be unveiling 100 d-banner platforms across thecountry witiin the next 12months, while 40 would belaunched in Lagos in the nexttwo quarters in Lagos, sinceLagos represents the hub ofadvertising.

‘D-banner is affordable,cheap and the most effectiveway to reach consumers in ahard market like this, whereeverybody is fighting for amarket space. It is a platformthat both small and bigbusinesses in Nigeria canreach out to their consumers,irrespective of the locationsand that is why we havepractically selected thelocations that are displayingthese banners. Among themare the airports and majorshopping malls in Lagos.

The Managing Director of DBanner Africa, Ese Okotie,described the product,invented in the UnitedKingdom, as an incorporationof the roll-up banner with thedigital screen.

‘It can be set up in threeminutes. Advertising has reallygone so far, so what we aredoing is not catching up, butgetting others to catch up withus,’ he added.

He explained that theproduct is already being usedby the likes of Disney andBBC,Chrysler and other superbrands around the globe,adding that the company’sdecision to partner with C23was informed by the need tohelp the nation’s advertisingmake the benchmark for brandowners.

D-BannerAfrica, C23boost digitaladvertisement

48 — Vanguard, MONDAY, MAY 14, 2012

In the light of the ongoingconstitutional amendment

by the National Assembly towhittle down the perceivedexcessive powers of the apexbank in the CBN’s 2007 Act, weconcluded last week in thiscolumn that the issue of goodgovernance will not depend onwhether the Chairman andDirectors of the apex bank wereexternal directors. On the otherhand, we suggested that anappropriate evaluation of theperformance of the CBN couldonly be made against thebackground of its primeobjective/mandate, whichinvariably is maintenance ofprice stability!

We noted that on the groundsof available evidence, i.e. forexample, inflation projected toapproach 15% by the end of thesecond quarter, the inordinatelyhigh cost of borrowing andminimal access to funds to thereal sector, and a weak naira inthe face of increasing dollarrevenue deepening poverty inNigeria, we may rightly concedethat CBN has failed in deliveringthe expectations of its primemandate. We concluded thatthere was no basis for Nigeriansto expect improved socialwelfare or any form of reductionin the rate of unemploymentunder the CBN’s currentoperational and monetaryframework.

Incidentally, the currenthearing by the House ofCommittee on the capitalmarket, curiously, does notbeam any investigative light onwhy the CBN also enjoysunfettered administrativeindependence and fiscalautonomy, which precludesbudgetary approvals or indeed,any form of supervision oroversight by the NationalAssembly, as is currently thepractice with other ministriesand parastatals.

Indeed, stories of hugeleakages and extra fiscal cashmovements from the CBNabound in our economic historyin the last 30 years. Forexample, we recall thedisappearance of $12.8bn oilwindfall from the federaltreasury some years back; wealso recall the substantiatedallegations of Abacha’s directaccess to hundreds of millionsof dollars from the Central Banktreasury; former PresidentObasanjo also made ‘illegal’incursions into the treasury topay the London/Paris Clubs debtas well as for huge contracts inthe power sector, without priorapproval from the NationalAssembly.

The way things stand, so longas the power for appointment ofthe Central Bank Governorresides solely with thePresidency, it will be difficult toprevent such executive foraysinto our treasury. On its refusalto submit its budget andadministration for scrutiny andapproval by the NationalAssembly, CBN, on its own side,has taken protection underSection 6(3)(a) of the 2007 CBNAct, which states that its Boardof Governors shall be solelyresponsible for theconsideration and approval ofthe annual budget of the bank.

The House Committee,however, may rightly feel thatCBN’s position is a deliberatemisinterpretation of Section6(3)(a) of the CBN Act. Indeed,if the budgets and performance

Omoh Gabriel - Group Business EditorBabajide Komolafe - Acting Finance EditorClara Nwachukwu - Energy EditorPeter Egwuatu - Head, Capital MarketYinka Kolawole - Snr Bus. Correspondent

Favour Nnabugwu - Insurance CorrespondentGodwin Oritse - Maritime CorrespondentGodfrey Bivbere - Maritime CorrespondentYemi Adeoye - Energy CorrespondentOscarline Onwuemenyi - Energy CorrespondentFranklin Alli - Industry ReporterMichael Eboh - Capital Market Reporter

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Naomi Uzor - IndustryProvidence Obuh - Capital MarketLAYOUT - Graphics Department

The putrid mess also in CBN! (2)

,,

of all government agencies,including the Presidency, areconstitutionally subject toNational Assembly approval, itbecomes inexplicable that theoperations of any arm of theexecutive could be excludedfrom such scrutiny andapproval.

It becomes more worrisomeif the exempted agency is notonly the custodian of ourtreasury and national wealth,but also the agency responsiblefor ensuring, the creation of anenabling environment thatwould galvanise employment,industrial regeneration, withimproved social welfare andincreasing employmentopportunities in line with itsmandate.

It is equally dangerous thatthis same government agency isalso capable of committingNigerians to an expensive debttrap without recourse toalternate evaluation andapproval from any superior

constitutional authority. Forexample, it is not clear ifPresident Jonathan recognizesthat it is reckless for hisgovernment to pay up to 15% forits risk-free sovereign debts,when even distressed Europeaneconomies such as Spain stillborrow at less than 4%! Mr.President would be hard pressedto rationalize why we should paysuch a high cost for borrowingtrillions of naira that even theCBN openly admits would onlybe kept idle in vaults andaccounts records. The CBN andits associate agency , the DebtManagement (read as DebtCreating) Office haveunilaterally rapidly increasedour national debt portfolio byabout 500% in the last five years,with a collateral debt servicecharge of over N500bn; i.e. over10% of the 2012 expenditurebudget.

So, it will be difficult to faultthe House of Reps for seekingmore transparent informationand some measure ofsupervision of the CentralBank. The way things are, it isnot clear if the staff salarystructure and other emolumentsenjoyed by Central Bank staffare in consonance with federalcivil service structure.

The CBN on its part hasfurther expressed its financialand administrativeindependence in ways, whichhave raised questions on probityand accountability; forexample, the N50m donation byformer CBN Governor to somemembers of National Assemblyto support their oversightfunctions on the banking subsector a while back.

More recently, the incumbentGovernor has similarly madedirect donations of millions ofnaira to victims of the BokoHaram bomb blasts in Kano andMadala in Niger State, and overN1bn has also been madeavailable by the apex bank forrevamping facilities in someNigerian universities. Thevalue of such CBN donations inthe public domain exceed N1bn,and one wonders what the totalbudget of the CBN for itscorporate social responsibility(CSR) actually is. Critics havenoted that even if such acts ofCSR were appropriate, the CBNwould have been better advisedto make the donations throughgovernment agencies properlyempowered with responsibilitiesfor such activities.

The writer has on the platformof the Freedom of InformationAct sought information from theCBN on critical issues,,particularly with regard to itsmonopoly in the foreign

exchange market and theindustrially destabilizingimpact of its easy dollar policyto bureau de change. The CBNhas characteristically shunnedour request for any suchinformation.

However, I must say that

successful amendment of the2007 CBN Act may notnecessarily guarantee efficientdelivery of CBN’s core mandateof price stability. In otherwords, the amendment of theAct, may not deliver theexpectation of minimal inflationbelow 3%, or lower cost ofborrowing below 5% or indeed,reduce the rate ofunemployment, neither will it

lead to improvement ininfrastructure and socialwelfare.

Regrettably, also, the CBNmay not do any better in itssecondary role of bankingregulation and supervision. Nigerians have witnessed atleast two major banking sectormeltdowns in the last sevenyears, and on each occasion, theCBN had stepped in to refloatthe sector with huge cashinjections. It is not generallyrecognised that such funds werebasically deliberate expansionsin money supply largelysupported by printing morenaira, without minding thecreeping inflationary impacts ofsuch action on the economy, andthe reduction in the purchasingpower of all income earners,particularly that of the poor.

Ultimately, for the joy ofinflicting such pain on thepeople, the few bank proprietorsand management (who do notenjoy the patronage of theincumbent government) will geta mere slap on the wrist aspunishment and before you sayJack Robinson, it will once againbecome business as usual. Curiously, the apex bank, whosegross failure to entrench globalbest practice in the supervisionand regulation of the system,invariably, always walks awaywithout any sanction for whatsome critics would describe astheir criminal negligence. Onthe individual level, there is noevidence in the public domainof any form of disciplinaryaction against any CBN staff fortheir role in the rape of thebanking system in the lastdecade, but its board membersand directors have been quick topoint fingers as in KingsleyMoghalu’s presentation at theongoing capital market hearing,which decried manipulation bystakeholders as the cause offailure in the banking sector.

The expectation created afterthe last banking meltdown bythe same Moghalu, who iscurrently CBN’s DeputyGovernor Financial SystemsStability, that CBN would returnto clean out its own stable afterit has sanitized the bankingsector, was certainly intended tobe a joke! How can anyone relyon the same set of management,who brazenly presided over thewell-acknowledged putrid rot in

the system to expose their ownfailure to act responsibly inpolicing the banks to createclean and lean bankinginstitutions?

In the following three articlespublished in this columnbetween 2007 and 2008namely; “Banks and FraudIncorporated” and “Banks andMoney Laundering 1&2”,weendeavoured to show that theabuses of uncollateralisedloans, insider trading, bogusfinancial reporting, share pricemanipulations and the resultanthuge values of non-performingloans had not only becomemanifest for over four years, butthat the regulators of thebanking and financial systemand the special financial fraudsquad, EFCC had publiclyacknowledged the prevalence ofserious banking infractions andevidence of collaboration in thelaundering of public funds by thebanks all this while.

The big surprise is theinexplicable lack of will on thepart of these guardians andprotectors of public trust in theseinstitutions to act decisively. Indeed, in addition to the articlesreferenced above, themalfeasance in the bankingsector had been graphicallycaptured in other pieces such as“Banking of Public Funds,Corruption and Double Speak”(published 7/4/09), “WhoseMoney is Soludo Playing With,Anyway?” (18/04/05), “TheBonanza in Margin Trading” (8/09/08), “Bogus Liberalisation =Capital Flight” (3/04/06) and“CBN Stop this Nonsense” (17/04/06) all of which can beaccessed at www.lesleba.com.

The degree of malfeasance inpossibly all the banks was somind-boggling that it is difficultto claim that they escaped CBNvision . When this piece wasfirst published in 2009, we calledfor a thorough investigation todetermine why CBN officers andtheir colleagues in theSecurities and ExchangeCommission and the NigerianDeposit Insurance Corporationseemed to have turned blind eyesto the shenanigans in thebanking sector until the adventof Sanusi.

We had also advised that ifSanusi were truly desirous ofstarting off on a clean slate, hewould need to examine thecircumstances surrounding aCBN advert which gave a cleanbill of health to Intercontinentalbank less than two monthsbefore Lamido’s auditinvestigation revealedotherwise. The questions are,on what indices/information didthe former CBN Governor makehis declarations; whorecommended this course ofdeliberate misinformation andwho paid for the full page advertcarried in several papers. Allthese questions have remainedunanswered.

It is instructive that soon after

his exit from the apex bank, theformer Governor was soon ableto finance an obviously deeppocket campaign for the top seatin the government House inAnambra State from hispersonal savings!

SAVE THE NAIRA, SAVE

NIGERIANS!

Ultimately, for the joy of inflictingsuch pain on the people, the fewbank proprietors and management(who do not enjoy the patronage ofthe incumbent government) will geta mere slap on the wrist aspunishment and before you sayJack Robinson, it will once againbecome business as usual.

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