Minister of Finance, Dr. Ngozi Okonjo-Iweala  

Nigerian maritime and insurance industries may have lost over N20 trillion in the last two and half decades due to bad shipping policy operative since 1986. This amount represents two trillion yearly.
The loss is attributed to the carriage of the country’s crude oil on Free on Board (FOB), which has denied indigenous shipping and marine insurance companies of the accruable foreign exchange earnings.
Maritime experts said with the FOB terms, buyers of Nigeria’s crude oil are responsible for arranging shipment of their purchase, against the Cost Insurance and Freight (CIF) which requires the seller to arrange goods to a port of destination and provide the buyer with the documents to clear them.
Dr. Alex Okwuashi, Rector of Certified Institute of Shipping of Nigeria (CISN), lamented that Nigeria has lost some N2 trillion every year, saying the change to CIF by the Federal Government would immediately enrich the portfolio and balance sheet of Nigerian shipping sector.  He explained that this would also create new opportunities for the country’s ailing insurance firms through freight earnings.
Okwuashi noted that the clause in the 1986 Shipping Policy that the Nigerian National Petroleum Corporation (NNPC) must sell its crude oil on FOB basis “has led to capital flight and poor capacity building of the country’s shipping sector. The government ought to have introduced CIF since.”
He advised the Central Bank of Nigeria and Federal Ministry of Finance to issue guidelines to back up the government’s decision in the next fiscal year. The CISN rector said CIF should be the 2013 incoterm, a term of trade which explains the responsibility of importers and exporters in the international trade. The National President of Nigerian Institute of Freight Forwarding (NIFF),   Dr. Zebulon Ikokide, said no Nigerian shipping company could lift crude oil because of poor government policy in the sector. He observed that Nigeria was not trading on a balanced economy, noting that the introduction of the new term of trade will improve the country’s economy tremendously.
“If Nigeria operates on CIF, the insurance companies would be revived; they would be able to insure cargo lifted here to other countries,” adding that the new policy “should extend to cocoa rubber and other agricultural products.”  The push for change of the trade term came from the 15-member committee inaugurated in July, 2012, by President Goodluck Jonathan. The committee, mandated to draw up a roadmap for effective maritime operations in the country, had the Minister of Transport, Senator Idris Umar; and former President of the Nigerian Chamber of Shipping (NCS), Mr. Olisa Agbakoba, as Chairman and Vice Chairman respectively.
DailyNewswatch

The Action Congress of Nigeria (ACN) has said Nigerians need no ’marking scheme’ to assess the Jonathan Administration or any administration at all, noting that the people know when a government has impacted positively on their lives.

In a statement issued in Ibadan on Thursday by its National Publicity
Secretary, Alhaji Lai Mohammed, the party also reminded President Jonathan that it is not the business of the opposition to spoon-feed his Administration on how to govern, even though the party has, time and again, gone out of its way to proffer solutions to the myriad of problems facing the nation, out of
sheer patriotism.

President Goodluck Jonathan with Ondo State PDP candidate Chief Olusola Oke during the PDP Gubernatorial rally held in Akure. Photo: State House.
”Needless to say that such suggestions from us and other well-meaning groups and individuals have been so arrogantly ignored by the administration,” it said.

ACN wondered why President Jonathan is suddenly irritated that Nigerians have not given his administration a pass mark, after about three years in the saddle and two years since he was elected.

”Mr. President, Nigerians need no marking scheme to know that the rate of unemployment went up, under your watch, to an unprecedented 23.9% by December 2011, according to figures given by the National Bureau of Statistics. Today, the figure must be hovering above the 50% mark!

”Mr. President, Nigerians need no marking scheme to know that under your watch, security of lives and property, as well as the welfare of the citizens – the raison d’etre of any government – are at the lowest ebb. A day before you
demanded a marking scheme from Nigerians instead of giving them better life, a popular musician was attacked by a nine-man gang that snatched his car and deprived him of his money in the country’s economic capital city - the fate being suffered daily by millions of your compatriots!

”Mr. President, what marking scheme does one need to know that despite the seemingly impressive economic figures being reeled out by your administration, the average Nigerian is worse off today than he or she was before you assumed office? What we are seeing is growth without development. The so-called 6.5% economic growth announced by your Finance Minister is meaningful only on paper. How does that help the thousands of university graduates who are scrambling to work as truck drivers? How does it make Lagos-Ibadan expressway or the East-West road safer for Nigerians?

”Mr. President, what has been the impact for Nigerians of the high foreign reserves figure and the stable exchange rates for the naira reeled out by your Finance Minister? Is it not a cruel irony that as Mr. President was luxuriating in phantom economic indices on the second anniversary of his administration,
Nigerians across the land could not even watch him on television because the power situation has been exceptionally poor in recent times?

”And in case Mr. President thinks it is only the opposition and the media – his administration’s favourite whipping boys – that are scoring his administration low, the Washington-based global advocacy and campaigning organization, ONE, was listing Nigeria – under President Jonathan’s watch – and DR Congo among ”laggard countries” pulling Africa back from reaching the MDG goals by 2015? Surely, this global body did not use any ’Jonathan-style marking scheme’ to name Uganda, Rwanda, Malawi, Ghana and Ethiopia as the top performing countries in Africa (on the MDGs), even when they are less endowed than Nigeria?” ACN queried.

The party said it would not have wasted its energy on commenting on the mid-term performance record of the Jonathan Administration, had the President not disingenuously decided to blame imaginary enemies of his administration for his token achievements in the face of mounting challenges facing the country.

It urged President Jonathan to shut his ears to praise-singers, especially those of the pig-at-the-trough hue from across the Atlantic who have never seen an African government, no matter its governance record, that is unworthy of their association, as they hunt for cheap funds from despotic governments across the continent to rehabilitate themselves back home.

”Mr. President, it is never too late for you to put your shoulder to the wheel, shun the political jobbers around you, reinvigorate your cabinet by chasing away the deadwood there – though some of them come highly recommended on paper – and giving Nigerians a more purposeful governance.

”When that happens, Mr. President, you will not need to waste valuable time on lecturing your much-sapped compatriots on how to assess your administration, and you would have succeeded in rending those seemingly implacable critics of yours in the media and the opposition jobless,” ACN said.
The Vanguard

The Asset Management Corporation of Nigeria, AMCON, will not sell any of the three bridged banks, Keystone Bank, Mainstreet Bank and Enterprise Bank, to a core investor who will not preserve employment, says the Managing Director/CEO, Mr. Mustafa Chike-Obi.

Speaking during his visit to Vanguard’s Head Office in Lagos, Chike-Obi described as false the rumour that FirstRand had expressed interest in acquiring Enterprise Bank, but later withdrew from the deal, saying that FirstRand did not at any point express interest in buying Enterprise Bank.

He noted that besides job preservation, he would also be looking for investors that would offer the most attractive price for the banks.

He stated that soon, announcement would be made on the new management of the depots AMCON took over from some of its debtors, including Zenon Oil.

Chike-Obi said: “From my point of view, I want two things. The best price I can get and the person that will keep the most jobs. That is what I am going to be asking. If somebody offers me N100 billion and they are going to fire all the staff and somebody offers me N80 billion and they are going to keep all the staff, I will take the N80 billion and keep the staff.

“The issue of ‘fit and proper’ is Central Bank’s issue. Whoever buys the bank has to be approved by the Central Bank as you know. So, the Central Bank has to approve the person as fit and proper owner of the bank because that is a regulatory issue”.

On the speculation that some South African banks, including Firstrand expressed interest in Enterprise Bank, but later withdrew, Chike-Obi said: “It is only FirstRand by the way, not South African Bank.

“FirstRand always wanted to buy Keystone Bank. They have never been interested in Enterprise Bank. They have come to me and say they want to buy Keystone Bank and I said, ‘wait till the end of the year.’

“When we announced Enterprise Bank first; they of course said they don’t have interest in Enterprise Bank because they never were. So, the whole story of how South African banks were interested and they are no longer interested is completely false. It is only FirstRand, and the only bank they are interested in is Keystone. They are not interested in anything else, they are interested in Keystone and when it comes to Keystone, you will see them there,” he assured.

Waivers on loans purchased

On granting interest waiver on loans purchased from the banks, he stated that the law does not permit the Corporation to waive interest on loans, adding that both the cost for acquiring and maintaining such loans must be recovered in full.

He said: “What the law tells us is that if you buy a loan for N1, and it costs us another Naira for interest and all other things, we must recover all our cost plus our cost of maintaining it. That is what the law requires.

“We have a policy in AMCON that there is always a difference between the outstanding amount and what AMCON pays because AMCON does not believe what the banks say in the first place. So, if the bank says it is N100, we may pay N40 first.

“The law obliges us to recover that N40 plus the cost of acquiring it. That’s the interest cost; we must do that. Our guideline generally, is that nobody can recommend something less than 100 percent of that.

“We try to get more, but we cannot get less than that. So, we don’t waive interest and we do not waive cost of acquiring loans from what you said, but if a bank has a loan of N100  and sells to me for N40, it is the bank that is going to lose, because the bank made N60 loss. I paid N40 and I want to recover N40 plus interest. That is the policy.”

Reason for sale of Enterprise Bank first

Chike-Obi further explained that the Corporation took the decision to sell Enterprise Bank first because it is the cleanest and most attractive of the three Nationalised banks.

The AMCON boss said: “I think Enterprise Bank is the most attractive. It is the smallest, it is the cleanest, it has the fewest branches, it has fewest issues, and I think it is always best to start with the simplest and learn from the process so that when you get to the most complicated, you must have learnt a lot of stuff out of that.

“We will sell Enterprise first, we will see how it goes, we will see what we will learn from the process, we will refine the process and we will go to the next one, which is likely going to be Mainstreet Bank by the way, not Keystone”.

Political manipulation

The AMCON boss insisted that that the Corporation was not influenced by any politician in the manner it recovers and restructures loans, saying that he does not have any political leaning.

Chike-Obi maintained that some evasive politicians that were accusing AMCON of having political leanings and influence were some debtors that are used to borrowing money from banks without paying back.

He said; “I am not interested in politics; these people owe us and I am only interested in getting my money back. I say give me my money back and you start complaining about that. For instance, Great Ogboru’s outstanding debt is about N3 billion. We paid over N617 million because we agreed that some of these things could be suspicious. Now, we are asking him to pay back the N617 million, not the N3 billion and he said he won’t pay. Look, we have 13,000 loans.

“We are not subject to any political interference. The president of Nigeria, who technically is my boss, because he appointed me, has never asked me to do anything for anybody.

“I talk to him frequently and if he doesn’t ask me to do it, nobody will because I always ask him, ‘This thing they are asking me to do, is it with your permission? So, they now know that I will ask him. So, nobody, not the Minister of Finance, not the CBN governor, nobody has ever asked me to do anything improper. People complain and they will come and say ‘This person has complained, look into it.’

“I know people bash Jonathan depending on their political will, but he has never asked me to do anything improper as the MD of AMCON. Not one,” he emphasized.
Vanguard

CBN Governor, Sanusi lamido Sanusi

Governor of the Central Bank of Nigeria, Sanusi Lamido Sanusi, was yesterday awarded the accolade of Central Bank Governor of the Year, by the African Banker Awards.
The award, which has now been won thrice by Sanusi, according to a statement, was in recognition of his outstanding work in sustaining banking reforms.
The statement noted that Sanusi has also “ensured macro-economic stability, protected the independence of the Central Bank and enhanced many aspects of the Nigerian Banking including adoption of new technologies for financial inclusion; continuous modernisation and more transparent disclosures.”
The Award Committee also said Sanusi “ has been continuously singled out by many of your central banking peers, international bankers, investors and development partners as a reformist governor with integrity, candour, energy and exceptional courage.
“There is no doubt that Africa’s improved reputation today is in large part owed to the achievements of leaders like you, and IC Publications as well as our event partners wholeheartedly cherish your exceptional contribution to the economic development of the African continent.”
Sanusi was recently awarded the accolade of Central Bank Governor of the Year, Sub-Saharan Africa, by the global business magazine, Emerging Markets.
The African Banker Awards now in its 7th edition, is designed to promote entrepreneurial excellence and world-class practices in banking and finance in Africa. They honour achievements in financial institutions and individuals who have contributed significantly to the reform, modernisation and expansion of the continent’s banking and financial system.

Champions League winners Bayern Munich has taken over as the most valuable football brand in the world from Premier League club champions Manchester United.
The 2013 list compiled by British company Brand Finance values the Bundesliga club at 860 million dollars – 23 million dollars more than United.
The News Agency of Nigeria, quoting a report from dpa says Real Madrid, valued at 621 million dollars, is ranked third, with fellow Spanish giants, Barcelona fourth, valued at 572 million dollars.
Five Premier League clubs are in the top 10, with the other five places belonging to two German clubs, two Spanish clubs and AC Milan.
The nation

Boko Haram leader, Abubakar Shekau

LEADER of the violent Islamic sect, Boko Haram, Abubakar Shekau, on Tuesday claimed in a video that Nigerian soldiers had retreated from the ongoing military offensive against terrorism and that insurgents had sustained little damage, AFP reports.

The video marks the first public comments from Shekau since the military offensive which started on May 15 following the declaration of emergency rule in the stronghold of the sect, Borno, as well as Adamawa and Yobe states.

Shekau also reportedly called for foreign Islamists to join the fight against Nigeria in the video which AFP claimed was in its possession.

The AFP reports thus: Shekau’s whereabouts cannot be determined in the video, in which he is shown seated while dressed in camouflage with a turban, an AK-47 at his side.

His comments contradict statements from the military, which has claimed much success during the offensive, including the destruction of Boko Haram camps and dozens of arrests.

It has been impossible to verify the claims of either side independently, with the military having cut mobile phone service in much of the country’s northeast and access to remote locations restricted.

“Since we started this ongoing war which they call a state of emergency … in some instances soldiers who faced us turned and ran,” Shekau said in the hour-long video.

Nigeria's Chief of Army Staff, General Azubuike Ihejirika

He claimed Nigerian forces “threw down their arms in flight.”

He called on like-minded Islamists in countries including Afghanistan, Pakistan and Iraq to join the fight to create an Islamic state in Nigeria.

“We call to us our brethren in these countries I mentioned. Oh! Our brethren, come to us,” he said in the video, which alternates between Arabic and the Hausa language spoken across northern Nigeria.

The video later purports to show vehicles and weapons seized from Nigerian soldiers.

Shekau, designated a global terrorist by the United States last year, repeats earlier statements that Boko Haram “will not stop the kidnap of your women and children until you set free our women and children, and our brethren.”

He also says Boko Haram’s goal is either the creation of an Islamic state or “martyrdom”.

The video was delivered to AFP through an intermediary in a manner similar to previous Boko Haram messages. The images of Shekau in the video are consistent with those previously released.

Nigeria launched the offensive against Boko Haram after President Goodluck Jonathan declared a state of emergency in three states in the country’s northeast, the Islamist insurgents’ stronghold.

Several thousand troops were deployed and fighter jets hit alleged Boko Haram camps.

On May 20, the military said it had re-established control in five remote areas of the northeast where Islamist insurgents had seized territory.

It had also claimed the arrests of 120 suspected insurgents.

The military’s latest statement says 25 insurgents were arrested and three killed during operations at the weekend, including one identified as “Abba” named on a most-wanted list. One soldier was also killed.

“Troops of the special forces have intercepted messages sent to fleeing insurgents urging them not to give up but fight to the end.

“The attempt by some of them to heed the call was foiled during the weekend as they were trailed to some settlements and towns towards the border where they plan to regroup,” the statement explains.

Last week, the military said it had freed three women and six children abducted by Boko Haram.

Nigeria’s government has also pledged to release certain suspects held in connection with the insurgency as a peace gesture, including all women and children.

Boko Haram has waged its insurgency since 2009, with an estimated 3,600 people left dead, including killings by the security forces.

The group has pushed for the creation of an Islamic state in Africa’s most populous nation and largest oil producer, though its demands have repeatedly shifted.

It is believed to include various factions with differing aims.

Nigeria’s military has come under heavy criticism over its response to Boko Haram, including allegations of extra-judicial killings, arbitrary arrests and unlawful detentions.
The Punch

Minister of Trade and Investment, Mr. Olusegun Aganga

The Federal Government on Tuesday said it had saved about N300bn since it started encouraging production of cement in the country.

The Minister of Industry, Trade and Investment, Mr. Olusegun Aganga, disclosed this to State House correspondents after a meeting convened to discuss how private sector players could take over the government’s shares in the Onigbola Cement Factory, a joint venture between Nigeria and Benin Republic.

Apart from the sum saved, Aganga said the government had also succeeded in creating about two million jobs and increased the country’s foreign reserves since it stopped issuing licences for the importation of cement in 2012.

“The importation of cement came down for example because no importation at all in 2012.  It saved us N300bn. Textile and vegetable oil imports have also fallen by at least 56 and 52 per cent, respectively,” he said.

Aganga faulted reports of alleged shortfall in cement supply, saying all the factories were capable of producing 26.28 million tonnes of cement if they are working in full capacity.

The production figure, he said, was higher than current demand for the product.

He said, “In fact, for the first time ever, we are exporting cement outside Nigeria, so that is a major achievement. In fact, if we need to supplement that again, this company that I was talking about in Benin Republic, even though the capacity is only 500,000 metric tonnes, it is actually importing to the northern part of the country a limited amount.

“So, the supply is there and that is what that policy has achieved since 2002. In 2002 we were producing two million metric tones of cement; today it is 28.6 million metric tonne. For the first time in 2012, the Federal Government did not issue any import licence for cement in this country, I did not.

“In the course of that, we have saved the Federal Government at least N300bn in what would have been used, and that contributed to the significant fall in imports in 2012.

“In terms of trade numbers, Nigeria’s import also fell by 43 per cent, indicating a dramatic fall compared to previous years since 2005.

“What it meant is that import came down from about N9.5tn or thereabout to about N5.3tn. What that means is that we have saved about N4.2tn that has gone to increase our external reserves. So, when you see reserve building up, that is one of the reasons.”
The Punch

Uncertainties over Nigeria’s power reform programme may have further blighted her chances of attaining a key Millennium Development Goal as the World Bank at the weekend ranked the country tops among twenty other countries in Asia and Africa that currently account for about two-thirds of nations lacking access to electricity, and three-quarters of those using solid fuels—wood, charcoal, animal and crop waste, and coal to cook and heat their homes.

The World Bank report which was the first set of global data on energy access , renewable energy and efficiency  observed that about 1.2 billion people which is almost the population of India currently do not have access to electricity in the countries listed in the report.

Nigeria’s inclusion in the list may not be unconnected with her controversial power reform programme that has failed to record marked improvement more than three years after President Goodluck Jonathan flagged off the power reform Road Map in Lagos in 2010.

Though the World Bank has been actively involved in Nigeria’s power reform programme, it however feels uncomfortable with the level of progress so far recorded with transmission, generation and distribution infrastructures despite the elaborate plans that followed the unbundling of the Power Holding Company of Nigeria.

Meanwhile, the report observed that about  2.8 billion of the world population including Nigerians have had to rely on wood or other biomass to cook and heat their homes, as renewable energy only accounts for 18 percent of the global energy mix, with the largest energy savings and greatest expansion of renewables taking place in China.

The multi-agency team which produced the report compiled by experts from 15 agencies and led by the World Bank was the first of a series to monitor progress towards the three objectives of the Sustainable Energy for All initiative, launched in 2011 by United Nations Secretary General Ban Ki-moon.

The initiative, whose advisory board is co-chaired by World Bank Group President, Jim Yong Kim, is mobilizing a global coalition of governments, private sector and civil society to achieve, by 2030, its three objectives of universal access, doubled renewables and doubled energy efficiency improvement.

The Global Tracking Framework Report identifies countries with most potential to make “high-impact” progress on sustainable energy and specifies policy measures to scale up such actions.

The report puts numbers to those three objectives and identifies what needs to change where and how to do it.

“Demand continues to outpace supply of electricity which  needs to be affordable, and generated more and more in a sustainable way, and used more efficiently,” said World Bank Vice President Rachel Kyte, while launching the report.

She noted that in order to rise to this challenge and meet peoples’ basic needs and to do so sustainably, clearly requires a scale of efforts that has never been seen before.

So far about 80 percent of those without access to modern energy live in rural areas, noting that although 1.7 billion people gained access to electricity between 1990 and 2010, this is only slightly ahead of population growth of 1.6 billion over the same period. The pace of expansion will have to double to meet the 100 percent access target by 2030.

Meanwhile in order to bring electricity to that one billion plus people using conventional energy sources would increase global carbon dioxide emissions by less than one percent.

The reports finds only “modest” progress since 1990 on expanding access to electricity and clean household fuels, increasing the share of renewable energy and improving energy efficiency.
The Sun

About 14 percent of Fortune 100 CEOs received an MBA from an Ivy League school.

Brian Krzanich is either having a really good month or a really bad month, depending on how career success is defined.

After joining the technology giant, Intel, more than two decades ago, he finally became chief executive officer on May 16. His promotion came days after the company's drop on the newest Fortune 500 list — from 51 to 54 — was announced. The annual list by Fortune magazine ranks U.S. companies based on their gross revenue.

It's not uncommon for the rankings of Fortune 500 companies to fluctuate year to year. What's more predictable is that their CEOs will have an eclectic academic career.

Krzanich, who obtained a bachelor's degree in chemical engineering, is one of at least 61 top CEOs who did not get an MBA, according to a U.S. News analysis. Those who did mostly preferred Ivy League schools: Seven graduated from Harvard University, four graduated from the University of Pennsylvania, two got diplomas from Cornell University and one received the b-school degree from Columbia University.

U.S. News looked at the educational background of the CEOs from the top 100 companies on the Fortune 500 list. School data for three CEOs could not be confirmed.

Princeton University does not have a business school, but is the undergraduate alma mater for at least three CEOs on the list. Harvard had more than twice as many undergrad alums, making it the leading institution for awarding undergraduate degrees to Fortune 100 CEOs.

Of the 100 CEOs, seven graduated from law school. About a dozen received degrees overseas from Australia, France, Switzerland and other countries.

A few business executives came short of getting degrees from some of the most competitive schools in the U.S.

Lawrence Ellison dropped out of the University of Chicago and went on to become CEO of Oracle, a hardware and software engineering company. Michael Dell is CEO of the company that carries his name, which is famous for making computers, but dropped out of the University of Texas—Austin.

And Steven Ballmer, CEO of Microsoft, made it through undergrad at Harvard but didn't complete business school at Stanford University, which ties with Harvard for No. 1 in the U.S. News business school rankings.

This year's Fortune list only included eight women CEOs from some of the most prominent businesses in the U.S. Less than half of them received an MBA.

A table highlighting schools that awarded at least three degrees to the Fortune 100 CEOs is below. The rank of their undergraduate program, graduate business school and law school are also included. The table is sorted by total number of degrees awarded per institution.

Sources: Company websites, Fortune Magazine, Bloomberg BusinessWeek, Forbes, Wall Street Journal, Fox News, The White House, Arkansas Business Journal, Motley Fool, New York Times, Market Watch, Chicago Tribune, Reuters, San Jose Mercury News, Washington Business Journal, ABC News, college and university websites.

USNEWS

Reforms had saved government over N1 trillion in subsidy payments in the last one year.
The Petroleum Products Pricing Regulatory Agency, PPPRA, on Sunday in Abuja pledged to tighten its reforms in the downstream sector.
The agency’s Executive Secretary, Reginald Stanley, said this was to ensure efficiency in the importation and distribution of petroleum products across the country.
Mr. Stanley, who emphasized the importance of an efficient downstream sector, said the agency had stepped up its reforms in the sector. He said this was done with the weeding out of unscrupulous marketers in the importation of petroleum products into the country.
“We are committed to repositioning the downstream sector in line with our mandate and Federal Government’s transformation agenda,” the executive secretary said.
“When we came in November 2011, there were lots of marketers who had little or nothing to do in the system. So, we had to streamline their activities. We identified that the number of marketers operating in the sector was unhealthy. We met 128 marketers. But today, as part of the clean-up exercise, we have successfully reduced that number to 38 companies, which is good for the Petroleum Support Fund (PSF).”
He said the PPPRA had also put in place stringent measures to streamline the activities of marketers.
“Before marketers can import and claim any subsidies, they have to satisfy some conditions. These include owning a storage facility and producing all the import documents and bill of loading,” Mr. Stanley said.
The PPPRA official noted that the reforms had saved government over N1 trillion in subsidy payments in the last one year. He said the agency would continue with the reforms to ensure that Nigerians were not ripped off by dubious marketers.
“As a result of the reforms, the subsidy payment on the part of government has been drastically reduced from about N2.1 trillion in 2011 to just over N1 trillion in 2012. Also, in terms of volume, we’ve really cut down on volume from 60.25 million litres per day in 2011 to just under 40 million litres per day as of now,’’ Mr. Stanley said.
He also attributed the disappearance of fuel queues in most parts of the country to the on-going reforms and the synergy with other stakeholders in the sector.
The PPPRA executive secretary said the deregulation of the sector, if properly implemented, would fast-track economic growth and the social well-being of Nigerians.
(NAN)

Iwa Salami, University of East London, UK

As the second largest economy in Africa, Nigeria is the biggest frontier market in the continent and clearly the most influential country in West Africa, but the next momentous growth of its capital market will be driven by integration of West African markets, says an expert.

Iwa Salami of the School of Law and Social Sciences, University of East London United Kingdom, who is billed to speak at the 4th Nigeria Development and Finance Forum (NDFF) 2013 North America Conference, which will focus on ‘Nigerian Capital Market in West Africa: Opportunities and Challenges’, is expected to give practical strategies to achieve this objective.

She will also discuss regulatory and structural barriers that have to be removed for capital market integration within the ECOWAS region to become a reality.

Speaking ahead of the conference, organised by Financial Nigeria International Limited, publisher of Financial Nigeria magazine, in partnership with Nigerian Export – Import Bank, with the support of Nigerian Embassy in Washington DC, she said: “For growth in the Nigerian capital market to be effectively harnessed through capital markets integration, the domestic legal and financial regulatory frameworks need to be strengthened.

This would require strengthening financial regulatory standards in all Anglophone states of ECOWAS. It would also require effective legal and judicial systems able to enforce contract, property and insolvency rights in a timely manner.

The conference, which will assess and discuss the policy anchors of medium-term country outlook of Nigeria, will provide expert assessment on the state of the Nigerian capital market and how efforts to develop the West African regional capital market can enhance the growth of the Nigerian capital market.

NDFF 2013 conference, which will hold on 4th – 5th June, 2013 at the Washington Marriott at Metro Center in Washington DC, United States, will feature plenary sessions on Nigeria’s finance and investment climate, and targeted market policy briefings on the first day.

Salami, formerly a senior fellow at the Centre for Commercial Law Studies at Queen Mary, University of London, said: “Until about two decades ago, the Nigerian capital market had little economic significance to the economy and companies listed on the exchange hardly had any foreign portfolio investor interest. But a different picture is emerging today and the Nigerian capital market has witnessed unprecedented growth.”

 Nigeria is said to be of particular interest to investors because it has the second largest capital market in sub-Saharan Africa. The country has a growing middleclass, a stable political climate, and is evolving a strong financial regulatory environment. Nigerian companies are also being listed on global exchanges, thereby attracting foreign investors.

Other themes to be addressed at the conference include opportunities in the emerging Nigerian real estate and housing finance, security and Nigeria’s country outlook, policy framework and opportunities for diaspora investment, agricultural value-chain financing and leveraging development outcomes among others.
Businessday

The House of Representatives yesterday accused the Nigerian National Petroleum Corporation (NNPC) of deliberately slowing down the investigation into its remittance of revenues to the Federal Government.

House Committee on Finance, which has been probing Federal Government’s revenue generating agencies, has been at loggerheads with NNPC over refusal by the latter to obey summons. NNPC made N6 trillion between 2009 and 2012 as IGR but allegedly refused to remit N142 billion to the Consolidated Revenue Fund (CRF) as demanded by the Fiscal Responsibility Act (FRA) 2007.

In March, the Group Managing Director of NNPC, Andrew Yakubu, and heads of the organisation’s subsidiaries, appeared before the committee, headed by Hon Abdulmumuni Jibrin.

They have, however, shunned subsequent invitation, resulting to recurring spars between officials of the agency and the lawmakers. But yesterday, four senior officials of NNPC, led by the Group Executive Director (Finance), Bernard Otti, who stood in for the GMD, was at the meeting with the committee.

Lambasting the agency for not cooperating with the committee to conclude the investigation on its remittances, Chairman of the Committee, Abdulmumin Jibrin described as unfortunate the decision of the oil giant to adopt a time-wasting tactics .

He said delay tactics has slowed down the conclusion if the probe, a situation he said was different from other agencies. Jibrin said: “This exercise is not about the NNPC but the subsidiaries that are generating the revenue and have been making profit.

Out of the 17 subsidiaries, it is only five that has not been making profit and we want to know how the profit of the others are being spent since NNPC has been saying that it has never operated on surplus.” He stressed: “Unfortunately this delay is affecting the submission of the report of this investigation, we investigated 60 agencies and all of the them have responded, it is only NNPC that is remaining.”

“It is the opinion of this Committee that the wrong impression the NNPC is having is that they forgot that the Committee is constitutionally empowered to request for documents to aid its investigation from any entity considered necessary. “We can decided to request for information even from a unit within the NNPC and they must oblige as stipulated by the constitution”.

Besides, Jibrin opined that the subsidiaries ought to be given the opportunity to make their own case since many of them have been making profit while the parent body has been presenting contrary reports for years. “Nigerians even need to know the workings of the NNPC and all we are doing is to see how we can assist the corporation in blocking all leakages so that the revenue base of the government can be lifted”.

A member of the committee Pally Iriase regretted that the NNPC has been taking the Committee for a ride . He contended that the corporation has shown no sign of cooperating with the Committee with its attitude of stalling the investigation by always asking for more time every time. GMD (Finance) had earlier apologized to the Committee that the delay in coming up with the presentation was as a result of the absence of the officer in charge, whom he said has been out of the country for about a week.

While he also apologized for the absence of the GMD at the meeting due to his engagement elsewhere, Otti appealed for two weeks to make the presentation available.
The Sun

The National Assembly has opposed plans to privatise the River Basin Development Authorities of Nigeria.

Chairman, Senate Committee on Water Resources, Senator Lokpobiri Heineken,who spoke on behalf of the Senate, said the Federal Government could not commence the process of privatising the River Basins now.

According to him, the law establishing the RBDAs has to be reviewed before the privatisation process can commence. Heineken spoke to our correspondent after the inauguration of the chairmen and members of the board of directors of River Basins in Abuja recently.

He said, “You can’t privatise without amending the law and I don’t think it is going to happen at this moment. So, I don’t think the Senate will accept the privatisation of the river basins now.”

The Federal Government had stated that there was imminent need for the privatisation of the RBDAs and their assets across the country in order to better achieve the objectives for which they were established,.

The Minister of Agriculture and Rural Development, Dr. Akinwunmi Adesina, was reported to have stated this while delivering the annual foundation day lecture of t,he Federal University of Technology Akure.

Adesina said since the 12 RBDAs across the country had failed to live up to their objectives under the government management, they should be handed over to the private sector to manage.

He said the RBDAs had performed poorly in the area of supporting agriculture through irrigation, as well as enhancing water supply and power generation.

Adesina was quoted as saying, “This is why we need to privatise the river basins to help ensure effective irrigation systems across the country.

“We launched for the first time ever dry season rice cultivation in 10 states of northern Nigeria, providing them with high quality seeds and fertiliser as well as irrigation systems and this is going to add an estimated 1.1 million metric tonnes of paddy rice, which is a third of what is needed to meet domestic self-sufficiency target by 2015.”

The RBDAs in Nigeria include Upper Benue Basin; the Lake Chad Basin; Benin-Owena Basin, Sokoto-Rima Basin, Sokoto; Hadejia-Jema’are Basin, Kano; Maiduguri; the Yola; the Lower Benue Basin, Makurdi and the Cross River Basin, Calabar.

Others are Osun-Ogun Basin, Abeokuta; Anambra-Imo Basin, Owerri; the Niger Basin, Ilorin; and the Niger Delta Basin, Port Harcourt.

Also commenting on the issue, the Chairman, House of Representatives Committee on Water Resources, Mr. Aliyu Ahman-Pategi, said privatising the river basins would not serve the interest of employees in the organisations.

He noted that members of the House of Representatives were not considering privatisation as an option to boost the performance of the basins.

Ahman-Pategi added that with the inauguration of chairmen and members of board of directors for the RBDAs, the operations of the basins would be enhanced.

He said, “The National Assembly is not in support of the privatisation of river basins in Nigeria. This is because one of the reasons for establishing river basins is to create jobs, but if they are privatised, the problem of unemployment may not be adequately addressed.”
The Punch

President Goodluck Ebele Jonathan has approved the implementation of recommendations of an investigative report on the upgrade of physical standards of all public universities owned by both the Federal and States government.

This was made known by Vice President Mohammed Namadi Sambo, during an official presentation of the 2012 Federal Ministry of Education Annual Report, which held yesterday at the National Universities Commission, Abuja.

The Vice President said the recommendations were reviewed earlier by the National Economic Council, adding that, “This is to ensure that our higher institutions of learning maintain the best of facilities and resources.  We must be in a position to produce graduates with the skills and competences to compete at the world stage.”

A statement by the Special Adviser to the Vice President on Media and Publicity, Alhaji Sani Umar said, while acknowledging the milestones achieved by the President Jonathan-led administration in enhancing qualitative education both at the basic and tertiary level, Sambo urged Nigerians to join hands with government to realise the noble objectives enshrined in the Transformation Agenda.
He said, “Our ability to meet our goals depends largely on patriotism to work together to build a better society for us and our children.  Education is one of those areas that are so crucial that our attention must continually focus on.  This is because it is an avenue that we can use to change a lot of things socially, politically and economically.  We must use the challenges of the past to provide solutions for the future.”

Vice President Sambo commended the Ministry of Education for being the first to submit its annual report as directed by the Presidency and also for diligently implementing its 4-Year Strategic Plan, aimed at transforming Nigeria’s population of about 170 million people to assets for national development.

“I do congratulate the Honourable Minister for not only producing this Annual Report but also for documenting other activities of the Ministry. These publications will definitely be of use to those who seek to find out more about the many activities going on in the sector and, if necessary, apply them to their own work.”

In her remark, the Minister of Education, Prof. Ruqayyatu Ahmed Rufai, highlighted the achievements of the ministry in 2012, saying the ministry was committed to transforming the Nigerian education sector. She stated that the ministry would continue to embrace modern technology to improve teaching and learning in all levels of education in the country as well as acknowledging the support of International Development Partners (IDPs) towards repositioning the sector.
Thisday

The Company plans to redeem and refinance its maturing obligations at the end of 2013 through 2014.
Finance analysts have commended the move by Nigeria’s Asset Management Company, AMCON, to redeem and refinance its maturing obligations at the end of the year, saying it would allay fears of inflation and financial instability.
Over the weekend, AMCON announced its intention through a circular of a comprehensive plan to redeem and refinance its maturing obligations at the end of 2013 through 2014. The aggregate amount of the debt instruments with a principal amount/face value of N5.7 trillion is to be affected. The principal amount issued as zero coupon bonds (where payment is retired in a final bullet payment) was N3.9 trillion, with three years tenure.
This indebtedness was incurred on behalf of the Central Bank of Nigeria, CBN, in its surgical intervention to stave off a looming systemic crisis in 2009. The bonds were issued in exchange of eligible bank assets (toxic) as well as recapitalization of the banks that failed to be acquired after the CBN intervention.
The banks that received these bonds either sold portions to CBN to raise funds to settle their interbank liabilities and/or kept them on their balance sheets as Held-to-Maturity (HTM) assets.
As of today, most of the N2trillion sits on banks’ balance sheets and the balance, N3.6trillion, sits with the Central Bank, according to Renaissance Capital, an investment bank.
The firm said AMCON will retire the N2trillion which is held by the banks this year and in 2014.
“The repayments will be done via cash and ‘liquidity status qualifying instruments’ that is, Treasury bills. Both AMCON and Central Bank have stressed that the “refinancing will be in a manner consistent with efficient macroeconomic stability, ensuring no monetary policy dislocation.”
“We take this to mean that the Central Bank will not allow cash to flood the market and threaten the naira and hence inflation. We believe banks are likely to receive Treasury bills in exchange for most of their AMCON bonds,” the firm said.
The redemption of bonds held by banks is expected to be complete by October 2014 at which point CBN will be sole creditor to AMCON, holding N3.6 trillion of bonds. These remaining bonds will be refinanced – the CBN governor, Lamido Sanusi, indicated yesterday at the MPC Q&A session that the new rate would be 6 per cent (currently up to 13 per cent).
Mr. Sanusi also said the AMCON levy, whereby all banks contribute to the AMCON sinking fund, is unlikely to be raised further from the current level of 0.5 per cent (of each bank’s previous year total assets). Last year it was lower at 0.3 per cent.
The Central Bank expects to recover its debt from AMCON via proceeds from the sinking fund and recoveries. To a large extent, this will become an internal affair between AMCON and CBN.
The firm said there are positive and negative sides to the development.
“Treasury bills are more liquid than the AMCON bonds – the secondary market in AMCON bonds never took off. Less liquid banks will be able to better manage their liquidity positions and hence we could see greater stability in the interbank rate – favours the Tier 2 and smaller banks,” the firm said.
RenCap however said as long as Mr. Sanusi is in office, he will ensure that there is no excess liquidity in the system.
“This means no likely reduction in the MPR or CRR in the short-term. The risk, in our view, is that the CRR could be raised further should there be a risk of excess liquidity,” it said.
Bismarck Rewane, Managing Director, Financial Derivative Company, a diversified financial institution said the rationale, justification or motivation of this move continues to be a subject of controversy and endless debate.
“The move by AMCON to redeem its obligations in an orderly manner, allows for a seamless systematic assimilation of a huge chunk of financial assets which had the potential of constipating the Nigerian financial system and undermining economic growth” he said.
“The leading question raised by most monetary economists is what will be the effect of this re-payment plan on monetary stability, especially the general price level in an inflation targeting monetary policy framework and environment. One has to bear in mind that the face value of the debt to be refinanced and redeemed is N5.7trillion which is 35% of Broad Money supply (M2). Conventional logic dictates that there is a positive correlation between money supply growth and the rate of inflation” he said.
Mr. Rewane said policy makers had been haunted in the last 48 months by the spectre of the transmission effect on the financial system and the supply-side shocks or its spill over impact of the redemption on other leading economic indicators.
“There is anxiety the consolidation of AMCON bonds into the national debt may push Nigeria into the club of countries with debt sustainability problems. Nigerian total debt service to GDP ratio is still at 0.5% which is well below the global average,” it said.
He said the Central Bank in anticipation of the possibility of money supply saturation resulting from the plan had mopped up more than an equivalent amount of liquidity from the system.
“This has created a money supply gap of N2.3trillion which will be filled by the monetization of the redeemed securities of N2trillion in 2013 and the refinancing of the N4trillion in 2014 by the CBN. The impact therefore, is neutral to the allocation of financial resources,” he said.
According to Mr. Rewane, the inflationary threats that typically accompany an explosion in money supply growth in a full employment economy will be relatively subdued in this case in Nigeria. He said there will be undercurrents of inflation that will bubble to the top, but this can be properly managed by a cocktail of measures within the ambit of the Central Bank.
The other elements of the orderly AMCON exit of the intervention process includes the sale of positions in asset held in equity, real estate and other markets. The holding of asset has two important systemic benefits. Firstly, is reducing the overhang in an equity market that was in a free fall. The fact that AMCON held off significant blocks of shares has allowed the equity market rally to enjoy relative sustainability. The other benefit is that the values of these assets in some cases have appreciated.
AMCON has announced a comprehensive plan to redeem and refinance N5.7trn of its bonds (37 per cent of Money Supply) in a bilateral agreement with the Central Bank. Analysts had expressed fears that the plan will have the unintended consequence of the transmission effect usually associated with high powered money. This includes runaway inflation and currency depreciation. The National Headline inflation rate is annually 9.1 per cent and the currency has been stable within a range for 3 years of N150 – N160.
“Analysis shows that these fears are mostly misplaced and grossly exaggerated. Whilst there is the orthodox correlation between money supply growth and inflation, the fact that a substantial portion of these bonds have already been monetised in repurchase agreements by some banks reduces the potency of this threat and any possible fallout” Mr. Rewane said.
Premiumtimes

The Asset Management Corporation of Nigeria (AMCON), which was recently talking to debt investors on a non-deal road show in London, as it looks to float debt to refinance a N5 trillion ($31bn) debt, said Monday it would retire N2 trillion worth of its N5.7 trillion of bonds this year and next from bad loan recoveries and refinance what’s left with the Central Bank of Nigeria (CBN).

This is seen as plus for the debt markets by analysts, leading to a rise in bond prices and consequent decline in yields as a substantial volume of domestic debt stock will have been removed via this initiative.

If this is achieved, it would mean AMCON has made great progress on recovering bad loans and that after the refinancing, the central bank will be the sole holder of its bonds.

The retiring of the N2 trillion worth of bonds will cut AMCON’s liabilities by 35 percent.

AMCON will also start divesting its shares in three lenders nationalised by the central bank in the next 30 days, starting with Enterprise Bank, it said in a statement.

“AMCON already indicated that the three nationalised lenders will be taken to market once they are stable and there are suitable buyers for them over a two to three-year period from the take-over date,” Abiodun Keripe, head of research at Investment One Financial Services Limited, said in an email response to questions. “If this is coming ahead of initial target, I think it is a plus.”

AMCON sold bonds to fund the purchase of bad debt and took over three of the rescued banks after regulators deemed them unlikely to meet a re-capitalisation deadline.

AMCON is a unique institution that combines the buying of bank non-performing loans (NPLs), with the restructuring or refinancing of performing loan and the re-capitalisation of troubled financial institutions.

It was set up in 2010 as a resolution mechanism for the Nigerian banking crises.

Data from AMCON show that it spent N5.6 trillion ($35.5bn) in 2011 to acquire NPLs, giving banks more capacity to lend to the private sector.

The intervention by AMCON has helped to reduce the banking industry NPL ratios to an industry average of about 5 percent in 2012, from over 30 percent in 2010.

Banks have also resumed lending with some like UBA planning to increase loans by as much as 40 percent this year to fund oil, power and manufacturing projects.

However, there has been some suggestion of the need to have a sunset clause for the ‘bad bank.’

The International Monetary Fund (IMF) in its latest report commended Nigeria’s success in stabilising its banking sector, but recommended AMCON wind down its operations to curb “moral hazard,” whereby a party is more willing to take a risk, knowing that the potential costs of taking such a risk will be borne by others.

Mustapha Chike-Obi, AMCON CEO, said last year that AMCON’s aim was to gradually reduce its operations and cut staff in the next five years, as a full banking recovery makes it no longer needed, saying “we are not buying any more non-performing loans.

“We have cleaned up the banking system, bad loans are under 5 percent and we want to make sure that everybody adheres to the prudential guidelines.”

AMCON, which reported a one off N2.37 trillion loss for the 2011 period at the end of last year, said “it intends to repay bondholders in December 2013 with cash and liquid instruments.”
Businessday

Minister of Aviation, Stella Oduah

The Federal Government on Wednesday approved the revised 2013 National Civil Aviation Policy despite serious objections by stakeholders in the sector.

The Minister of Information, Mr. Labaran Maku, disclosed the approval to journalists at the end of the Federal Executive Council meeting in Abuja.

He spoke alongside his counterparts in Aviation, Ms. Stella Oduah; Transport, Senator Idris Umar; and Minister of State for Federal Capital Territory, Mrs. Olajumoke Akinjide

Maku said aviation was a strategic industry and that there had been instances where certain players in the sector did not commit themselves to obeying the rules in the industry.

He said, “We debated extensively a new National Civil Aviation Policy presented to council by the Minister of Aviation. The policy covers the whole hub of the aviation sector, including a proposal to start a new national carrier driven especially by the private sector with government providing policy support.

“The policy also included the enforcement of rules in this sector. We are convinced that the policy has tackled virtually all the key issues that are crying for support and for additional action in the aviation sector. We, therefore, approved this new revised national policy on aviation and the minister, in the next couple of months, will implement the policy with all the key actors in the industry.”

Airline operators in the country had early this month expressed their grievances against the policy at an interactive meeting organised by the Ministry of Aviation for owners/operators of foreign and Nigerian registered aircraft in Abuja.

According to the operators, the new policy has a lot of contradictions that need to be addressed.

They wondered why the ministry would unveil such a policy without getting detailed inputs from informed stakeholders.

However, the Aviation minister maintained at the briefing that even though Nigeria had almost 100 private jets, there was no law guiding how they should operate.

According to her, private jet owners are not paying what they ought to pay to the government and that is part of what the new policy aims to address.

Oduah said, “The major highlights were in general aviation. When we talk about general aviation, we are talking about private jets. As of today, we have about 100 of them but we have no law, no policy and no regulation to make sure that they are operating the way they should operate within ICAO laws and our aviation policy.

“The question is not of taking advantage, it is a question of doing the right thing. Are they paying what they are supposed to pay? The response is no, they are not; but we want to make sure that they do pay what they are supposed to pay.

“These are part of what the policy is addressing. We want to make sure that private jets are private jets and commercial jets are commercial jets, and each will operate within the boxes they are meant to operate. So, we don’t want to overcharge anyone, we don’t want to undercharge, we want to do what is global standard.”
The Punch

The President, Dangote Group, Aliko Dangote, has diclosed that the sugar arm of his company will invest over $600 million in the production of sugarcane in Kebbi, Kwara and Sokoto states. Dangote made this known during a visit to the Governor of Kwara State, Dr Abdulfatah Ahmed, where he expressed satisfaction with the government’s effort at revolutionising agriculture in the state.

According to him, his company intends to replicate what it did in the cement industry by targeting about 65 million tonnes of sugar, which he said could produce about one million jobs for the people. Dangote emphasized that in the next five years; the company would produce and grow two million tonnes of sugar, as part of efforts to ensure that Nigeria is self-sufficient in consumables instead of depending on importation.

He said Nigeria was wasting quite a lot of money in the importation of about two million tons of sugar, adding that the company has identified Patigi local government area of the state for sugarcane plantation. Dangote further expressed hope that by cooperating with people and Kwara state government, the project would take-off before the end of the year.

Meanwhile, the Kwara State Governor, Abdulfatah Ahmed had pledged that his administration was committed to working with investors in bid to transform the economic lives of the people. Ahmed also gave the assurance that his administration would create enabling environment for would-be investors to operate coupled with adequate security for the growth of the economy. He noted that Nigeria would never get it wrong if it invests in agriculture as the northern part of the country was endowed with arable soil which could be utilized for agriculture as a foreign exchange earner for the nation.

It would be recalled that Dangote group recently announced plans to invest about $8 billion to build a 400,000 bpd capacity oil refinery in Nigeria by 2016, saying that sub-Saharan Africa need investments in this area. According to projection, if completed, this will double Nigeria’s current refining capacity. “This will really help not only Nigeria but sub-Saharan Africa.

There has not been a new refinery for a long time in sub-Saharan Africa.” The country currently has the capacity to produce some 445,000 barrels per day among four refineries, but they operate well below that owing to decades of mismanagement and corruption in Africa’s leading energy producer. Nigeria, the continent’s second-biggest economy, relies on subsidised imports for 80 per cent of its fuel needs.
The Sun

Finance Minister, Ngozi Okonjo-Iweala

The finance minister said the plan of Mr. Jonathan’s administration is to restore security and order.
Despite the threat of national insecurity, which has seen a state of emergency imposed in three states in the North Eastern part of Nigeria, the Finance Minister and Coordinating Minister for the Economy, Ngozi Okonjo-Iweala, on Monday said she is still confident the fundamentals of the economy remain strong.
The minister, who stated this during a conference call from her office with 112 analysts and global investment experts, identified several positive indices that gives her the confidence, namely economic growth at 6.5 per cent in the first three months of 2013; inflation down to single digit; fiscal deficit at only 1.8 per cent of gross domestic product, GDP, and foreign reserves at $48 billion.
With government promising to continue to work hard on many projects that would impact positively on the populace, Ms Okonjo-Iweala said the outlook of the economy remained very bright.
On the implications of the state of emergency declared last week by President Goodluck Jonathan in Yobe, Borno and Adamawa States on the nation’s economy, the minister said that the Federal Government is taking decisive actions to secure communities in the North Eastern part of the region affected by the activities of Boko Haram.
According to her, the intention of government with the action is to restore security and order to enable economic activities and normal life resume in the region, adding that the state of emergency was to give security agents the latitude to flush out insurgents from their bases.
On the strategies adopted by the government to ensure the success of the state of emergency in the affected states, Ms. Okonjo-Iweala said the presidency is adopting a multidimensional approach involving political dialogue, counter-terrorism tools and economic inclusion to solve the problem, adding that government’s expectation is the return of peace to ensure a strong foundation to spur economic growth, particularly through agriculture, the mainstay of the region.
While security forces continue to do their job, the presidential committee on amnesty is expected to also continue its work, the Minister said, adding that the President was particularly pained that the crisis had affected education.
The minister said it is unacceptable for children and teachers to be denied opportunity to go to school.
On efforts to diversify the economy, Ms. Okonjo-Iweala stated that the reform agenda was yielding fruits, with the agricultural sector being revolutionized to run on a profitable basis with access to fertilizer and improved seeds through more efficient, private sector methods.
She said that farmers were also being linked to markets to support them to achieve more productivity and better profit margins, saying farmers in the Northern part of the country were able to produce 1.3 metric tonnes of rice in the dry season this year.
To diversify the economic base, the Minister said there are plans for the development of the mining sector to translate to other minerals, such as coal, gold, and bitumen, adding that government was working hard at land titles, foreclosures, funding and other issues to fast-track the development of the housing sector.
On supplementary budget to tackle security challenges, the minister said that a Contingency Vote was already built into the 2013 budget to take care of emergencies such as security challenges and the flooding that affected many parts of the country last year.
To broaden the nation’s tax revenue generation capacity at the non-oil sector, the Minister said at the forum organized by Standard Chartered Bank that government would next month launch a new system which would ensure that though tax rate would remain, greater focus would be on corporate organizations that are currently not paying taxes.
Premium Times

The Nigerian National Petroleum Corporation (NNPC) is set to build the largest Africa’s gas city in Ogidigben, Delta State.
David Ige, the NNPC Group Executive Director, Gas and Power, made this known during the 4th International Conference and Exhibition on Free Trade Zone on Tuesday in Lagos.
The conference was organised by the Oil and Gas Free Zone Authority.
Mr. Ige, represented by Sam Ndukwe, the General Manager, Pipeline, said the aim of the project was to create the largest gas industrial park in Sub-Saharan Africa.
He said that steady progress had been made in delivering the critical pipelines infrastructure.
“This will address many of the gas deliverability challenges in the country,” Mr. Ige said.
Adamu Kontagora, Head, Marketing Department, Oil and Gas Free Trade Zone, Onne Port, said the investment had created over 30,000 direct or indirect jobs.
Mr. Kontagora said it had also created transfer of technology to Nigerians, through manpower training due to the specialised nature of its operations.
He said that the presence of the free zones had increased economic activities in the area, adding that Onne Port was the second highest port in Nigeria after Apapa.
Mr. Kontagora said there had also been an increase in the government revenue earning, particularly for customs, ports authority and Federal Inland Revenue Service as a result of free trade zones.
He said that the zones had placed Nigeria as a leading player in the oil and gas activities in the whole of sub-Saharan Africa.
Also, Odusola Stevenson, Chief Executive Officer, Century 21 System Communication, said the conference was to create a system and process to activate the knowledge networks among the zones.
The theme of the conference is tagged: “The Springboard to Sustainable Economic Transformation of Nigeria”
Premium Times

Paul Kagame

Economic growth and improved governance have changed the lives of citizens across the continent.
As the world economy continues to stagnate, a story of hope is unfolding on my continent. Nine out of 15 of the world’s fastest growing countries today are African. Over the past decade, the continent’s economies have grown at an average 5% per annum. Foreign direct investment, which stood at $9 billion at the turn of the millennium, last year exceeded $80 billion. Far from being a flash in the pan, this is the result of a sustained period of increasingly sophisticated economic management and stable politics.
This improvement in governance has changed the lives of citizens across the continent. In Rwanda alone, more than a million people have overcome poverty in the past six years. Ten years ago, Rwandan villagers would ask the government for food and basic necessities; today they demand better roads, improved electricity access and fast broadband. From Sierra Leone to Ethiopia to Malawi, the story is the same: an emerging middle class, growing in confidence and ambition, that seeks the same educational, economic and social opportunities that Americans and Singaporeans enjoy.
That’s not to say the picture in Africa is perfect. Far from it.
Poverty levels are still too high and energy production is too low. Infrastructure still needs more investment, and access to capital and savings remains problematic. But in our pursuit of development, Rwandans will not allow ourselves to stray from the path of fiscal prudence. Rather, we will continue to focus on building robust and reliable legal and regulatory frameworks.
When Rwanda issued its first international bond last month, we stood true to these values. The $400 million in 10-year bonds, sold at a yield of 6.875%, were a sign that Rwanda is now firmly on the path to economic maturity, having retreated from the edge of the abyss after the 1994 genocide. It also showed our intention: to build a modern economy, with a vibrant private sector that is connected to international markets. We want to be a nation less dependent on aid and fully engaged in a globalized economy.
That investors are pursuing high yields is perhaps one unintended consequence of the global financial crisis. But that should not diminish how encouraging it is that investors also embraced the chance to seek returns beyond the usual commodity-growth story. While Africa is a continent rich in resources, with 12% of the world’s oil reserves and 42% of its gold, we cannot follow too narrow a path to development.
Yes, we need to keep liberalizing our economies and pursuing greater global integration. But governance reforms and social development, propelled by economic growth that delivers tangible improvements in the lives of citizens, must also continue.
This has been our approach in Rwanda. We have decentralized the state, reformed our business sector and strengthened our institutions. But we have also invested in health care, agriculture and education. As a result, the World Bank this year ranked Rwanda as the eighth easiest place in the world to start a business. A recent index in Foreign Policy magazine named the country the fifth best investment destination world-wide.
There is a view that development is a marathon, not a sprint. We do not agree. Development is a marathon that must be run at a sprint. In our pursuit of progress, we have of course looked to East Asia’s so-called “tiger” economies for inspiration. But Africa’s experience is unique, and we must now define our own destiny.
So while being described as an “African tiger” is a welcome recognition of how far Rwanda has come, perhaps it isn’t quite right. After all, our continent has its own big cat. Step forward the new lions of Africa.

Mr. Kagame, president of the Republic of Rwanda, originally wrote this piece for the Wall Street Journal from where it was culled.

As part of proactive measures    aimed  at  tackling graduate unemployment across the country, the Ministry of Industry, Trade and Investment has inaugurated the University Entrepreneurship Development Programme to promote self-employment among the youth, right from institutions of higher learning.

The UNEDEP, which will be implemented by the Small and Medium Enterprises Development Agency in collaboration with the Federal Ministry of Education, is also aimed at enhancing and re-orientating the values of undergraduates; providing a mentoring platform for students; and reducing poverty and youth unemployment, among other objectives.

Speaking during the unveiling of the programme in Abuja on Tuesday, the Minister of Industry, Trade and Investment, Mr. Olusegun Aganga, said the programme would give students the opportunity for practical hands on experience to enable them to successfully manage their own businesses.

He said, “UNEDEP’s mission is to ‘catch them young’. The programme focuses on entrepreneurship development of undergraduates and aims to create future entrepreneurs; encourage self-employment; embed business ethics among the youth and consequently reduce the incidence of poverty.

“We will achieve this by using the existing Network for African Student Entrepreneurs club structure and deriving a standard schedule of activities for all members across all universities.

“Part of our strategy is to assess existing scalable student businesses to determine ways to enhance these, and then, creating a platform for student mentoring by successful entrepreneurs. Our goal is for students to receive the necessary capacity building as part of the activities of the entrepreneurship clubs.”
The Punch

Emerging Markets Telecommunications Services Limited, trading under the name of Etisalat Nigeria, has signed a $1.2bn medium-term syndicated loan facility agreement with Zenith Bank Plc, Guaranty Trust Bank Plc, First Bank of Nigeria Limited and 10 other banks.

The company plans to use the proceeds to refinance existing commercial medium-term debt of $650m and continue its network rollout across the country. It will also continue the release of innovative products and services to its over 15 million subscribers.

Other banks involved in the deal are United Bank of Africa Plc, Fidelity Bank Plc, Access Bank Plc, Ecobank Plc, Keystone Bank Limited, First City Monument Bank Plc, FSDH Merchant Bank, Mainstreet Bank Limited, Stanbic IBTC Bank Plc and Union Bank Plc.

The loan facility comes in both naira and United States dollar components.

Speaking on the transaction, the Chairman, EMTS, Mr. Hakeem Belo-Osagie, said the loan was yet another key step in the company’s development.

He said, “Etisalat Nigeria has grown from strength to strength, reaching 15 million subscribers earlier this year. This loan is a testament to the robust strategy of the company and the faith of the banking community.

“It will serve to further boost the company and the telecommunications sector. It is important to also note the enabling environment created by the federal and state governments of Nigeria as well as the Nigerian Communications Commission.”

Also speaking on the transaction, the Chief Executive Officer, Etisalat Nigeria, Mr. Steven Evans said, “We are delighted with the continued support and confidence shown by so many banking partners. They have shown great faith in the company since launch, and we view that as a sign of their endorsement of Etisalat Nigeria’s strategy and execution capabilities.

“We aim to continue to focus on our network expansion, our investment in 3G, as well as ensuring that we offer the uncompromising network quality and customer service our subscribers have come to expect from us.”

Zenith Bank, which is the lead arranger and major contributor to the facility, is to raise about N38.8bn in the tranche A, and another $30m for the tranche B.

The Divisional Head, Corporate and Commercial Banking, FCMB, Mr. Ola Olabinjo, said, “For us in FCMB, one of the cardinal concepts is to support any financing scheme that will impact positively on the economy and society.

“FCMB is aware that the Nigerian telecoms sector remains a key driver of the economy and Etisalat has shown growth potential within the period it has been in business in Nigeria.”

Etisalat Nigeria has benefited from the experience and support of its pioneer shareholders, Etisalat Group, Mubadala and Myacynth.
The Punch

   

Governor of the Central Bank of Nigeria, Sanusi Lamido Sanusi

The Governor of the Central Bank of Nigeria, Mr. Lamido Sanusi, has cautioned the Federal Government against excessive spending on military operations in three states in the North-East, Borno, Adamawa and Yobe, where a state of emergency was declared last week.

Sanusi, while addressing journalists shortly after the end of a two-day Monetary Policy Committee meeting held at the CBN headquarters in Abuja, argued that excessive spending on military operations posed a major risk to the inflation outlook.

Headline inflation increased from 8.6 per cent in March to 9.1 per cent in April, remaining within the target single digit range for the fourth consecutive month in 2013.

The figure, according to the central bank boss, reflects a combination of base effect and the success of tight monetary policy, which have led to a muted growth in the monetary aggregates and exchange rate stability.

He said while the principal risks to the inflation outlook remained fiscal spending and possible pressures on the exchange rate from any attrition to reserves caused by declining revenues as a result of output leakages, there was the need for prudence in monetary policy action.

Sanusi said, “The committee noted with caution the high Gross Domestic Product growth projection in view of the extant risk factors such as widespread insecurity, weak infrastructure and probable flooding from the projected heavy rains in some parts of the country.

“The state of emergency in the North-East and the accompanying military operations in that axis have the potential to adversely affect economic activities generally, including agricultural production and food prices as well as consumer demand.

“In addition, the recent military action in the North-East will result in additional spending. Although the government has announced that there will be no supplementary budget, the Coordinating Minister for the Economy and Minister of Finance has already announced that there will be a draw down on a contingency vote embedded in the 2013 budget to cover emergencies.

“Overall, the committee is of the view that government spending will constitute a major risk to the inflation and exchange rate outlook, thus advising prudence in monetary policy action at this time.”

The CBN governor also said the committee expressed concern over the low level of credit growth to the private sector and traced this to the crowding out effect of high growth in credit to the public sector.

He said, “The committee noted the N1.02tn increase in claims on the government and the N1.11tn drawdown on savings between January and April 2013, and particularly, the monetisation of $1bn in April 2013, being proceeds of the Excess Crude Account.

“The combined effect of new borrowings and reduced savings was an increase in net credit to the central government of over N2tn in the first four months of 2013. The evidence points to an increase in the rate of government expenditure in 2013 when compared with 2012.”

On the country’s external reserves, Sanusi expressed satisfaction with its significant increase to $49.13bn as of May 16, 2013.

This, he noted, represented an increase of $5.3bn or 12.1 per cent above the level of $43.83bn at the end of December 2012.

The reserves level, he added, could finance approximately 13 months of import.

On the Monetary Policy Rate, the governor said the committee left it unchanged at 12 per cent.

It also retained the Cash Reserve Requirement at 12 per cent and Liquidity Ratio at 30 per cent; with the Net Open Position at 1.0 per cent.
The Punch