Inside Business THE MAG AZINE OF THE CORPORATE WORLD DECEMBER 14, 2015
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SIR GEORGE ZANGIR President/CEO VALUE SEEDS LIMITED
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SIR GEORGE ZANGIR President, Value Seeds Limited
The Management and staff of
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INSIDE BUSINESS COMMENDATION AWARD (IBCA) - 2015 Your contributions towards the growth of Nigeria’s economy have earned you this great recognition and we are proud to associate with you.
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Congratulations!
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The Board and Management of
YOLAS CONSULTANTS Ltd. Engineers, Planners and Project Managers
Rejoices As Nigeria Celebrates 100 Years of Unity.
Pope Francis greeting Ugandans at Entebbe International Airport
The shrine commemorates 45 Christian martyrs burned alive in the 1880s on the orders of King Mwanga II of Buganda kingdom, who was alarmed about the growing influence of Christianity. According to historians, the men's fate was sealed by their rebuff to the king's sexual advances. The government had ordered extensive repairs and renovations to the shrine before the visit. Francis was accompanied to the mass by Museveni, who has been in power since 1986 and is currently campaigning for re-election in February. Referring to the martyrs, Francis urged people to become modern-day missionaries "to our families and friends certainly, but also to those whom we do not know, WEBSITE especially those who might be unfriendly, even hostile, to us". He also urged the church in Uganda to
"assist young couples to prepare for marriage, to encourage couples to live the marital bond in love and fidelity, and to assist parents in their duty as the first teachers of the faith for their children". Some in the crowd had slept at the site to ensure a place at the service, but most began arriving from 6am. At the pope's arrival, cheers, chanting and dancing erupted, with people shouting "Papa!" Ernst Baryevuga, among those lining the road to the shrine, said: "The pope's visit is what we needed at a time when people are being divided on political lines. His message will bind us in love." The mass was to mark the 50th anniversary of the canonisation by Pope Paul VI of the 22 Catholics among the martyrs. The shrine attracts thousands of pilgrims each year from Uganda and neighbouring countries. Later on Saturday, Francis addressed a youth rally in the city, telling the audience of 150,000 that there was "always a possibility of In opening the door and rising to the future". Around three-quarters of Uganda's population is below the age of 30, and there are high levels of unemployment and poverty. The pope heard testimony Pope Francis was welcomed by President of Uganda, Yoweri Museveni, from Winnie Nansumba, 24, 34
who was born with HIV and lost both her parents to Aids before she was seven, and Emmanuel Odokonyero, a former captive of Lord's Resistance Army rebels led by Joseph Kony that ravaged northern Uganda for more than 20 years. Since landing at Entebbe airport on Friday, the pope has praised Uganda for being open to refugees from countries beset by internal conflicts, such as South Sudan, DRC and Burundi. Uganda has been a key player in the politics in the region either as part of peacekeeping forces or as a peace negotiator. The pope held a private meeting with South Sudan's president, Salva Kiir, at Uganda's state house in Entebbe shortly after his arrival. Details of their discussion were not released, but it is believed the pontiff pushed for peace in the continent's youngest nation, where millions of people have been displaced and more than 10,000 killed. After leaving Kampala on Sunday, the pope is due to fly to Bangui, capital of the Central African Republic, for a 26-hour visit - the first by the pope to an active war zone. Vatican security officials were keeping the short trip under review and may yet make changes to his itinerary. Francis is due to visit a mosque in a volatile area of the city to appeal for reconciliation. The conflict in CAR is generally viewed as a struggle between minority Muslims and majority Christians. 3
In This Issue
I N S I D E B U S I N E S S A F R I CA
CONTENT
Inside Business THE MAG AZINE OF THE CORPORATE WORLD N500
DECEMBER 14, 2015
Inside Business THE MAG AZINE OF THE CORPORATE WORLD DECEMBER 14, 2015
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20 1 5
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24 Economy
5 Business Notes
Price of Friedliness
Gift from China
If you have an appetite for risk, investing in Nigeria gives you access to one of the final frontiers
China pledges $60 billion to Africa and the continents leaders are excited. What really is in this
SIR GEORGE ZANGIR President/CEO VALUE SEEDS LIMITED)
An Endorsement Uhuru backs China-Africa partnership
8 Cover Banking on Transformation
Issues in the News
December 14, 2015
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the day, he flew to Uganda. Credit L'Osservatore Romano Later on Friday, Francis flew to Uganda, where he will visit a shrine honoring some of the country's first Christians who were burned alive. So far on his African trip, he has called for more attention to be paid to the poor and for serious dialogue between different religions. His last stop, on Sunday, will be the Central African Republic, a country torn by a brutal civil war between Christians and Muslims. Many analysts say that the Central African Republic is one of the most dangerous places a modern pope will have ever visited. Morning rain gave way to a light lateafternoon breeze as Francis stepped off the plane in Uganda to ululating, hymns, a marching band, a 21-gun salute, dancers and a red carpet lined by clergy. After touching down, Francis spent roughly 20 minutes shaking hands alongside Uganda's president, Yoweri Museveni, before being whisked to the State House in a modest black hatchback for an official greeting. Uganda's highway all the way from the
Children in the Kangemi slum of Nairobi waited for Pope Francis to pass by on Friday. Credit Ben Curtis/Associated Press
airport into the capital Kampala was lined with children waving Ugandan and Vatican flags; traditional performers resplendent in white dress; palm trees adorned with ribbons; students sitting cross-legged by the roadside, from all faiths; even bright caricature paintings of Francis in front of a Ugandan flag - all to see who the main news pundits here call
Let there be peace
Sir George Zangir, President and Chief Executive of Value Seeds Limited believed the achievements and impacts they have made, apart from strong vision and commitment, would not have been rapid without coming in contact with the Alliance for a Green Revolution in Africa (AGRA)
Pope Francis uses mass in Uganda to preach reconciliation and peace
60 IBCA AWARDEES Provast Limited African Industries Group 1004 Estates Limited Dana Motors Limited Casbel Limited Premier Seeds Limited Oroki Herbal The 2°C limit on global warming
18 Oil and Gas Hurting the Economy
79 Issues in The News Pope Francis Came Calling Pope Francis, in Nairobi slum, discusses ‘New Form of Colonialism
Nigeria’s new change mantra reaching s part of Africa tour, pontiff urges Century 21 Systems Comm. Limited out to 'those who might be hostile' in conflict-ridden region excites french investors Pope Francis has preached a message of
Remove oil Sub-sidy now, World tells Buhari
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reconciliation on a visit to Uganda, calling on people to reach out to "those who might be unfriendly, even hostile, to us" within local communities and across the conflict33
"a different pope." "The Papa!" said Fazil Kabugo, a butcher in Kampala, readying to trek down to a Christian shrine at Munyonyo by Lake Victoria, where Francis was scheduled to visit Friday evening. "O.K., I'm a Muslim," he added, "but he's a very good man." Josh Kron contributed reporting from Kampala, Uganda. ridden region. On the fourth day of his Africa tour, the pontiff celebrated mass in front of 300,000 people at an open-air shrine to Christian martyrs in Namugongo, 10 miles from the capital, Kampala. LGBT activists will be deeply disappointed that Francis did not condemn homophobia, which is rife in Uganda. Many hoped he would at least urge greater tolerance after famously saying "Who am I to judge?" regarding homosexuality. A law signed last year by Uganda's president, Yoweri Museveni, compelled citizens to report suspected homosexual activity to the police, triggering increased levels of violence and discrimination against the gay community. The law was later annulled on a technicality but is expected to be reintroduced. The pope made no mention of the persecution of gay people in his homily at the shrine. However, his message that "as members of God's family, we are to assist one another, to protect one another" was seen by some as a coded appeal against discrimination.
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Pope Francis came calling Pope Francis, in Nairobi Slum, Denounces 'New Forms of Colonialism’
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he pope got a taste of Kenyan slum life recently.
He stepped out of his car on a muddy street and walked slowly past hundreds of poor children who live in shanties. He heard stories of gangs preying on women, of people dying from homemade alcohol and of sinister plots by businessmen to flood children out of their schools and steal land. When it came time to speak, Pope Francis delivered his sharpest remarks yet on his first trip to Africa. He lashed out against what he called "new forms of colonialism, which would make African countries parts of a machine, cogs on a gigantic wheel." Francis said that "countries are frequently pressured to adopt policies typical of the culture of waste, like those aimed at lowering the birthrate." He called the slums "wounds" inflicted by the elite. "How can I not denounce the injustices which you suffer?" he said. There are few places more apt for Francis, who has cast himself as a champion of the world's poor, to deliver such remarks. The slum he visited, Kangemi, on the outskirts of Kenya's capital, Nairobi, is a seemingly endless rusted-roof settlement where thousands of families cram into iron shacks with ripped mattresses on the floor and
cockroaches scuttling in the unlit corners. Many here survive on a few dollars a day. Pope Denounces Inequality in Kenya Speaking in Nairobi during his first visit to Africa, Pope Francis called for more equitable social integration and for helping the county's poor. Before he spoke, the pope watched a two-minute video that showed images of children wading waist-deep through rivers of garbage. Many of Nairobi's slums have no sewers, giving rise to what Kenyans call the "flying toilet," a practice of people relieving themselves in a plastic bag, closing it with a knot and then hurling it as far as possible. Francis did not share any new solutions to poverty, but he did say, "We need integrated cities which belong to everyone." And he singled out "faceless private developers" who try to steal children's
Pope attending to children
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playgrounds, a clear reference to an episode this year when the Kenyan police shot tear gas at children trying to protect a grassy field from being taken over by a cartel of mysterious real estate developers. Everywhere he has gone so far, Francis has been swallowed by enormous, ecstatic crowds. The Roman Catholic Church is growing rapidly in Africa, partly because of its role in delivering crucial services, such as good schools and hospitals, that many African governments fail to provide. For the past two days, Nairobi's streets have been jammed by people who have waited behind police barricades for hours for just a glimpse of the passing pope. On Thursday, 400,000 turned out for a rainsoaked Mass. After visiting the slum, Francis traveled to a stadium in Nairobi brimming with thousands of young people. As he pulled in, a deafening roar went up. People were dancing in the stands to choir music, wildly shaking yellow Vatican flags and cheering: "Papa Francis! Papa Francis!" The pope asked everyone to stand up and hold hands as a gesture against ethnic divisions, one of Kenya's most vexing problems. In 2007 and 2008, more than a thousand people were killed in ethnic clashes after a disputed election, and ethnic rivalries continue to be the axis that Kenya's dysfunctional politics revolve around. According to opinion polls, those divisions and corruption were among the topics Kenyans most wanted Francis to address. And before he left the stadium, the pope shared a few words on corruption, though he did not point any fingers. The subject has been a bit awkward for him because the corruption plaguing Kenya has been carried out, according to numerous allegations, by members of the same government that has placed the red carpet under his feet. "Corruption is something that eats inside, it's like sugar, it's sweet, we like it, it's easy," Francis said. "Please," he implored. "Don't develop that taste." Francis in Nairobi on Friday. Later in
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Gift from China... China pledges $60 billion to African development
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hinese and African leaders hail move as win-win cooperation and Robert Mugabe says Xi Jinping is "God-sent". Xi, at the Forum on China Africa Cooperation in South Africa, outlined 10 areas that will receive funding including infrastructure projects [Reuters] China's president has pledged $60bn to development in Africa, as part of what Chinese and African leaders called "winwin cooperation". President Xi Jinping made the announcement on Friday to rousing applause from an audience that included South Africa's President Jacob Zuma, Nigerian President Muhammadu Buhari, Kenyan President Uhuru Kenyatta and African Union Commission Chairwoman Nkosazana Dlamini-Zuma. Here is a man representing a country once called poor, a country which was never our coloniser. Zimbabwe's President Robert Mugabe Speaking at the Forum on China Africa Cooperation in South Africa, Xi outlined 10 areas that will receive funding including infrastructure projects, aid for d r o u g h t - s t r i cke n c o u n t r i e s a n d thousands of scholarships for African students. The Chinese government will also cancel outstanding debts for Africa's least developed countries in the form of
zero interest loans that mature at the end of 2015, he said. Xi also promised to provide assistance to help upgrade African healthcare facilities, train hundreds of journalists and provide satellite reception in 10,000 African villages. China has the world's largest foreign currency reserves at $3.51 trillion. State owned banks have often looked to
Kenya President, Uhuru Kenyata
An endoresement Uhuru backs China-Africa partnership to spur development
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enya President Uhuru Kenyatta during an interview by China Central Television on the sidelines of the Forum on ChinaAfrica Cooperation (Focac) conference 5
developing countries for investment opportunities. Xhanti Payi, a Johannesburg-based economist, told Al Jazeera that Africa needed $90bn a year to meet its infrastructure development needs. China's pledge "is not enough, but it's a good start", he said. According to economist Aubrey Hruby, the $60bn pledge is three times as much as the package promised at the last China Africa cooperation summit in 2012. 'God-sent' With China's recent economic woes, the Washington DC-based economist was expecting a more modest fund. Hruby added the package is likely to be distributed through numerous stateowned agencies and it will be difficult to track the funding's successes or failures. "There's not a lot of transparency in how it's broken down," she told the AP news agency. At Friday's summit, Zimbabwean President Robert Mugabe, hailed China's Xi, saying: "Here is a man representing a country once called poor, a country which was never our coloniser. He is doing to us what we expected those who colonised us yesterday to do. "We will say he is a God-sent person," he said.
in Johannesburg, South Africa. President Kenyatta observed that the Chinese leader's proposal to establish partnership with Africa based on mutual trust at the political front and a win-win cooperation at the economic front was a step in the right direction. President Uhuru Kenyatta has said that a partnership with China will help accelerate Africa's development and contribute to the cause of safeguarding world peace. He said the mutually beneficial and respectful ties between Africa and China resonated with the 10-point cooperation plan presented by President Xi Jinping at the opening of the summit of the Forum on ChinaAfrica Cooperation (Focac) in Johannesburg on recently.
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Chinese President Xi Jinping meets with Kenyan President Uhuru Kenyatta
The President observed that the Chinese leader's proposal to establish partnership with Africa based on mutual trust at the political front and a win-win cooperation at the economic front was a step in the right direction. "President Xi was not just all talk. He put $60 billion on the table to back his important statement," President Kenyatta said. He added: "China and Africa have the potential to achieve great things together. So let us do them." The Head of State spoke on Saturday during the Johannesburg China-Africa summit. President Kenyatta said the enhanced cooperation with China is also in line with the African Union's Agenda 2063, which seeks a peaceful, united and
prosperous Africa. "Focac is one of the strategic partnerships identified in Agenda 2063 as a key enabler to achieving the development goals of the African continent," said Mr Kenyatta. The President underscored the need to follow the fundamental principles of economy and build a market that is open and dynamic for the benefit of the people of Africa and China. "Traction for growth is always found in people. The diversity of people in any country must be harnessed to become an engine, and never a distraction, for powerful growth," President Kenyatta said. He lauded Focac, saying it provided Africa and China a structured channel for closer economic partnership.
Enriching the practice Experts seek facility maintenance law at IFMA awards
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015 Award Committee Chairman, Pastor Stephen Ola Jagun (left); immediate past president, Iyabo Aboaba; President, Mr Richard Okesola; and Public Relations Officer, Mr Segun Adebayo of International Facility Management Association (IFMA) Nigeria chapter during the Facility Management Award Dinner in Lagos, recentlyIFMA 6
members have been charged to fashion out a legislation to regulate the practice of facility management and ensure public and private institutions as well as individuals to embrace maintenance culture. FACILITY managers in Nigeria have been urged to canvass for a legislation that would compel public and private institutions as well as individuals to embrace maintenance culture. Experts made the call at the 2015 Facility Management Award Dinner organised in Lagos by the Nigerian chapter of the International Facility Management Association (IFMA) at the weekend. The Managing Partner SIAO Managing Consulting, Pastor Ituah Ighodalo, who was chairman said that Nigeria deser ved a well-maintained environment. Ighodalo, who is also the Pastor of Trinity House, Lagos, said the legislation would demand that qualified professionals would be tasked with the responsibilities of facility maintenance. He then urged IFMA Nigeria to ensure that the proposed law included provisions that would require “everybody that is involved in facility management to compulsory go through this association and qualify to be a facility manager so that it will save us from the trouble of all manner of people claiming to be facility managers.” The guest lecturer, and Managing Director, Alpha Mead Facilities Management, Mr Femi Akintunde, said that Nigeria would not be developed to the expected level if it continued to build structures without paying attention to maintenance. He said that maintenance culture must be promoted whether or not the country experienced economic boom. “We must give consideration to the life cycle of those facilities, otherwise the money we spend will not translate to real value,” he admonished.
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Oily food Fuel-price shocks have a big influence on the price of food
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HE prices of staple crops, like those of other commodities, are falling fast. In August they reached their lowest level for eight years, down by over 41% from their peak in 2011. That is not because people are eating less, or because farmers have become much more productive. Nor is it because of a slowdown in Chinese growth, in contrast to many other commodities. Whether going down or up, food prices are largely driven by other factors, among them oil prices and government policy. Oil first. Cheap fuel means cheaper food. Natural gas, whose price is tied to that of oil, is used for producing fertiliser; other hydrocarbons are used for machinery and transport. Roughly 20% of the cost of producing grain comes from oil, according to Kona Haque at ED&F Man, an agricultural-commodities merchant. Cheap oil also means less demand for biofuels, which in turn means cheaper food because of reduced appetite for grains used in biofuels, particularly maize (corn). Biofuel demand, once an insignificant feature of food markets, now has a sizeable impact: from 2000 to 2011, America went from using 6% of its corn crop (the world's biggest) to make ethanol, to 40%. Derek Headey and Shenggen Fan of the International Food Policy Research Institute, based in Washington, DC, estimate that the rising cost of oil
increased the price of American corn, wheat and soybeans by 30-40% between 2001 and 2007 simply by raising input costs. Adding in the impact of higher oil prices on the demand for biofuels, the effect on food prices was even greater, according to a paper by Sheng-Tung Chen, Hsiao-I Kuo and Chi-Chung Chen, three economists in Taiwan. Just as the price of food went up with that of oil, its current fall owes more to low oil prices than a self-correcting food market, says Josef Schmidhuber of the UN's Food and Ag riculture Organisation. In theory, when prices rise, producers should respond by expanding supply. But investment in agriculture did not increase in response to price increases. It dropped by 4.5% in real terms during a run-up in prices in 2008, and remained flat despite the price spike of 2011-12. In part, this is simply a matter of timing. Agricultural investment naturally lags price movements, since it takes time to bring more land under cultivation and grow a new crop. But even allowing for that, the rich world seemed blind to the price signals of 2008 and 2011, presumably because of the credit crunch and a lack of unused arable land. Britain's Overseas Development Institute found that only 23% of the post-2008 expansion in cereal supply came from rich-world commercial farms. Instead, production was ramped up in 31
developing countries, particularly in Asia and Africa. India accounted for 29% of the global increase in wheat production between 2005 and 2013. Taken together, China, India and Vietnam accounted for 61% of the global rise in rice production. However, it was not the market that induced this rise, but governments. Policymakers wanted to support domestic agriculture after seeing how the price spike could threaten their food security. India added to subsidies on fertilisers and power for farmers, as well as cancelling the debts of small farmers and offering them fresh credit. At the same time as dampening prices for consumers by releasing grain stocks, the government raised the "support" prices at which it buys up excess grain. All told, both China and India increased annual government spending on agriculture by 20-30% in 2008. For all the extra grain produced, government interference made the price increases worse in many respects. As the price of rice started to creep up in late 2007, China, India, Vietnam and many other producers began restricting rice exports. Such policies can help keep domestic prices down, but they worsen food shortages for everyone else. India's ban led to great hardship in neighbouring Bangladesh: as the share of Bangladesh's rice imports coming from India fell from 95% in 2007 to 3% in 2009, local rice prices almost doubled. Will Martin and Kym Anderson of the World Bank found that export bans explained 45% of the increase in international rice prices. Fear of shortages also led to stockpiling: the Philippines imported more rice in the first quarter of 2008 than it had for the whole of the previous year. Grain stocks were low in 2008, which left little cushion when prices began to surge. But even though stocks have since been rebuilt, they may not be of much use during the next price spike. Robert Subbaraman of Nomura, an investment bank, argues that stocks are concentrated in developing countries such as China and Thailand that could resort to export bans in times of high prices. Such a moment may not be far off: the incipient El Niño weather pattern normally provokes chaos in agricultural markets
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Continued from page 7
LR: Arc. Amb. Jery Ugokwe; Surv. Agbenla; Odusola-Stevenson; Engr. Otis Anyaeji; Engr. Ogunbayo; Tpl. Ajaji
problems confronting the country centers on discipline and corruption. He emphasized that Nigerians must imbibe discipline and cut down corruption. “It's important for professionals to emphasies the need to put square peg in square holes. We must be the change we want to see”, he stressed. Publisher of CED, Mr. Kenneth Odusola-Stevenson, noted that if technology and knowledge form the basis for meaningful economic development, given that globalization is radically accelerating the pace of change and raising the long-term stakes, it is clear that success in knowledgebased economies depends largely on the capabilities of people who are credential in meaningful and consistent ways.
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High on performance Construction Industry Hall of Fame: New professionals, firms inducted
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Engr. Otis Anyaeji with Engr. Ogunbayo and Engr. Umana
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Engr. Otis Anyaeji with Engr. Akindayomi and his Wife Engr. Otis Anyaeji with Advanced Concrete team
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ighteen distinguished professionals from the built environment sector including engineers, architects, sur veyors, builders and estate surveyors and valuers, were at the weekend inducted into the Nigeria's Construction Industry Hall of Fame at a well attended ceremony in Lagos. Besides, two corporate organizations including O.T. Otis Engineering Limited and Advanced Concrete Technologies Limited were also inducted at the 3rd edition of the Construction Industry Hall of Fame 2015 organised by Century 21 Systems Communication Limited, publisher of Construction and Engineering Digest (CED) Magazine. Among the individuals honoured were Engr. (Dr.) Joseph Folayan, Engr. Olumuyiwa Ajibola, Engr. Kashim Ali, Engr. Charles Akindayomi, Alabo Dagogo Fubara, Engr. Ayo Akideinde, Arc. Jerry Ugokwe, Engr. George Okoroma and Surv. Joseph Agbenla. Others are Surv. (Dr.) Bosun Ayinde, ENgr. John Okodi-Iyah, Engr. Anietie Umana, Builder Tunde Lasabi, ESV. Chudi Ubosi, Eng r. Nur udeen Rafindadi, ESV. Abdullahi Sani, Engr. Samson Ivovi and Surv. Okokon Essien. Listed in the corporate category
are O.T. Otis Engineering Limited and Advanced Concrete Technologies Limited. In his welcome address at the ceremony, Publisher of CED magazine, Mr. Kenneth OdusolaStevenson, noted that many professionals in the built environment including the inductees have, in no small measures, pulled together resources, their intellectual and professional capabilities to build infrastructure across the country from road, housing, oil and gas, aviation and maritime to space technology among others. “Above all, they have all made remarkable contribution to nation building by developing and building enterprises that are given opportunities and space to young professionals to engage their talent”, he said.
Engr. Anyaeji with Engr. Okoroma and his wife
In a discussion on the theme “Engineering and Economic Prosperity of Nations”, guest speaker and Chairman, O.T. Otis Engineering Limited, Otis Anyaeji, an engineer, emphasized that economic development of any nation is based on industrialization. He said for the country to industrialise, it has to start from machine tools production and move to agricultural tools such as tractors, trailers to jumpstart the economy. Anyaeji explained that there are a lot of resources in the country that needs to be harness rather than depending on importation of goods that will lead to economic prosperity of the nation and create jobs for the teeming youth that are faced with unemployment challenge. “If Nigeria harnesses what it has in the agricultural sector through engineering, it will yield more income than oil”, he stressed. The O.T. Otis Engineering boss added that for engineering and other p ro f es s i o n a l s to d evel o p, th e government has to be involved, “we need to try and get the government to be interested in the innovation process” he added. He disclosed that the Nigeria infrastructure master plan stipulated that about N2.9 trillion will be needed to provide and meet the infrastructural need. Chairman of the occasion, Mr. Ibikunle Ogunbayo, an engineer, said without viable construction industry, the economy of any nation is not going to develop. He added infrastructural provision is very important to the development of the country. “We are here to open a window to those who are not yet a member of the Construction Industry Hall of Fame. We are here to celebrate those members of the construction industry whose despite all odds, still perform excellently well”, he added. A discussant and one of the inductee, Ambassador (Arc.) Jerry Ugokwe, noted that one of the major Continued on page 30
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Cover Feature
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it difficult to sell their goods as most of the finished goods end up as items of inventory in the warehouses. Noting that e-commerce had gained recognition in both national and global trade, Oguntayo said the bank planned to facilitate the participation of Nigerian SME operators in the global ecommerce sales, which is currently estimated at $1.5 trillion.
DRIVEN TO SUCCEED Leading from the front, Sir George Zangir souped up the Value Seeds Limited and put it on the growth path
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Changing equation Buhari plan economic diversification in 2016
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resident Muhammadu Buhari has said his administration would enact new policies to diversify Nigeria's economy from oil to other sectors such as agriculture, mining and manufacturing. The diversification, according to the President, will be captured in the 2016 national budget. President Buhari gave the hints at a meeting with a delegation of French investors under the aegis of Movement of the Enterprises of France, MEDEF, led by its President, Mr. Pierre Gattaz, in Abuja, yesterday. It will be recalled that President Buhari had, during his visit to Paris three weeks ago, met with the investors who assured him of a visit to Nigeria on investment survey. President Buhari said the policies
In addition, he explained that the potential worth of e-commerce in Nigeria put at an estimated $10 billion per annum, offers a huge opportunity for discerning businesses to explore and tap into to grow their market share. "Available statistics show that the ecommerce sector in Nigeria currently boasts of about 300, 000 online orders daily. Our desire at Skye Bank is to cur rently being evolved by his administration would boost domestic manufacturing and attract greater investment to Nigeria's agricultural and mining sectors. He urged Mr. Gattaz and the French trade mission, which houses over 50 companies with interest in manufacturing, agriculture, infrastructure development and other areas, to return to Nigeria next year and take full advantage of the new policies. Raising hope of stamping out insecurity which provokes fear in foreign investors, President Buhari also assured the French investors that under his leadership, Nigeria would not fall short of international standards in the protection of foreign investments and the repatriation of returns on such investments. He said: "We are doing our utmost best to encourage diversification into non-oil sectors, which can employ a lot of people and we will welcome your support
substantially grow these figures and make e-commerce the new trade highway in Nigeria", he said. The Skye Bank boss described the YesMall as an e-commerce platform, which offers Nigerians cost-effective opportunities to buy and sell online from the comfort of their homes. The Mall will also provide opportunities for many Indigenous Entrepreneurs to showcase their products to a borderless market "The introduction of YesMall is therefore a deliberate strategy to live the spirit of our mission statement which is using technology to drive innovation and enable consumer lifestyle", he said. Executive Director, Technology and Service Delivery Channels, Mrs. Markie Idowu, described the Yesmall as an electronic market for showcasing locally made products and services of Nigerian small and medium scale enterprises. She maintained that Skye Bank has in the last one year provided free capacity building support to over 2500 entrepreneurs across the country that are also customers of the bank. Culled from the Guardian
in this regard." "Ultimately, reducing unemployment will also help to improve security because unemployment and insecurity are inseparable," President Buhari told the French investors." A statement by the Special Assistant to the president on Media and Publicity, Mallam Garba Shehu further quoted the President as saying "that Nigeria will also welcome more French investments in its power sector", stressing that "availability of steady power supply will lead to the reopening of closed factories and the creation of more jobs." The statement also assured the delegation that the present administration was tackling corruption with vigour to ensure greater probity in the management of national resources. The MEDEF President, who spoke on behalf of the French investors, had earlier raised concerns on the safety of their planned investments in Nigeria and the easing of bureaucratic bottlenecks.
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e-Commerce net widens in Nigeria ICT has made doing business very easy worldwide. The historical, "linear" business model has been altered.
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S the world economy becomes m o r e a n d m o r e interdependent and interconnected, e-commerce has taken the front burner as the main vehicle of international trade. In this new age of knowledge and digital economy, and the application of Information and Communication Technology (ICT) to boost trade among nations, the Internet has become the gateway to the global ecommerce world of convenience, comfort, security and speed. ICT has made doing business very easy worldwide. The historical, "linear" business model, in which consumers shopped only in stores they could walk or drive to, in which manufacturers conducted business only via retailers, has been altered. The worldwide spread of Internet accessibility via smartphones is driving
the expansion of e-commerce that is changing the retailing landscape forever. Without any shred of doubt, ecommerce is already big business, and research shows it is shifting into a yet higher gear. Growth estimates suggest business-to-consumer (B2C) ecommerce sales worldwide will reach $1.5 trillion this year, a 20 per cent increase over last year. In Nigeria, with the aid of the Internet, the potential worth of ecommerce is estimated at over $10 billion. This is a huge opportunity for discerning corporate organisations to explore and tap for growth. Available statistics show that the ecommerce sector in Nigeria currently boasts of about 300, 000 online orders daily. Internet enhances competition and also stimulates trade. The rise and 28
subsequent growth of online shops in Nigeria can be attributed to the ease, convenience and the security associated with e-commerce. For instance, online shopping platforms like Jumia, Konga, Yudala, Dealdey, among others have become alternative market to a teeming online shoppers who buy and pay for goods online without stepping out of their homes. However, many small and medium scale enterprises (SMEs) in Nigeria do not have the wherewithal or the expertise to run an online shop thereby making it difficult for them to sell their goods. The desire to help SME operators find market for their goods is the main reason behind Skye Bank Plc's recently unveiled an online shop, YesMall, to help SME operators find buyers and earn income. Group Managing Director/Chief Executive Officer of Skye Bank Plc, Timothy Oguntayo, at the unveiling of YesMall in Lagos, described the online store as a unique bundle, which offers the benefits of a product on the one hand and the opportunities of an online mall where our current and prospective SME and retail customers can buy and sell their products and services. As the name sounds, the Skye YesMall is an e-commerce platform which offers three primary and distinctive benefits, namely provision of convenience for our customers who seek cost-effective opportunities to make purchases online from the comfort of their homes, and offering a unique opportunity for our SME customers to cross-sell The new online store, called YesMall, offers a unique experience for the bank's current and prospective SME and retail customers who can now buy and sell their products and services from the comfort of their homes by using electronic devices such as: phones, tablet, laptop, or desktop. They can also do their transactions by using the ATM machines nearest to them According to Oguntayo, the bank came up with the platform after noticing that some SME operators find
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Banking of transformation Sir George Zangir, President and Chief Executive of Value Seeds Limited believed the achievements and impacts they have made, apart from strong vision and commitment, would not have been rapid without coming in contact with the Alliance for a Green Revolution in Africa (AGRA)
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ETTING quality seeds across to the smallholder farmers was the major problem that Sir. George Zangir and his team in Value seeds, Nigeria, faced at the inception of the company in 2009 as they lacked the funds to create the necessary awareness among the farmers on the need to use improved seeds. All this changed in 2011 when the government of Nigeria came up with Agriculture Transformation Agenda (ATA) and chance meeting with the Alliance for a Green Revolution in Africa (AGRA). The company's President, Sir. George Zangir, in this chat with Inside Business Africa disclosed what the chance meeting with AGRA has done to the company in terms of capacity building and scaling up. Capacity building "I don't have agric background. When I started working for UAC back in 2003, I was in administration and at a point the Managing Director felt I should be converted to marketing and since then I have worked in the marketing units of either seed c o m p a n i e s o r A g r o ch e m i c a l companies. "So in the agric sector I have always been a marketing person and I have always worked for companies that valued training. I was very fortunate to be so trained and well trained as well. "I have experience cutting across technical aspects of seed production and of course marketing aspects of it. I have been t o Lagos Business School and Harvard Business School too. " Having worked with UAC where he discovered that the major challenge of the smallholder farmers was the availability and access to top quality seeds, he decided to go into seed business with the establishment of Value Seed Company in 2009.
"When we started in 2009 we could barely sell 100metric tonnes of seeds. The challenge had always been that of distributions, we did not have money to create good awareness for seeds of improved varieties. "Farmers did not know about the existence of quality seeds, you needed to do demonstrations, you needed to do a lot of activities that will create awareness, but we were handicapped by dearth of funds and in time we decided to go small and increase gradually." The solution to funding came in 2011 when the Nigerian Government decided it was time to pay more attention to agriculture with the introduction of the Agriculture Transformation agenda. "The ATA prog ram which gave the seed companies access to affordable financing with sovereign guarantee to a number of banks and today a lot of Nigerian seed companies have been empowered and it can only get better." He added "We were fortunate to be among the seed companies picked, though we had always had our plans to transform the sector but for lack of funds. So with access to funding we decided to implement and since then we have done a lot in developing farmers' Since 2009, Zangir sees their assistance to almost 10,000 farmers in the area of extension services as a major achievement, "We have also introduced improved varieties and like I told you in my introduction that our key focus is bridging the gap between top quality materials, which are results of good research, and commercializing the research work. 9
awareness to improve seeds of good varieties. Since 2009, Zangir sees their assistance to almost 10,000 farmers in the area of extension services as a major achievement, "We have also introduced improved varieties and like I told you in my introduction that our key focus is bridging the gap between top quality materials, which are results of good research, and commercializing the research work. "So what we have done is also take this to the farmers by creating very good distribution channels over the years. We have done a number of works in lots of states in Nigeria cutting across the northern states, the middle belt and we looking of moving into the South West." He added "Until we came on board the packaging in the seed sector was something that needed a lot of improvement. Lots of seeds companies were using the polythene; we came and started using the poly woven sacks. "We introduced affordable packages like 2kg, 1kg which were not in existence and this provided affordable seeds to farmers. "We have also gone ahead in the area of seed dressing as most often farmers are short changed by being given seeds with only colorant instead of seed dressing. We have partner with some agro chemical companies in making available to farmers seeds that are dressed with top quality dressing materials. "This has helped in improving the yields of farmers and I tell you they calling to commend what we are doing .Most of the farmers that have been using our seeds have been able to turn around their fortunes." Green revolution Zangir believed the achievements and impacts they have made would not have been rapid without coming in contact with the Alliance for a Green Revolution in Africa (AGRA) as they are one of the latest guarantees of AGRA having accessed their grants to boost their activities in seeds
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distributions and awareness creation in Nigeria. "AGRA is good news to Africa; AGRA is good news to Nigeria. AGRA is good news to farmers and extremely good news to Value seeds. "In 2011, AGRA officials were in Nigeria going round to look at what their guarantees have done and then they were going to hold meetings of guarantees in Kano. I think as they were going they got to a Sir George Zangir village at Kura and were meeting with Agro dealers. "In one of the agro dealers' shops, I think they spotted our seeds, we were completely not known by AGRA at that time, but when they saw the seed they insisted that this seed company should be among those to participate in their meeting in Kano. "So we were invited and for the first time participated in AGRA activities and since then it has been one added value addition activity to the other. "We have benefited from AGRA in the area of training; technical capacity development; in the area of marketing; in area of distribution channels and development. The result of AGRA in the life of the company is giving them hope of scale up their seed production to 10,000 metric tonnes soon as they are already producing above 5,000mt.
Before this time, he worked for UAC Seeds Division, a Division of UAC of Nigeria PLC, between 1993 and 2000, where he rose to the position of Regional Sales Controller. He left The Candel Company Limited in January, 2012 to concentrate in coordinating the activities of Value Seeds Limited, a company he founded in 2009. A graduate of Administration, Sir Zangir has attended a number of local and international courses in marketing, l e a d e r s h i p, d i s t r i b u t i o n a n d negotiation. He has attended Executive Program on Decision Making at Harvard Business School. He is an alumnus of Lagos Business
SIR GEORGE ZANGIR Sir George Zangir worked for The Candel Company Ltd from 2004 to 2012 and rose to the position of Regional Manager, heading at different times the Company's operations in the North and Middle Belt Regions of Nigeria. Previously, he worked for Jubaili Agrotec as Head, Sales Department between 2003 and 2004. 10
School, University of Stellenbosch Business School, Cape Town and Antai Business School, Shanghai. He was part of a select multinational group that participated in International Training and Study Tour on Designing and Implementing Agric Inputs Marketing Strategies in Developed and Developing Countries in United States of America between July and August, 2012. This training exposed him to agricultural best practices in developed countries and gave him the privilege to travel to Alabama, Kentucky, Indiana, Missouri, Illinois and Washington D.C. to study Precision Agriculture. A Roman Catholic Knight of the Ancient and Noble Order of Saint John International. He is the Worthy President of St Louis Commandery 691, Kano. Sir Zangir is married to Lady Cassandra George and they are blessed with children. With tenacity, commitment and clear vision to remain on top of his game, Sir George Zangir has been confirmed as Inside Business Africa Businessman of the Year 2015
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spreads for emerging market sovereign bonds in general have declined since peaking in April, as the last chart shows. In addition, although inflation is falling pretty much everywhere else, it is rising in sub-Saharan Africa and is expected to hit 7 per cent this year and 7.25 per cent in 2015, pressuring more countries to raise interest rates, potentially sapping growth still further. John Ashbourne, African economist at Capital Economics, forecasts even weaker sub-Saharan growth of 3 per cent this year, a figure that would be "unprecedented in the period of the whole Africa rising narrative". Furthermore, he argues that with Africa experiencing rapid population growth, the problem is even worse than it might at first appear, with countries such as Nigeria likely to experience negligible growth in GDP per capita this year. "It will be more or less stagnation. Three per cent growth in Africa is a much worse outcome than it would be elsewhere in the world," he says. Like the IMF, Mr Ashbourne does believe Africa's GDP growth will tick up in 2016, as some of the factors that have depressed growth in Nigeria, South Africa and Angola fade. Nevertheless, he believes the current slowdown should be food for thought for adherents of the Africa rising concept, which, he says, has been "overplayed". "It's certainly true that growth has picked up a lot from where it was in the 1980s and 1990s. Things were very grim then, income per person was falling. "But people misunderstood [the concept]. It was always going to be a very difficult and lengthy process," says Mr Ashbourne, who is critical of the "irrational optimism" that led some to believe per capita growth could continue almost indefinitely at 5 per cent a year, meaning Africa would resemble Denmark by the 2060s. "It doesn't work like that. Over the long term these are economies that will look more like Cambodia or Central America. They are not going to skip a level and suddenly become Malaysia," he says. "The gap is not much smaller than it was 30 years ago. I don't think we will see this rapidly shrinking in the way we have seen in Asian countries.
Grounding opportunities South Africa’s Zuma sacks finance minister
President Jacob Zuma
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outh African President Jacob Zuma on Wednesday dumped finance minister Nhlanhla Nene, seen as a stumbling block to some of his pet projects, as the country faces growing economic turmoil. The local currency, the rand, fell sharply to 15.24 to the dollar shortly after the announcement, extending a series of losses this year. “I have decided to remove Mr Nhlanhla Nene as Minister of Finance, ahead of his deployment to another strategic position,” Zuma said in a statement, without specifying what that position would be. “Mr Nene has done well since his appointment as Minister of Finance during a difficult economic climate,” Zuma said, without providing the reason for sacking him. Zuma said he would appoint r uling ANC parliamentar y backbencher David Van Rooyen as the new finance minister. Van Rooyen was described by newspaper Business Day as “a malleable member of parliament’s finance committee”. Nene’s departure had been predicted earlier
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Wednesday by Business Day, which pointed out that the Treasury under Nene had “dragged its feet” in providing funds for a massive nuclear power deal which critics say could bankrupt the country. Nene had also clashed recently with Zuma acolyte Dudu Myeni, the board chairman of the ailing national airline South African Airways, which relies on government bailouts to keep flying. Zuma said Nene’s new post “will be announced in due course”.
The announcement of the change at the top of the finance ministry comes as ratings agencies rank government debt barely above junk status, with unemployment at more than 25 percent and South Africa narrowly escaping recession with 0.7 percent growth in the third quarter.
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Slowdown calls 'Africa rising' narrative into question Per capita growth nears stagnation as structural gains peter out
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conomic growth in sub-Saharan Africa will slow to its weakest pace since 1999 this year, and only inch up modestly next year, the International Monetary Fund said recently. The forecast is just the latest piece of analysis to implicitly call into question the "Africa rising" narrative that improved governance means the continent is almost predestined to enjoy a long period of mid-to-high single-digit economic growth, rising incomes and an emerging middle class. It follows the release of the 2015 Ibrahim Index of African Governance, which found that standards of governance have declined since 2008, suggesting the progress made earlier this
century was largely driven by windfall gains from high commodity prices rather than structural improvements. The IMF forecasts that economic growth across sub-Saharan Africa will slow from 5 per cent to just 3.75 per cent this year well below its October 2014 projection of 5.75 per cent - before picking up slightly to 4.25 per cent in 2016. Moreover, the weak growth cannot all be laid at the door of the slump in global oil prices. While gross domestic product growth in oil-exporting nations is forecast to come in at 3.6 per cent this year, before edging up to 4.2 per cent in 2016, the IMF forecasts the continent's "middle-income" countries will register growth of just 2.6 per cent this year and 2.9 per cent in 2016, as the first chart shows. 26
These middle-income countries are being dragged down by South Africa, which is expected to record growth of just 1.4 per cent this year thanks to a combination of power cuts, job cuts in the steel and, potentially, mining sectors, and tighter monetary and fiscal policy. However, the IMF has also cut its forecasts for other large middle-income countries such as Ghana and Zambia, as the second chart shows. In Ghana, its says growth has been held back by fiscal retrenchment, high inflation, falling electricity supplies and a disappointing cocoa harvest. Activity in Zambia is being sapped by depressed copper prices, high interest rates and "severe" electricity shortages. However, several low-income countries and "fragile" states, such as Ethiopia, the Democratic Republic of Congo, Ivory Coast, Tanzania and Rwanda, are expected to deliver the strong growth of 6 per cent to 8 per cent forecast a year ago, albeit from low bases. Here, growth is being supported by infrastructure investment and "solid" private consumption. More broadly, the IMF paints a grim picture. It argues that "savings have been modest during the recent period of rapid growth", leaving countries "limited room" to counter the drag on activity or smooth the adjustment to the economic shocks. External and fiscal positions are "significantly weaker" than in 2008, particularly for oil exporters and frontier markets, it says. Fiscal balances are weaker than in 2008 in 34 of the 45 countries in the region, "despite robust growth in the last few years". External balances are also weaker in 21 countries, with those such as Ethiopia, Ghana, Kenya, Senegal, South Africa and Senegal facing gross external financing needs in excess of 10 per cent of GDP, says the IMF, adding that "it might at best become increasingly difficult and expensive to cover these needs, and at worst, impossible to do so, forcing an abrupt adjustment". These funding concerns are undoubtedly feeding into the slumping price of sub-Saharan frontier bonds, the yields of which have jumped to 650 basis points above US Treasuries, even though
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Doing the right thing Provast Limited ia the foremost-integrated facility management company in Nigeria
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stablished in 1997, Provast Limited has become one of the foremost integrated facility management companies in Nigeria, building on its establishing principles of delivering sustainable, efficient and fully integrated facilities management services to its clients. With a vision of becoming the industry benchmark in the provision of long term and innovative facilities management solutions which preserve the quality of assets, enhance return on investment and add value to our clients' operations. Provast Limited has acquired rich client portfolio of both residential and commercial facilities and is committed to ensuring each client is satisfied by their efficiency and effectiveness. Provast has over the years maintained its commitment to preventive facility management. Focusing on developing strategies that have become their trademark modus-operandi on every project. This established principle, the creation of Planned Preventative Maintenance (PPM) programmes in collaboration with their clients that
reduce downtime and extend the lifecycle of physical assets. Led by an impressive team of professionals, Provast boasts a high skill competency level of all employees, leading them to have an established pride in their capabilities a factor which has encouraged them to take on new projects with enthusiasm and professionalism. Provast Nigeria in order to optimize its commitment to any project, offers tailored services to its clients, matching the client's needs with tailor made solutions. The competitive nature of the company puts it as one of the trailblazing A Technologically adept and value adding company, Provast prides itself on employing up to date technology in order to remain a pioneer in the sector constantly evolving work processes in order to continuously provide optimum services to their clients and pride themselves in their ability to form unique partnerships with their clients. 11
companies in the facility management enterprise, forerunning innovations in the sector A Technologically adept and value adding company, Provast prides itself on employing up to date technology in order to remain a pioneer in the sector constantly evolving work processes in order to continuously provide optimum services to their clients and pride themselves in their ability to form unique partnerships with their clients. They believe the basis for this partnership is their commitment to delivering promises. Through this, there is an establishment of a basis for trust, confidence and in return Provast offers transparency providing clients with the lowest long term costs at the best service levels by improving productivity, efficiency and service quality. A value added support system for client management is also integrated to their services and there is always a provision of flexible and cost effective work or living environments for their clients' clients while also eliminating the costs associated with ineffective work processes. It is for their commitment to efficiency, value addition and customer satisfaction, we congratulate you.
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Opening the industrial space Led by Raj Gupta and Alok Gupta, African Industries (AIG) is the foremost producers of steel in Nigeria thereby opening up the industrial base of the country
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s economic development takes off in Nigeria, the consumption of steel is rising in the country. In order to reduce the dependence of the country on imports, African Industries Group, the foremost steel producers in Nigeria has strenghtened its operations therought strategic and major investment in technology and expansion of its production lines. The high request for steel products reflects the positive economic development said Raj Gupta Nigeria , chairman of African Foundries Limited a member of African Industries Group. According the Gupta this is a good time to invest in new production capacity since the economic growth of Nigeria is estimated to increase by about in seven percent 2016 and the country been the largest economy in Africa, will keep growing strong.
Raj Gupta Nigeria built few years ago a steel mill in the Ogijo, Ogun State, close to Ikorodu, Lagos State, the commercial center of the country. The investment at the time was valued at USD 123 million an was completed in three phases. In the first trimester of 2011, the company completed the building of the foundry where raw iron is smelted. By the end of that year, the power plant and rolling mill that were the two other phases of the project were completed. The main objective of the mill is to produce hardened steel support bars of 8 to 32 millimeters. This mill produces 225,000 tons per year. Led by Raj Gupta and Alok Gupta, African Industries (AIG), started manufacturing steel in Nigeria in the year 2002, now they have steel plants both in Lagos and Abuja that produces steel
from recycling scrap in induction furnaces. With headquarter outside Lagos and operations in West Africa, Middle East, Asia and Europe over the years. AIG have expanded its steel manufacturing capacity with new plants starting to produce billets, they have also broadened their interest to include power and sea transport businesses and today they have reached a steel production capacity of 735,000 MYPA. AIG currently have 8 manufacturing facilities in Nigeria - all green field products constructed in the last decade. AIG's goal is to continuously expand its manufacturing activities through backward integration and play a pivotal role in the development of Nigeria. The group strives to create a sustainable and diverse business, through fresh foreign i nve s t m e n t , i t s e n t r e p r e n e u r i a l leadership, constant pursuit of excellence, high level of integrity, multicultural workforce and strong corporate leadership. The group is strongly positioned to utilize Nigeria's resources for Nigerian growth, also invested up to half a billion dollars in Nigeria in the last decade with resource availability, the group is poised to double the investment in 5 years by the manufacturing, lead recovery, electric arc furnace, steel fabrication and iron ore beneficiation. AIG generates direct employment for about 5,000 Nigerians and indirectly creates jobs for at least another 10,000. It also has offices in UAE, Ghana, Romania, China and India. As one of the largest industrial group in West Africa, AIG remains a power house in the construction industry and a major contributor to the Nigeria economy. Salute!
malls is increasing. The amount of shopping malls in Nigeria is on the low side, if you compare it with the amount of people living here and the future potential. Because the middle class in Nigeria has more money to spend, modern retail development is on the rise here. The new generation also tends to be more 'westernised' which makes this kind of real estate more popular. Profits from investing in Nigeria real estate To get an insight in Nig erian real estate market's performance of the coming years, it's interesting to take a look at research done by Agusto & Co, a provider of industry research focused on Nigeria. This research has led to a report with predictions. Agusto & Co predicts a 10% growth in the commercial property and residential market throughout 2015. The residential and commercial markets have not shown any signs of decline. The fastest growth has been happening in terms of population, economy, urbanization, and consumer's disposable income. Another interesting result from this report is that Lagos makes up for 40% of the entire Nigerian market. For a country that's bigger in size than France, this shows very clearly what the impact of Lagos is on the rest of the country. Difficulties entering Nigeria's real estate market Although there are not many rules against foreigners owning property in Nigeria, there are some things that could make it difficult. First of all, it's expensive to register property in Nigeria. Construction costs can also be higher than in western
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countries. Nigerian building companies are just not up to the level of those in well developed countries, so it will be more costly if you want your real estate properly constructed. Interest rates on mortgage loans are very high in Nigeria. It's not uncommon for banks to ask for a 20% yearly interest rate, which makes it very difficult for people in the lower and middle classes to buy a house. This is why most people only have the option of renting. There are some schemes set up by the
Another interesting result from this report is that Lagos makes up for 40% of the entire Nigerian market. For a country that's bigger in size than France, this shows very clearly what the impact of Lagos is on the rest of the country.
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government to make it possible for people to loan money at more affordable rates, but this is only available to a small group of people. There are some things to keep in mind when investing in a country like Nigeria. Although it is developing at a fast pace, there's still a lot of progress to be made. For example, the extreme poverty in the country leads to a lot of corruption, all the way up to the police and government level. If that's not enough, terrorist organisations like Boko Haram are causing a lot of mayhem to society and eventually to the country's economy. Because the level of corruption is so high, you have to be careful who you do business with. Many real estate brokers will lie or hold back information about certain real estate's profitability. It would be well advised to do a lot of research and ask around at a lot of real estate agencies before making any investments. Because the Nigerian culture – as with other local cultures – is much different from those of countries outside of Africa, you could make use of a local assistant
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Price of friendliness If you have an appetite for risk, investing in Nigeria gives you access to one of the final frontiers
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igeria probably isn't the first country that comes to mind when searching for a lucrative foreign real estate market. It is, however, a market with a lot of recent growth and there's good reason to think this trend will continue. Ever since the beginning of the new millennium, Africa's economy has been steadily growing with Nigeria as its biggest contributor. The continent of Africa has shown an average yearly growth of 5% for the last years. This can be attributed to the oil industry for a big part but industries like a g r i c u l t u r e, c o n s t r u c t i o n a n d manufacturing also contributed significantly. The growth of Africa's population According to projections made by United Nations, the African population will increase significantly. The population will be growing at such a high rate that 40% of the total world population will be living in Africa in the year 2100. The reason for this fast grow is the very high fertility rate in this area. The average African woman gives birth to 5 children. The sub-Saharan areas of Africa are expected to have the fastest growing population in the world. It's expected that Nigeria will have a population of over 1 billion people, before the end of this millennium.
Nigeria’s President, Mohammadu Buhari
The housing demand is caused mostly by the large amount of young professional people in Nigeria, who want to enter the real estate market. In Nigeria, the median age is 18.2 years and half of the population are less than 18 years old. This should all but
The opportunities of Nigeria's economy Nigeria has Africa's strongest and most important economy. The demand for housing is Nigeria is so big that more than 700,000 new housing units are needed every year, to keep up with the growing population. This opens up a lot of possibilities for people looking to make a profitable real estate investment. 24
guarantee a strong demand for houses for many years to come. What about Nigeria's rental market? The rental market is the most attractive real estate market to invest in. A research done by a real estate research company in Nigeria, has shown that about 60% of the working population in Nigeria's capital of Lagos, rents some form of real estate. Renting is popular because the houses are too expensive for most people. It's also hard to get a mortgage at a favourable rate. It's very inviting to rent out property in Nigeria as landlords here have a strong position. It's very common for rent contracts to be paid 1 to 3 years in advance. When the renter leaves the house before the rent period is finished, there will not be any refunds. This reduces the risks that are involved with renting out property. Increasing demand for shopping malls in Nigeria As Nigeria's population is growing and has more money to spend than before, the need for state of the art shopping
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Built on a creative bent
Landscaped garden provide the safe backdrop for safe jogging and walking. Four swimming pools and Tennis 1004 Estate Limited was established by a group of investors in 2004 to acquire 1004 housing estate in Victoria Island, Lagos after it was put up for sale in 2004 by Courts provide a vibrant sporting life style for residents. the Federal Government. The estate is now the most well equipped in Nigeria In fact, 1004 estate has indeed proven to be a roaring success story for e s p o n s i b l e f o r t h e and passion for delivering exceptional all property investors as the capital r e d e v e l o p m e n t a n d service to our clients which have values have risen by over 150 per cent repositioning one of the most contributed to the immense popularity on the two bedroom, three bedroom ergo success the facility has achieved sought after real estate facilities in and four bedroom flats since its reNigeria with a revered history, 1004 since reopening. opening. 1004 Estate is the largest single 1004 Estates Limited opened sales Estate Limited was established by a luxury high group of rise estate in investors in Sub Saharan 2004 to Africa and acquire 1004 comprises housing over 1004 estate in f l a t s , Victoria maisonettes, Island, s t u d i o Lagos after apartment in it was put up the Victoria for sale in Island district 2004 by the of Lag os, federal Nigeria. government 1004 estates limited is a diversified in mid 2009 with payments and pre-sale of Nigeria. company dedicated to providing a Originally opened in 1979 as a high of 600 apartments with Zenith & UBA variety of services in the real estate amenity and upscale estate for the Bank funded mortgages to corporate industr y, Its ser vices includes: accommodation of senators and buyers in 1 (one) week (also the largest project/construction management, single day transaction of 2009) leading members of the House of property management, facilities Representatives and was subsequently to an over-subscription of the 1004 management, estate agency, security units available. On completion the occupied by senior Federal Civil services, cleaning services, landscaping servants until its acquisition by 1004 estate has now attained 95% occupancy and horticultural services and so much Estates Limited for N7 billion due to its excellent location in the heart more. representing the single largest property of the Victoria Island business and Expanding its market capacity, 1004 recreational district coupled with its transaction in 2007. Estate Limited is now focused on The company commenced c o n s t a n t p r o v i s i o n o f providing other exemplary real estate refurbishment of the estate in 2008 power/recreational facilities and its projects with emphases on living, secure environment. Its larg e which involved the stripping, working and creating innovatively replacement of all internal in all their development. Their mechanical and electrical professional staff has over 30 fittings. Internal and external years combined experience in the partitions refurbishment was property development and completed in 2010 and the facilities management business. estate is now occupied and Their flagship project, the directly managed by 1004 1004 estate, remains one of the Limited. most sought after residential 1004 Estates Limited facilities in Lagos State. comprises a team of highly For reinventing, repositioning experienced management team and maintaining 1004 estate as the with diverse expertise in model for upscale residential Business. With a strong belief facility and their commitment to in entrenched values, ethics excellence, we salute you!!
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Enriching the automobile world Since its introduction to the Nigerian market, Kia motors has employed competitive marketing strategy and customer service in pushing the Kia brand into the top of mind position it now occupies in Nigeria.
pushing the Kia brand into the top of mind position it now occupies in Nigeria. Their success in marketing the Brand is such that Dana Motors limited received the Distributor of the Year Award from Kia motors in 2003 and the Award for Outstanding Effort and dedication in 2006. Kia motors represents affordable and cost efficient automobiles ranging from passenger sedans to commercial and special vehicles and at various times has contributed to the socio-economic development in Nigeria. Through Finance Schemes, competitions and donations, Kia Motors Nigeria has partnered with i n s t i t u t i o n s, s t a t e s a n d o t h e r organizations affording personal and commercial vehicles to both states and individuals. Since its initial showroom opened at the highbrow Victoria Island area of Lagos, showrooms have been opened at Abuja, Kano, Aba and Port Harcourt and Kia is on its way to ensure nationwide coverage is achieved. Kia's success is the result of intensive marketing and advertising backed by excellent product quality and after sales service commitment. Kia motors Nigeria has also been appointed as the regional training center (RTC) for the entire West Africa Region. For their commitment to pace setting and their constantly expanding strategic positioning, we salute Kia motors.
2016 Kia Sorento
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ana Motors Limited a subsidiary of Dana-group is the Sole-distributor of the World famous Kia brand of vehicles manufactured by KIA Motors Corporation, South Korea one of the world's fastest growing automobile companies. Headed by Mr. Jacky Hathiramani, a leader with an impressive business acumen whose business innovations have enabled Dana g roup to successfully foray into diversified fields in new product lines. An honors graduate in Business Administration from the European Business School of London, He Has since 1997 been responsible for strategically direction the group in its mission to build a formidable niche in Nigeria as a conglomerate dealing wishing several sectors of the economy. He has steered Dana Group to its current status as a leading player in the Nigerian business & economy sector and has seen the group increase its turnover manifold. Since its introduction to the Nigerian market, Kia motors has employed competitive marketing strategy and customer service in
Kia's success is the result of intensive marketing and advertising backed by excellent product quality and after sales service commitment.
Jacky Hathiramani
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Environment
December 14, 2015
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patch, and are much closer to their electorates than national politicians are. You might expect, therefore, that they would be paying little attention to the international climate talks currently being held between national leaders in Paris under the auspices of the UN. In fact, hundreds of mayors are in townand striking side deals of their own. More than 180 countries are gathered in Paris, and their pledges, it seems increasingly clear, will not hold global warming to the maximum 2째C rise above the level in pre-industrial times that politicians from around the world have set as their aim. The science behind this limit is hazy. Once chosen as from C40, a club for cities keen to be a safety-barrier intended to save the green, including Hong Kong, London world from catastrophic warming, and Rio de Janeiro, since 2009 its research increasingly suggests that vast members have adopted almost 10,000 damage will occur long before it is green policies, such as introducing a breached. And breached it almost congestion charge to cut traffic. Other certainly will be. What is needed is to policies that mayors can influence aim for "zero emissions", says Malte including promoting energy-efficient Meinshausen, a scientific advisor to the building and transport, upgrading waste German Environmental Ministry. But facilities to capture methane, pushing total global emissions are still rising. recycling schemes and setting tough Even holding them steady would be standards for office and commercial tough given the growing global lighting. A recent report from the population: each year the world is home Global Commission on the Economy to 83m more people, meaning and Climate, which researches the additional demand for transport, heat economic impacts of climate change, and light. reckoned these and other urban By 2030 cities will house more than measures could reduce annual energy three-fifths of the global population. costs around the world by almost $1.6 Cities already account for about three- trillion by 2030. This calculation quarters of energy-related greenhouse- assumed that energy prices would rise gas emissions; over the next 15 years by 2.5% above inflation each year; in mayors will oversee a growing share of recent months oil and gas prices such pollution. Given the political dropped to their lowest quarterly difficulties of passing environmental average since 2010. But there are other regulations at the national level, the importance of what mayors do to protect the environment will increase accordingly. What mayors promise during campaigns, their cities' residents pressure them to do once in office, says Mr Bloomberg. It is this "real accountability" that, in his view, means mayors could end up galvanising green policies. According to a new report World leaders kick off Paris climate summit 23
reasons, besides the fear of climate change, cities should cut back on emissions. Tackling smog would save many urbanites' lives: simply breathing the air in Beijing does harm comparable to smoking 40 cigarettes per day. Some city bosses are already persuaded. Clover Moore, Sydney's mayor, boasts that her city is saving A$800,000 ($587,000) a year thanks to LED lights in its streets and parks. Mr Bloomberg says that offering loans to change boilers in large buildings that run on heavy oil to more efficient, cleaner gas-fuelled ones has had a big impact on New York's emissions; overall they dropped by 19% between 2005 and 2013. And on December 4th more than 400 mayors gathered at a meeting in Paris to pledge impressive pollution cuts by 2030: according to an analysis by the World Resources Institute, a research group, they could end up reducing greenhouse emissions by 740m tonnes a year-more than Mexico's current total emissions. Even if the Paris talks culminate in a disappointing deal, they are drawing attention to the risks of climate change. And the more worried ordinary citizens are, the more likely they are to insist that their mayors keep their green promises High quality global journalism requires investment
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Environment
December 14, 2015
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The 2°C limit on global warming Given the assumptions made to argue that limiting warming to 2°C is possible, their demands will probably be glossed over.
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NEVER before has a responsibility so great been in the hands of so few," declared Christiana Figueres, head of the United Nations Framework Convention on Climate Change (UNFCCC) at the opening of COP21 in Paris. The UNFCCC, an environmental treaty, has been signed by more than 190 countries since its inception in 1992. Meetings under way in Paris represent the twentyfirst time its parties have met to divert global doom, arguing over climate and canapés. Under the treaty, all signatories agree to curb "dangerous anthropogenic interference within the climate system". And after a deal at another such meeting in 2010, they also agree on what "dangerous anthropogenic interference" actually means: global mean surface temperature increasing more than 2°C above that of pre-industrial times. But the history of this limit raises questions about its suitability to save the world. The two-degree maximum appeared initially in papers written by the Yale economist William Nordhaus in the mid-1970s. As "a first approximation" he suggested the world should not warm more than it had in the past 100,000 years or so-the period for which ice-core data were available.
Given how little was known about the costs and damages of global warming at that time, Dr Nordhaus admitted that the estimate was "deeply u n s a t i s f a c t o r y " . N e ve r t h e l e s s, European scientists discussed the twodegree limit during the next decade or so; in 1990 the Swedish Environment Institute produced a report that argued that, on the basis of "the vulnerability of ecosystems to historical temperature changes," warming above just 1°C was not advisable. The authors knew it was too late to keep within this level, and so suggested 2°C instead. From thence the maximum was adopted by the European Union's Council of Ministers in 1996; the G8 picked it up in 2009. During the chaos of the UNFCCC talks in Copenhagen that year, the two-degree limit emerged in
The simplicity of the two-degree maximum appeals to policymakers. It concentrates the complexity of climate change into one digestible figure, and tells politicians what to do about it. 22
glory, forming part of the deal made there between the world's biggest polluters. In 2010 it was enshrined within UN policy. The simplicity of the two-degree maximum appeals to policymakers. It concentrates the complexity of climate change into one digestible figure, and tells politicians what to do about it. Two-degrees is a safety barrier supposedly separating the world from catastrophic impacts-or some of the world, at least. Ice is already melting and coasts already flooding; communities on low-lying islands such as Tuvalu and Kiribati anticipate migration. These and other vulnerable countries want the warming limit to become 1.5°C in any Parisian deal. Given the assumptions made to argue that limiting warming to 2°C is possible, their demands will probably be glossed over. But the two-degree maximum is not as simple as it seems. Accurate m e a s u r e m e n t s o f t h e wo r l d ' s temperature are difficult to obtain: discrepancies mean arguments rage over whether a hiatus in warming occurred in the 15 years or so to 2013. And different parts of the world warm at different rates, for example, with the Arctic heating up twice as quickly as the global average. A limit linked to the concentration of greenhouse gases in the atmosphere could be better: such gases mix quickly and so can be sampled easily. Some argue that levels of soot and methane and ocean-heat content should be watched more closely, too. But to reach new international agreements on these alternative indicators is unfeasible. The two-degree maximum is imperfect, and will almost certainly be breached. But its existence focuses negotiations. And, when more than 190 countries have to agree, that may be enough to prove its worth. Local policies can combat emissions where international ones fall short "INTERNATIONAL agreements don't matter to mayors," reckons Michael Bloomberg, a former mayor of New York. City bosses are busy enough dealing with problems on their own
I N S I D E B U S I N E S S A F R I CA
IBCA 2015
December 14, 2015
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Making the difference Casbel Limited prides its selve as an "odd product and services" company committed to safe, reliable and optimization of solutions in buildings, residential, industry and power sectors.
Mar & Mor: 2.5MVA Distribution Transformers (Lakeview Estate Lekki)
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asbel Limited was established in May 1997 as a one stop shop for electrical engineering services, manufacturing, maintenance, installation up to 33KV systems, commissioning and procurement with a par ticular focus on electrical distribution, industrial controls, automation and extra low voltage. We pride ourselves as an "odd product and services" company committed to safe, reliable and optimization of solutions in buildings, residential, industry and power sectors. The management has always pride itself with the staff strength since inception of the organization. With a highly skilled team and the ability to harness the dormant knowledge of the many retired experienced practical engineers that litter the country. The core people of the organization has worked several years with notable organizations like; Cutler-Hammer and Schneider Electric both global companies specializing in manufacturing of electrical distribution switchboards, industrial controls, automation and building management
systems. The team skills, competences and capabilities are derived and strengthened by embarking on constant training of the staff leveraging on the long time association with global companies in the organization's trade group. Casbel limited has the necessary tools and support for design, execution and can provide hands on skills for projects and knowledge transfer to other team members.
Casbel limited has the necessary tools and support for design, execution and can provide hands on skills for projects and knowledge transfer to other team members 15
The company's competence in proffering solutions and services cannot be over emphasized. Some of the various areas the company is known for are; Medium voltage switchboards of different types: 33KV panels, 11KV panels, Power and distribution transformers. While the low voltag e switchboards are; Distribution panels, Manual and automatic changeover, Feeder pillars (MCCB & Fuse ways) The Industrial control & automation includes; Motor starters, Motor control centers, Custom built controls. They also deal on extra low voltage like; Wiring devices, Prepayment meter & vending, Simple building automation, Voice and data, Closed circuit TV system, Access control system. In terms of support Casbel Limited, cannot lead you half way in any projects; the following are some they are capable of giving high level technical support through the team of trained engineers which ensure fast answers to all technical enquiries and any services required at all time. Design stage: they also assist with optimization of functions, meeting the desired requirement and budget. Other areas include specification; in which they ensure application and assistance with product & equipment specification and selection are carried out with key interest. In the area of manufacturing and implementation, the firm manufactures panels to customer design, specification and to international standards. For quality they are committed to product integrity tests, full simulation sequence of operation check and routine tests before dispatch. The organization also assist in start up, and are available to support other organizations maintenance team in commissioning of our equipment and panels, interfacing and integration with other equipment on site. Training remains key in this business, so Casbel limited takes training seriously making sure its staff conducts
I N S I D E B U S I N E S S A F R I CA
IBCA 2015
December 14, 2015
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structured training for individuals or groups using in house facilities where available for ELV, LV & MV panels and LV design software. After sales services is also another area the company is known for over the years, providing round the clock emergency call out which includes on the spot repairs and immediate failed component replacement or upgrade. Casbel limited records in the power and energy sector is remarkable in terms of projects delivery. Some of the projects done across the country includes; University Teaching Hospital, Ibadan, Jos University Teaching Hospital, Jos, Federal University of Technology, Minna, Axari Hotel, Calabar, Hilton Hotel, Abuja, NIPRD Laboratory, Abuja, NNPC Pension Fund Estate, Abuja, National Bureau of Statistics, Abuja, Cosharis plaza, Abuja, Pinnacle Plaza, Abuja, ULO Plaza, Abuja, Jalingo Airport, Jalingo, PHCN, Kaduna, National Hospital, Abuja, Diagnostic Centre, Ilorin, Kwara Shopping Mall, Ilorin, Lakeview Estate, Lagos, Jacob Mews Estate, Lagos, National College of Petroleum Studies, Kaduna, College of Medicine (LAUTECH), Ogbomosho
Others in the area of power are: Income Electrix Nig. Ltd, Port Harcourt, Kisma Maski Nig. Ltd, Ogbomosho, Oscar Fibre Nig. Ltd, Lagos. 7Up Plc, Ikeja For residential buildings Casbel limited has delivered mouth watering projects in the country such as: HFP Engineering, Lagos, Rofasy Nigeria Limited, Abuja, Ahmak Eng. Ltd, Ibadan, Debour Nig. Ltd Other outstanding records of the company includes; Lighting/fan control panel for Blessed Fatson (FUT, Minna), 800A Fuseway feeder pillar for Demech (Eket, Akwa Ibom), 2000A Automatic mains failure for Promasidor Nig. Ltd, Lagos, 600A Motor control centre for MMNL Axari Hotel, Calabar, LV panels for Frate Nig. Ltd, NNPC Pension Fund Estate, Abuja, Motor control centre for Blessed Fatson: National Bureau of Statistics, Abuja, 800A/1200A MCCB feeder pillar for Income Electrix (NAOC, Port Harcourt), LV panels for Mar & Mar Integrated Services Ltd, Kwara Shopping Mall, Ilorin, 500KVA package substation for Kasram Nig. Ltd, (National Hospital, Abuja), Consumer unit/distribution board
Speaking the same language Nigeria, Japan Bilateral Trade Soars to $528billion
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rade volume between Japan and Nigeria has hit a record $5.28 billion, the Trade Commissioner and Managing Director, Japan External Trade Organisation (JETRO) Taku Miyazaki, revealed. According to the commissioner, the Japanese companies were keen on expanding their businesses in the country with high technology. To this end, Miyazaki urged the government to make the environment conducive for Japanese companies to operate. He said some of the draw backs that may deter would-be investors from his country are poor infrastructure such as electricity as many of the prospective
Shinzo Abe, Japan's prime minister
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(ICT centre), 500KVA substation for Beamco Nig. Ltd, (National College of Petroleum Studies, Kaduna), Energy meter/distribution board for Great Brand, Lekki, 11KV outdoor package substation for 7Up Bottling Co. Plc, (7Up Plant, Ikeja), LV Panels for ElMansur Atelier (Pinnacle Plaza, Abuja), o t h e r s a r e : 8 0 K VA U P S a n d changeover for Beamco Nig. Ltd., National College of Petroleum Studies, Kaduna, Transformer Control Relay Panel for Income Electrix (PTI Warri), Low voltage panel/Power supply for Frate Nig. Ltd, Multilevel Car Park, Abuja, LV Panels for El-Mansur Atelier (ULO Plaza, Abuja), LV panel for Family Worship Centre, Abuja, LV Panels for Blessed Fatson (JUTH, Jos), LV Panels for Rofasy Nig. Limited (FUT, Minna), 11KV SM6-24 for Mar & Mor (Lakeview Estate), LV Panel/RMU for Blessed Fatson (UCH, Ibadan), 800A Changeover/LV panel for HFP Engineering, Lagos. The contribution of Casbel Limited to the nation’s economy and capacity building has earned the firm lots of commendation and Inside Business A f r i c a c o m m e n d t h e f i r m ’s achievements investors are manufacturers who are also desirous of good roads, good regulatory environment, efficient judicial system, attractive import regulatory environment and security of lives and investment. “Nigeria ordinarily should be the toast of investors if the necessary things are put in place especially in terms of effective and efficient infrastructure provision such as electricity, motorable roads, effective and consistent regulatory authorities, and standardization that will discourage the importation of fake and cheap products from other Asian countries,” he said. He said in 2014, both import from Japan to Nigeria and export from Nigeria to Japan increased significantly. According to him, import from Japan mainly consisted of machinery, steel products and vehicles valued at about $728 million, representing 21.0 per cent more than 2013 figure.
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Government & Policy
December 14, 2015
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said President Muhammadu Buhari had interest in seeing to the early completion of the Lagos-Ibadan Expressway. Also, as part of efforts to ensure optimal use of the nation’s road infrastructure, Fashola insisted on reclaiming the full width and setback of all federal roads, admonishing all those who had infringed on them to begin to move away in the interest of the public. He said: “The records that have been made available from previous budgets show that the last time Nigeria budgeted over N200bn in a year’s budget for roads was in 2002. It seems that as our income from oil prices increased over the last decade, our spending on roads decreased. “As far as status reports go, the Federal Government budgeted N18.132bn in 2015 and the Ministry of Works got N13bn for all roads and highways in 2015, although it has contracts for 206 roads, covering over 6,000km with contract price of over N2trn. “Our ability to achieve connectivity of roads depends on capital spending in 2016 to pay contractors and get them back to work. “Our short term strategy will be to start with roads that have made some progress and can be quickly completed to facilitate connectivity. “We will prioritise within this strategy by choosing first, the roads that connect states together and from that grouping, start with those that bear the heaviest traffic.” He noted that stoppage of road projects due to failure of government to pay contractors had resulted in acute job losses, adding that over 5,150 workers had been laid off in four major construction companies in the country. On plans by government to reclaim highways that had been encroached on, the minister said: “In order to make the roads safer, we intend to re-claim the full width and set back of all federal roads, representing 16 per cent and about 36,000km of Nigeria’s road network by immediately now asking all those who are infringing on our highways, whether by parking, trading, or erection of any inappropriate structure to immediately
Toll Gate in Lagos
remove, relocate or dismantle such things voluntarily. “This will be the biggest contribution that citizens can offer our country as proof that we all want things to change for the better. “For clarity, it is important to say that although state governments own 18 per cent of the total road network of about 200,000km, while local governments own the balance of 66 per cent, the 16 per cent owned by the Federal Government carries an estimated 70 per cent of the total traffic because of their length, width and inter-state connectivity. “For those who seek us to compel them to stop these habits of the past, our resolve to do so will be unyielding, because that resolve represents the will of the majority of Nigerians expressed through 15,424,921 votes of Nigerians who mandated our president to effect change.” As part of strategies to ensure continued maintenance of the nation’s highway, the minister said his ministry would bring back tolling system as well as Road projects due to failure of government to pay contractors had resulted in acute job losses, adding that over 5,150 workers had been laid off in four major construction companies in the country 21
undertake the construction of weigh bridges. He maintained that the installation of weigh bridges would enable the country elongate the lifespan of her roads, insisting that road users would rather comply with the specified load requirement or be made to pay heavy fines. Also speaking on the strategies to address the various inhibitions to housing provision in the country, the minister stated that the immediate priority of government was to review the National Housing Policies. Apart from that, he noted that government would lead the aggressive intervention to increase supply by undertaking construction of public sector participation and ownership with a view to reducing the current housing deficit put at 17 million units. The minister, who averred that the country must rev up national housing budget from the current N1.8bn to hundreds of billions if it must meet its housing needs, however doubted the accuracy of the much touted 17 million units deficit. In order to enable the present administration adequately prepare to address the shortfall, Fashola said the ministry would undertake a process of scientific assessment to define the accuracy of the 17 million figure as well as the actual demand.
I N S I D E B U S I N E S S A F R I CA
Government & Policy
December 14, 2015
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I N S I D E B U S I N E S S A F R I CA
IBCA 2015
December 14, 2015
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Unveiling the change infrastructure agenda
Farmers’ preferred choice
Fashola unveils plans for power, road projects •Targets 22 power plants in 12 months •N2trn required to fix ongoing 206 roads
Prmier Seed Nigeria has built up a clientele bas across Nigeria that makes it the preferred choice of farmers for all research and seeds need
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inister of Power, Works and Housing, Babatunde Fashola, has unveiled his short and medium term plans for the revitalisation o f t h e n a t i o n ’s d i l a p i d a t i n g infrastructure. In his maiden interaction with journalists in Abuja last Tuesday, the former Lagos State governor stated that paucity of funds had compelled the present administration to prioritise its intervention in power, road and housing sectors. He briefed alongside his Minister of State for Power, Works and Housing, Mustapha Shehuri, and Permanent Secretaries in the ministries, Louis Edozien and Gambo Magaji, respectively. In the area of power, Fashola said there was a significant low budgetary provision for the sector in 2015, adding that there were 142 transmission projects that were near completion, out of which 22 could be completed within a year at an estimated cost of N40bn. “There is a 10 megawatts wind energy project in Katsina nearing completion, a 215mw plant in Kaduna and the Minister of Power, Works and Housing, Babatunde Fashola
3,050mw plant in Mambilla, Taraba State, all of which need to be completed. “Our first priority is to get contractors to finish on-going transmission contracts to enable us transport the power being generated to the Discos to distribute. “Our second priority is to ask the governors to help us identify and enumerate their most populous industrial and commercial clusters where manufacturing, fabrication, welding and related productive work is going on, especially by small businesses and to see how we can use the existing legal framework to attract embedded power supply to these people who must be ready to pay for the power. “The owners of the Discos will be expected to give us their co-operation through flexibility and innovative disposition for emergency interventions while they plan and develop their wholesale roll out plan. “Our economy cannot wait indefinitely and suffer job losses. If we succeed, we can get a lot of workers back to work in cottage and small industries which are the critical driving forces of our economy,” he said. The minister also stated government’s intention to continue to slowly standdown and allow market forces drive the electricity sector; as well as rectify disparity in price of gas to power plants and quickly resolve extant issues between it, owners of the Aba Power and Enugu Electricity Disco. “Government is n ow a r e g u l a t o r through the National Electricity Regulatory Commission, NERC, which is like the N a t i o n a l Communications Commission, NCC, 20
which regulates Telcos. “We intend to strengthen this part of our responsibility so that we can hold the Gencos and Discos to their contracts with citizens. But before we do that, we must play our own role of providing gas and expanding the transmission network,” he said. Fashola said he would task government agencies across the country on timely payment of bills for electricity supplied to them to eliminate revenue losses by the Dicos. “More importantly as a government and consumer of power through our ministries, departments and agencies, we must show example at federal, state and local governments by paying up backlogs of power bills and ensuring from there that we pay for what we use. “Our ministry intends to champion this at the federal level and I hope that the state governors, heads of parastatals, national and state assemblies, the various state and federal cour ts, local governments, military, police, and other related security agencies will find this a worthy undertaking to join and ensure payment of all their electricity bills,” he noted. He also explained that the Nigerian National Petroleum Corporation, NNPC, had agreed to provide fund and pledged to complete gas lines that would add up to 2,000mw of power to the national grid in the next 15 months. In the area of road infrastructure, the minister noted that whereas it would require N2 trillion to complete the 206 ongoing projects spread across the sixgeo political zones, N13 billion was released out of the N18.132 billion provided in the 2015 budget. In order to navigate the financial hurdle, Fashola stated that the ministry’s short term strategy was to concentrate on roads that connect states and those that bear heaviest traffic. However, in view of its strategic significance to the economic development of the nation, the minister
After reaching maturity in about 45 days, chives are harvested every 20-25 days for up to three years. (Image source: Premier Seeds)
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ith Agriculture as the original economic base of the Nigeria, Premier Seed Nigeria is the oldest ad foremost private seed company in Nigeria, engaged in research, production and marketing of improved seeds of field crops and vegetables to farmers Nationwide and in the Wes Africa sub-region, to boost agricultural productivity. With Nationwide distribution, Premier Seed Nigeria produces high quality certified seeds through a network of successful and sustainable Out-growers scheme based on a foundation seed of high genetic purity. Premier seed is involved in Research, production and marketing of seeds of hybrid and open pollinated maize, rice, sorghum, millet, soybeans, cotton, cowpea, groundnut and assorted vegetables (exotic and local). Through a streamlined departmentalization of operations and t h o r o u g h q u a l i t y ch e ck s a n d assessment, Premier Seed remains at the forefront of the agricultural sector with their commitment to ensuring
With a strong research base, Premier seed is constantly working with the best to ensure seeds are produced to endure the ever changing landscape of nature especially at this period with worldwide climate change. 17
high quality standards of every seed. With a strong research base, Premier seed is constantly working with the best to ensure seeds are produced to endure the ever changing landscape of nature especially at this period with worldwide climate change. Premier Seed is associated with many Pro-Agriculture initiatives and has collaborated with various institutions and states within and outside the country to promote sustainable agriculture and re-position agriculture as a relevant presence in the Nigerian economic structure. Collaborations on projects with international bodies committed to global growth such as the Bill & Melinda Gates Foundation, and collaboration with Borno State, Kano & Katsina States on various projects including Cowpea production, tolerant maize among others have positioned premier seed as major agricultural front runners in Nigeria. Premier seed has received various awards for their leading role in the seed sector including the National Top Quality Improved Agricultural Seeds Production and Marketing Company of the year 2009 and West Africa's Best Agricultural seeds company of the year 2009. Premier seed is headed by a highly distinguished body of professionals and Technocrats lead by Dr.M.O Omidiji as the Chairman and Prof. A.O Ogungbile as the Managing Director/CEO For their contribution to agriculture in Nigeria, they are worthy recipients of the IBCA. Congratulations.
I N S I D E B U S I N E S S A F R I CA
Oil & Gas Report
December 14, 2015
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Hurting the economy Remove oil subsidy now, World Bank tells Buhari
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gainst the backdrop of the current fuel crisis across the country showing no sign of abating, the World Bank, yesterday, told President Muhammadu Buhari that the time to remove petroleum subsidy is now. While the Buhari administration has given hints of its intention to remove fuel subsidy, many Nigerians, including the organised labour, have rejected the plan. But in what appears to be a prelude to the eventual removal of fuel subsidy, President Buhari made no provision for kerosene subsidy in the Medium Term Expenditure Framework, MTEF, and Fiscal Strategy Paper, FSP, which he presented to the National Assembly, yesterday.budget At Monday’s Federal Executive Council meeting, the Minister of Budget and National Planning, Udoma Udoma, while unveiling the Medium Term Expenditure Framework and the government’s N6 trillion budget proposal for 2016, said the government was seriously weighing the options between removing or retaining fuel subsidy next year. Speaking at the launch of the new edition of Nigeria Economic Report, the World Bank’s Lead Economist, John Litwack, said the best time to remove fuel subsidy is now when global crude oil price
is at its lowest level, noting that the Bank foresaw continuous decline in global crude oil price. Despite last Friday’s attempt by the Organisation of Petroleum Exporting Countries, OPEC, during its 168th conference to maintain its production quota so as to stabilize the crude oil market, the price of the commodity slumped further to $37.89 per barrel on Monday from $38.09 on Friday. Mr Litwack said now is the best time for the government to scrap the subsidy, as doing so would not push retail pump price beyond an average of N100 per litre, or generate the kind of pressure that would negatively impact on the people beyond what they are currently facing. According to Litwack: “The fuel subsidy appears to have vast modest benefits for the majority of citizens, but the costs are quite high. There is a strong tendency for the cost of fuel subsidy to increase over time as increasing domestic demand for petrol outpaces growth in oil output or revenues. “The $35 billion cost of fuel subsidy during 2010 – 2014 was one of the reasons Nigeria was unable to accumulate a fiscal reserve in the Excess Crude Account that could have protected the country from the recent oil price shock.” He explained that fuel subsidy 18
obligations were expected to reach 18 per cent of all government oil revenues in 2015, pointing out that if the current regulated price regime of N87 per litre was maintained, subsidy was projected to increase to more than 30 per cent by 2018. 2016 Budget: Buhari scraps kerosene subsidy Meanwhile, President Muhammadu Buhari may have tacitly scrapped kerosene subsidy in the country as he made no allocation for it in the Medium Term Expenditure Framework, MTEF, and Fiscal Strategy Paper, FSP, which he presented to the National Assembly, yesterday. The document indicated that the present federal administration is to borrow N1.835.88 trillion to fund the 2016 budget which stands at N6.04 trillion just as it disclosed that a total sum of N350.33 billion misappropriated funds will be recovered in 2016 . A breakdown showed that while N1, 200.00 trillion would be borrowed domestically, foreign borrowing stands at N635.88 bn. On the misappropriated funds, the president explained in the Medium Term Expenditure Framework that N137.90 billion will be recovered from strategic alliance contracts, while N162.43 billion will be recovered from the Nigerian National Petroleum Corporation, NNPC just as N50 billion will be recovered from other misappropriated funds. But contrary to expectations that he would remove fuel subsidy following series of complaints arising from its handling, the President did not only retain it but allocates the sum of N63.29 bn for it in the 2016 fiscal year.buh Also, in his efforts at fulfilling his 2014 electioneering campaign promises, President Buhari allocated the total sum of N500 billion for Social Welfare Intervention Programmes Initiative, conditional cash transfer to the most vulnerable and post-NYSC grant. He explained that “these interventions will start as a pilot scheme and work towards securing the support of donor agencies and our development partners in order to to minimize potential risks.” N39.88 billion for oil exploration in the North The president, according the
I N S I D E B U S I N E S S A F R I CA
Oil & Gas Report
December 14, 2015
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document, is expected to spend the sum of N39.88 billion for exploration of oil in the northern part of the country in the, 2016 fiscal year. According to the MTEF submitted, the sum of N150 billion was earmarked for settlement of arears of the 2015 subsidy on domestic consumption. This came as he slashed the yearly budget of the National Assembly from the sum of N120 billion contained in the 2015 budget to N115 billion in the 2016 fiscal year. He equally trimmed down the allocation for Presidential Amnesty Programme from N47.39 billion to N20 billion. To improve revenue generation and collection as well as plugging leakages, the president said his administration had commenced a forensic audit of key revenue generating and collecting agencies of government with a view to recovering lost revenues as well as identifying and blocking loopholes for poor collection and remittance of revenue in the treasury. The president added that the multiplicity of government accounts had made it difficult to have an accurate picture of public financial resources. “Government has, therefore, enforced the full implementation of the Treasury Single Account, TSA system. Already, this is facilitating a more effective aggregate management and control of government cash balances, which, hitherto, had been maintained in several bank accounts. “Government has similarly, enforced the full implementation of the integrated payroll and personal information system, IPPIS in all MDAs, which should result in some cash, “he explained. President Buhari hinted of possible job cut as well as mass reduction of MDAs, when he said: “Government will, in the near-to-medium – term, continue to prune the size of federal government and its MDAs to more efficient levels without compromising effectiveness. “Over the Medium-term, however, government will revisit the need to rationalize the agencies of government and strategically implement relevant provisions.” The president said the 2016 Budget, standing at N6.04 trillion, proposed government revenue of N3.82 trillion,
Dr. Emmanuel Ibe Kachikwu, Minister of State Petroleum
implied a projected deficit of N2.22 trillion. No hope in sight, as fuel scarcity bites harder The fuel crisis continued in Abuja, yesterday, as motorists continued to find it more difficult to get the product, with some queueing for a minimum of four hours before getting the product to purchase. The fuel crisis showed no sign of abating, as the queues continued to grow longer while the number of petrol stations with the product continued to decline. Despite the sufferings, the Federal Government, the Department of Petroleum Resources, DPR and the NNPC, seem to have abandoned Nigerians to their fate, as they have kept mute in spite of the worsening situation. The DPR failed to respond to enquiries on its efforts at alleviating the sufferings faced by Nigerians, while the NNPC had stopped sending its daily update of supply to petrol stations across the country. In Suleja, most petrol stations were
Despite the sufferings, the Federal Government, the Department of Petroleum Resources, DPR and the NNPC, seem to have abandoned Nigerians to their fate, as they have kept mute in spite of the worsening situation. 35
selling fuel to motorists, but the queues were long while motorists accused the filling stations of under-dispensing, claiming that their pumps had been tampered with. At the Airport Road in Abuja, most of the petrol stations were not opened when Vanguard visited, while the few selling, NNPC and MRS, witnessed large number of vehicles and very long queues. In Lugbe, only MRS petrol station was selling, while the other petrol stations where shut down, claiming they have ran out of the products to sell. At the Conoil and Total petrol stations opposite the Nig erian National Petroleum Cor poration, NNPC, headquarter in Abuja, the queues had gone round about four streets, inhibiting traffic in the process. At the Forte filling station in Gudu, a long queue was seen, with motorists spending long hours on the queue, while the situation was no different at Yaman petrol stations in Area 3, Garki, Abuja. In Gwarimpa, most of the petrol stations were shut, including the NNPC station inside Gwarinpa , as the station was shut to motorists. Along the Abuja – Keffi Expressway, only Forte Oil at Nyanya was selling, while all the NNPC retail outlets around Nyanya were shut down. Along the Kubwa expressway, the large queues witnessed at the NNPC retail outlets at Katampe and Total filling stations continued and showed no sign of improvement. Some motorists told Vanguard that they have been on the queue for about four hours and called on the Federal Government to do something about the situation. Due to the worsening scarcity, widespread incidences of sharp practices were recorded in most petrol stations, with rising cases of under-dispensing, hoarding and exploitation. Also, most petrol stations no longer sell to motorists during the day, as they only sell at night when they feel they could get away with whatever sharp practices they are engaged in. Most of them sell to black market dealers in drum and other large containers at the dead of the night, while during the day, they claim they do not have products to sell.