The Nation Newspaper

Category: Industry

  • Agency to pay shareholders $2.5m

    In a much-anticipated announcement, the African Trade Insurance Agency (ATI) has declared that its General Assembly had approved the first-ever payments to shareholders who will get $2.5million.

    ATI made this known at its Annual General Meeting (AGM) held in Abidjan, where the company also announced its record-breaking 2017 financial results for the sixth consecutive year.

    The company’s Chief Executive Officer (CEO), George Otieno noted: “We have been planning for this moment for several years and I am happy to finally announce that we are ready to give something back to our shareholders. This signals our intention to continue showing value to our member-governments and shareholders, while providing non-member-countries and institutional investors an incentive to join.”

    In 2017, ATI recorded gross exposures of USD2.4 billion and, in the same period, the company covered investment and trade activities across the continent valued at USD10 billion. ATI also posted a USD10 million profit representing a 55 per cent increase over 2016.

    ATI owes its strong results in part to growing demand from investors and African governments for their products as the continent continues to position itself as an attractive destination for investors. Africa’s drive to increase trade within its borders is also fuelling ATI’s success.

  • ActionAid, ECOWAS, others seek improved safety measures on food

    Stakeholders in the agriculture sector have called on the government to ensure proper safety measures on local and exportable produce to improve food security.

    The stakeholders, which included ActionAid Nigeria and the ECOWAS Commission, in a communiqué, at the end of a two-day Consultative Meeting on 2019 Agriculture Budget, rued the poor food safety and phyto-sanitary measures identified with some agricultural commodities, including yam and beans.

    The communique was signed by Mr. Azubike Nwokoye, coordinator, Food and Agriculture Programme, ActionAid Nigeria.

    They stated that there was the need for the Federal Government to channel more of its agricultural investments to the production of locally-fabricated simple farm machines. It noted that the farm implements should match the soil requirement of agro-ecological zones and be easily accessible to smallholder farmers.

    “Sanitary and Phyto-sanitary (SPS) measures and general food safety issues have been identified with some Nigerian agricultural export commodities such as yam and beans. It is important that food safety issues for both domestic consumption and export markets are improved upon. The 2019 and subsequent years agriculture budget should be gender sensitive,” the communique read.

    The stakeholders, while commending the government for the continuous increase of agriculture budgets since 2016, said there was a need to increase agriculture budget to hit 10 per cent of the national budget as provided by the Maputo/ Malabo declarations by 2019.

    According to the communique, farmers, especially smallholder women farmers, who produce over 60 per cent of food consumed in Nigeria, are not involved in agriculture budgeting.

    It said there was no strategy to involve women farmers and this had resulted in untapped potential of women farmers and the attendant low agricultural productivity.

    The stakeholders called for adequate monitoring of the implementation of agriculture projects.

    Stakeholders from Oxfam, Nigeria, the Ministry of Budget and National Planning, the Federal Ministries of Agriculture and Rural Development, Environment and Water Resources, and the Small Scale Women Farmers Organisation of Nigeria (SWOFON) attended the meeting.

    Others were representatives from the Association of Small-Scale Agro Producers in Nigeria (ASSAPIN); the media, academia, Research& Finance institutes as well as Civil Society Organisations (CSOs).

  • BoI, UNIDO partner to boost industrial development

    The Bank of Industry (BoI) and the United Nations Industrial Development Organisation (UNIDO) are collaborating to drive the Federal Government’s Economic Recovery and Growth Plan (ERGP), through inclusive and sustainable industrial development.

    UNIDO Regional Director and Representative to Nigeria and ECOWAS Jean Bankole made this known during a visit to BoI’s office in Lagos.

    Bankole said the partnership would was a catalyst to the attainment of the Nigeria Industrial Revolution Plan (NIRP) and its Vision 2020 Agenda.

    According to him, UNIDO has started a four-year country programme for Nigeria, and requires the government’s support and strategic alliances for its funding and implementation.

    “We are here to seek your support and to ensure that the programme is well implemented to drive industrialisation plan and diversification of Nigeria’s economy.

    “We need to create the condition that will build economic resilience and positionNigeria to continue to play a key role in Africa and the global economy.

    “To do this, we need strong industrialisation strategies, partnerships and investment that will place the economy on the path of growth and sustainable development,” he said.

    Bankole said the country programme, estimated at $50 million, had identified intervention plans in nine thematic components that would assist Nigeria develop and grow its industrial sector.

    The areas are: Micro, Small and Medium Enterprises (MSMEs) development; industrial governance and funding, Special Economic Zones (SEZs), agro-industry and agri-business development, innovation and renewable energy development.

    The others include capacity building to improve quality of products and environmental management to reduce industrial pollution.

    Bankole said the programme would drive economic expansion and an inclusive growth to advance equitable opportunities for every section of the country.

    He noted that development of the industrial sector would create more jobs, enhance productivity and boost the GDP growth.

    Responding, BoI Managing Director Mr Olukayode Pitan said the bank would continue to partner UNIDO, and that its area of focus aligned with the bank’s activities and interventions.

    “Already, we have a long-standing relationship with UNIDO, and UNIDO has an office in our bank. I can assure you that we will partner more with you to take our country to higher heights,” he said.

    Pitan said the partnership would transform the structure of the economy and productivity, enhance the standard of living of its people and boost economic growth.

  • Budget 2018 implementation: Sectors to prioritise, by analyst

    A development analyst, Dr Otive Igbuzor, has advised the Federal Government to give priority to four sectors in the implementation of Budget 2018  to transform the lives of citizens and enhance sustainable development.

    Igbuzor, who is the executive director of the African Centre for Leadership Strategy and Development, said people were worried that health and education were not among the top three priorities in the budget.

    “We have always consistently advocated that if you want to budget to impact life of ordinary citizens, you must give priority to four sectors – infrastructure, agriculture, education and health.

    “You have seen from the 2018 budget presentation, the only one that comes top is infrastructure; there is higher allocation to security, understandably because without peace there cannot be development.

    “I think there is still room for improvement in terms of increase budgetary allocation to education and health,’’ he said in Abuja.

    Igbuzor, however, commended the National Assembly for putting over N55 billion for the implementation of the National Health Act, which is an increased allocation to the sector.

    He continued: “We have to do the percentage allocated to health later but the percentage of allocation to education, for instance is not up to 10 per cent. There are countries in the world like Ethiopia that budgets about 30 per cent for education. If you look at the level of education in Nigeria, it is clear that there is a need for improved allocation to education and health,’’ he said.

    He expressed concern over the consistent delay in the passage of budget over the past three years.

    According to him, the way to deal with it is by legislation, adding that that was why part of the constitutional amendment was to make it clear.

    Igbuzor advised that the way to go is to make it clear that the President must submit the budget before September and the legislators must approve before December.

    He added that once the law comes into force, then everybody must work within its ambit.

    On the way forward, he said the delay in the budget was because there was no law to address it.

    According to him, once there is no rule, then there is no offence.

    “They have not breached any law, so when that amendment passes through, then we will revert to January to December calendar,’’ he advised.

  • China lashes U.S over tariffs threat

    China has threatened to match the U.S with instant measures when tariffs take effect on Friday and lashes Donald Trump of threatening the world with tariffs.

    The U. S. is “opening fire” on the world with its tariffs threat, China insisted on Thursday but that Beijing would ramp up the rhetoric in a bitter trade dispute.

    The Trump administration’s tariffs on 34 billion dollars of Chinese imports are due to go into effect at 0401 GMT on Friday, which is just after midday in Beijing.

    U.S. President Donald Trump threatened to escalate the trade conflict with tariffs on as much as 450 billion dollars’ worth of Chinese goods if China retaliates, with the row roiling financial markets including stocks, currencies and the global trade of commodities from soybeans to coal.

     

     

  • CAMA Bill not perfect says LCCI

    The Lagos Chamber of Commerce and Industry (LCCI) has said the recent amendment of the Company and Allied Matter Act (CAMA) is not perfect to address concerns of the Nigerian business community.

    Stakeholders also argued that the bill lacked wider consultations from key sectors of the economy.

    LCCI president, Babatunde Ruwase, during a stakeholders’ forum on repeal and re-enactment of the CAMA 2018 in Lagos, said there are areas that need to be fine-tuned to ensure that the desired outcomes are realised.

    “The Bill was passed by the Senate and is currently awaiting the consideration of the House of Representatives. This is a window of opportunity that we would like to explore to make the necessary inputs,” he said.

    He acknowledged the fact that many provisions in the nation’s laws are not in tune with current realities, but stressed that recent amendments to the CAMA is not perfect to address concerns of the business community.

    “Some of these provisions have been in our statute books for 30 years or more and yet we are operating in a business environment which is very dynamic. Things are changing almost on a daily basis and shaping the way businesses are done,” the LCCI boss said, stressing that Nigeria could not afford a static legislation in a dynamic investment environment.

    He commended the National Assembly and other stakeholders in the private sector and civil society for their role in CAMA review, but stated that the amendment was not perfect.

    Also speaking at the event, a Professor of Commercial Law, University of Ibadan, Prof. Adekunle Aina, said the bill is obsolete and lacked a comprehensive review by key stakeholders, adding that the bill does not address some concerns such as minority protection, denture holders and floating charges.

    According to Aina, “sustainable governance has not been touched”. “Corporate Social Responsibility (CSR) is almost nonexistent under our laws. We are not even talking about sustainable governance to cater for the nation’s unborn generation. These are issues that should have been addressed in the bill,” he said.

    He added that Nigeria is not attracting social investments simply because of the absence of proper framework to attract Foreign Direct Investments (FDIs) in this regard.

     

     

  • Agencies’rivalry frustrating fight against substandard goods

    Eighty per cent of goods and products in the economy are either fake or substandard. Daily, regulatory agencies seize prohibited drugs and other life-threatening products at entry points of the country. While there are various regulatory government agencies to curb this menace, unhealthy competition among them and the inability to enforce the laws are barriers to their effectiveness and efficiency. Assistant Editor OKWY IROEGBU-CHIKEZIE writes that except steps are taken urgently, Nigerians will be the worse off for the festering rivalry among the agencies.

    In the last one year, the battle to rid the country of fake and sub standard products has been on the rise.

    For instance, the Standards Organisation of Nigeria (SON), over this period under review, claims to have confiscated over N6.5 billion worth of fake and substandard tyres alone imported through various borders. This is aside  cables, battery and other life-threatening products.

    Similarly, the National Agency for Food  Drug Administration and Control (NAFDAC) claims to have destroyed N3.5 billion worth of tramadol and codeine a few weeks ago. This is also aside from other seizures it has made, estimated to be worth over N1 billion.

    Worrisome however is the influx of these products into the country, believed to be mainly from China. Stakeholders have always pointed  fingers at China as the purveyor of these fake and substandard products

    But China-Nigeria Chamber of Commerce President, Ye Shuijin said most of the substandard products that come into Nigeria are not from China. He said the Chinese government has a well-structured standard and regulation in place for its products.

    “China products are of high quality; nonetheless the Chinese government is already cooperating with the Nigerian government to promote importation of quality products to Nigeria,” he said.

    Shuijin urged importers and consumers to be vigilant and reject any substandard product claimed to originate from China.

    Stakeholders are, however, worried that the various regulatory agencies put in place by the government are trying to outwit rather than complement themselves in this herculean task of overseeing quality of products coming into the country. Observers believe that if these agencies work to complement one another,  the nation would be better for it.

    But the scenerio at present does not give hope of abating anytime soon. Some agencies are kicking against others, thus further fuelling the rivalry.

    Recently, the government ordered NAFDAC back to the ports, a directive that seem not to have gone down well with  some others. For instance the Nigeria Customs Service (NCS) swiftly kicked against the  return of NAFDAC to ports, insisting that their physical presence at the prots is not needed before cargo can be released.

    To further accentuate this rivalry, and in similar vein, less than a month after NAFDAC got approval to return to the nation’s port and border posts, the Customs Area Controller in charge of Apapa Command; Comptroller Jibrin Musa, said that the NCS does not require the presence of NAFDAC in the ports to conduct 100 percent examination of cargo and release same. The agency’s return was to monitor the importation of sensitive chemical substances, food, drugs and other regulated products into the country.

    While receiving the members of the National Trade Facilitation Committee (NTFC), led by A. M. Abubakar as well as officials from the Japanese government, led by the country’s Ambassador to Nigeria, and NAFDAC officials led by Director in charge of Ports Supervision, who paid him a courtesy visit, Musa expressed the service’s displeasure at the development.

    He argued that provided the clearing agents have the documents, including the certificate by NAFDAC for the importation of the NAFDAC-related consignments, Customs would release the cargo.

    “The mandate as enshrined in the Executive Order is, if the importer or the clearing agents have all the necessary documents including the certificate by NAFDAC for the importation of the NAFDAC-related consignments, on presentation of the certificate, we don’t need to wait for NAFDAC to come for physical examination. Once they certify that the consignment is safe, we allow the consignment to be released. And most times, the agency sends their stoppage alerts after the goods must have been released” Musa explained.

    Reaffirming Customs position, the image maker of the Apapa Customs, Nkiru Nwala said it is not all imports that require the presence of NAFDAC officials at the ports.

    According to her, NAFDAC issues an alert to Customs if there is a questionable cargo being imported and the need for its officials to witness the examination.

    She said: “NAFDAC is the agency that is authorised as far as it is food and drugs, you must have their approval, that is why we have NAFDAC number on bottled water, so all drugs you are importing from abroad is supposed to have a NAFDAC number, there is a certificate behind that number, they (NAFDAC) issue the certificate and this is what you would present to Customs, it assures us that actually, you have NAFDAC approval”.

    “If the cargo does not have NAFDAC number, we would connect the importer to NAFDAC”, she explained.

    “If they (NAFDAC) have any concern about a particular import, they would notify and request that they would want to be part of the examination, but it is not every import that requires NAFDAC presence” she stated.

    This is the same for operators in the Maritime sector who think that SON and NAFDAC are a clog in the wheel of their progress and must be stopped from entering the ports.

    They faulted Federal Government for countering its earlier directive restricting the number of its agencies in the ports to six, by ordering the return of National Agency for Food and Drug Administration and Control, NAFDAC, to the ports and moves by SON to be readmitted into the ports.

    They slammed the illegal seizure of legally exited consignments from the port by the SON.

    The operators explained that the government’s directive issued by the Nigerian Ports Authority (NPA) was a contravention of the presidential directive on the ease of doing business in the nation’s ports.

    Lead Partner/Consultant of Francis Omotosho and Associates expressed frustration with the government policy summersault, which he said was painting the country as unserious.

    Similarly, Association of Nigeria Licensed Customs Agents (ANLCA) National Publicity Secretary, Adumaza Sanni, said despite the exclusion of SON in the recent list released by the government, SON had continued to intercept properly-released and exited cargoes enroute final destinations and warehouses.

    But for DG Professor Moji  Adeyeye NAFDAC would not  have returned to the nation’s ports after seven years to check illicit drugs importation.

    Mrs Adeyeye said she took up the task in ensuring that officers of the agency were returned to the various ports to prevent illicit, fake drugs and similar products from coming into the country.

    She said the absence of her officers at the  ports was the main cause of having illicit drugs like tramadol and codeine coming into the country.

    “Returning NAFDAC to our ports is one of the struggles I fought when I assumed duty as the director-general in November 2017. We are back to the ports for the past two and half weeks; there was an abuse of such opportunity in the past. Our officers now have a change of attitude on the way they do things.Being at the ports to check and prevent entry of illicit drugs is one of our mandates taken away from us before we were reinstated recently at the ports.

    Lagos Chamber of Commerce & Industry President, Mr. Babatunde Ruwase campaigned for the capacity building of both SON and NAFDA and indeed other regulatory agencies. He noted that it is only when they are trained in the modern and competitive regulatory procedure that they will be more effective. He also criticised the turning of regulatory bodies into an income generating organisations noting that it not only lead to unhealthy competition but it derails them from what they are meant to be which s ensuring regulation.

    On why there is gap among the regulatory agencies, LCCI DG,  Mr. Muda Yusuf observed that there  are bad eggs in every organisation, and regulatory agencies are no exception.  He said: “You cannot rule out the possibilities that some of the bad eggs compromise, thereby aiding the importers of fake and substandard products. We should also recognise that all these agencies have capacit  and limitation problems also. They have shortfall of the required and necessary manpower, not trained adequately and the required knowledge is farfetched as the officials are seldom trained.’’

     

     

     

    According to him technological limitation is yet another challenge facing these agencies and that is part of the issues that contribute to failure of these agencies.

    Moreover, we have over 2000 porous borders in this country which has not been adequately manned, so most of these fake products find their way into this country through these places.

    The inability and unwillingness of law enforcement agencies to share information or conduct joint investigations significantly hinder the government’s efforts to combat counterfeiting.

    Head of Trade & Economics  and EU delegation to Nigeria and West Africa, Mr. Fillippo Amato told The Nation  in Lagos that EU have shown goodwill with the release of 12 million euro to support the enhancement of the National quality infrastructure, with a view to improving quality,  safety, integrity and marketability of Nigerian goods and services.

    He wondered how smaller African countries  such as Ghana, Rwanda,Gambia, Cameroun, Mauritania and the Southern African countries under SADEC have signed on as a result of improved quality of production as against Nigeria with her large population. On how Nigeria  can tap into the European market, Amato said it is only through improvement of her production processes . The country is already loosing so much by the rejection of beans and other product export into EU because of the presence of a pesticide known as dichlorvos which is harmful to health, he added.  He regretted that more than 70 per cent of beans exported to the EU from Nigeria contained a harmful pesticide.

    The EU boss stated that that EU is working with the relevant agencies of government such as  Federal Ministry of Industry, Trade and Investment, United Nations Industrial Development Organisation (UNIDO), Standards Organisation of Nigeria (SON), National Agency for Food, Drugs and Administration and Control (NAFDAC),  Nigerian Association of Chambers of Commerce, Industries, Mines and Agriculture (NACCIMA), Nigerian Export Promotion Council (NEPC) among others to ensure that relevant stakeholders are carried along.

    He advised that there is no short cut to standardization and added that Nigeria must do all within her means  to improve  on her products both for export and  internal  consumption.  He said the EU has 100 per cent immediate market opening for products from West Africa  and 75 per cent gradual market opening over a 20 year period for products from EU.

    Experts say for 50years Nigeria got away without proper standardization but now the nation cannot afford to live in isolation but must do the needful to meet international standards especially now that the country is looking towards diversification of the economy.  They also wondered at the lack luster  attitude of  regulatory agencies  such as Standard Organisation of Nigeria (SON) and NAFDAC who seem to be more interested on multiple charges  than implementing quality standards on products and services from the country.

    Consul General of Germany, Mr. Ingo Herbert said  his country exported  goods worth $1b last year while importing  goods worth $1.9b. He said his country is ready to do a lot more for Nigeria if only we Can improve  on our infrastructure, curb corruption and have a legal frame work that is predictable, reliable, trustworthy and a skilled work force. He said many German companies are ready to come back to Nigeria but only on assurance that the best business practice is the order of the day. He called for quality regulation to build confidence among trade partners.

     

  • ‘Multiple taxation still a challenge’

    multiple taxation is affecting  our members’ businesses, the Manufacturers Association of Nigeria (MAN) has said.

    Its Apapa branch Chairman, Olakunle Obadina, at an environment safety seminar organised by the branch, decried the multiple demands from regulatory agencies.

    According to Obadina, the negative impact of continued multiplicity of tax is becoming too burdensome.

    “Some of the areas of concern, particularly in Lagos, are the over 150  percent increment of the environmental development levy and petroleum storage permit payable to LASEPA, harassment of members by the state water regulatory commission and over-payment for water abstraction.

    Others on the tax headings of the state’s list of harmonised taxes and levies payable to local governments without recourse to the industry stakeholders are the radio and television charges which MAN described as ambiguous.

    Obadina, however, praised the administration for its efforts to resolve the infrastructure deficiency in the state.

    He implored the Federal Government to reengineer its policies and programmes towards rapid industrialisation to reduce the overdependence on imported goods.

     

  • Marketing summit holds today

    The Publisher of MARKETING EDGE magazine, Mr. John Ajayi has said this year’s National Marketing Summit and Awards holding today would address industry issues.

    He said it would ignite fresh conversation on contemporary marketing issues that have become very latent in terms of marketing management and the management of marketing business.

    According to him, this year’s theme, ‘Marketing paradigms in the age of digitalisation’ is so fundamentally germane to market challenges and all the tasks that confront marketing executives and CEOs.

    He said experts and corporate leaders would be present to provide the right compass in charting a very robust and highly enlightened direction for players in marketing services business.

    On the highlights of this year’s award, Ajayi said the event was planned to be  rich and educative in the sense that  there will be  morning session which will be dedicated to igniting contemporary conversation about what really troubles marketing and advertising business.

    He said: “You will agree with me that the topic cannot be more timely than now when consumers are battling with low purchasing power and, of course, the brand owners are currently facing very stiff opposition in terms of product patronage as a result of low consumer purchasing powers that has resulted advertently or inadvertently in unsold inventories”.

    Speaking on buyer’s apathy, he regretted that warehouses of most companies are full to the brim with some supermarkets well stocked, but the consumers are not coming.

    He said: “There is a resistance and, of course, there must be a way out of this marketing logjam. The consumers are at a crossroad because, they have unlimited demands but the ability to achieve demand is a challenge. So; we will be looking at the changes that are at the root of this kind of unpalatable marketing disequilibrium at this point in time when the world is already in the digital age”.

    He explained that some brand owners,  have gone beyond the conventional media in selling their products,  beyond the age of traditional media and further gone into the age of social media where innovativeness and aggression have been brought into pushing brand messages to ensure the right connection and  ensure a nexus between the products and the consumers.

    The forum he also said will  provide the platform for the rubbing of minds;  provide a platform for possible solutions that can enable  brand owners to have a meeting point with the consumers so that business can be more mutually rewarding both to the brand owners and to the consumers and, at the end of the day, it becomes a win-win game.

     

  • Twist in GE’s fortune as it exits Dow Jones

    The global energy conglomerate, General Electric (GE), is facing hard times. Its businesses are going down despite cuts to reduce costs and changes in management. Its recent exit from Dow Jones Industrial Average Index is another signal that all is not well with the American energy giant, reports Group Business Editor SIMEON EBULU.

    A myriad of challenges, including bad business deals, have edged General Electric (GE) out of the prestigious Dow Jones Industrial Average Index. The development has ended the conglomerate’s over a hundred year reign in a class of United States elite club of 30 companies. Its place has now been taken over by Walgreens, a pharmaceutical outfit.

    The dwindling fortune of GE is coming on the heels of a difficult period for the conglomerate whose shares have more than halved in the past year. GE has replaced its chief executive and has also announced series of cuts in an effort to reposition itself. GE’s exit from the club, David Blitzer of S&P Dow Jones Indices, the firm that runs the index said, would make the Dow a “better measure of the economy and the stock market,” adding that the change is also indicative of the growth of the healthcare sector.

    General Electric is losing its place on the Dow Jones Industrial Average after more than a century in a move that reflects its declining fortunes and a changing US economy. Adding to GE’s woes was the announcement from France, that the government would impose a fine on the conglomerate, if it failed to honour an agreement that it (GE) will create 1,000 net new jobs by the end of this year when it bought Alstom’s energy business in 2015. To date, GE has only been able to add only 323 jobs  as at April ending, France’s Finance Ministry said last week.

    Any hope that the agreement will be met was dashed by GE’s Chief Executive John Flannery, who informed French Finance Minister Bruno Le Maire  that the target was now “out of reach” because of difficult market conditions. Notwithstanding the hopelessness of the agreement being fulfilled, Le Maire urged GE to “take all necessary measures to comply to the best of its abilities” with the 2015 deal, under which GE will be fined 50,000 euros for each job not created.

    A spokesman for the French government, Benjamin Griveaux, pointed out that “sanctions must set an example, stressing that “50,000 euros should be applied by the end of the year if GE does not stick to its commitments. When you make commitments to the government, you respect them,” he added.

    The Dow Jones industrial average was created more than 120 years ago with 12 companies, all of which have fizzled out of existence, except GE which finally joined the fray on June 26.

    As recently as 2005 according to Reuters, General Electric was the most valuable publicly traded company in the US. The industrial conglomerate—originally assembled out of the various business interests of Thomas Edison in 1889 — was long without peer in the business world. However, in recent years, the company has been through a painful restructuring that has included the loss of its once highly profitable finance division. It also sold off its century-old railroad business, and its stock has fallen by half in the past year. For GE’s 300,000 employees and millions of shareholders, the consequences have been painful. More than $100 billion in market value has vanished from GE since November 2016

    GE’s ouster from the Dow and the likely sanction it faces from France, are only but a few of negatives staring the conglomerate in the face. Besides serious cash crisis caused by years of bad deals, it has shed thousands of jobs.

    To address some of its cash shortfall and debt overhang, GE unveiled a $3.25 billion deal to sell its distributed power business, which makes gas engines that are used to generate electricity in remote places, as well as manufacturing plants in the United States, Canada and Austria.

    These downsizing efforts and the sales spree, are measures  by GE to shrink itself and raise cash to pay down a mountain of debt.

    GE’s cash crisis has forced new CEO John Flannery to accelerate the dismantling of the company that once owned a leading appliance maker, a film studio and NBC. These sales and trimming moves, though have brought in some needed cash, they have also resulted in the sack of over 15,000 jobs.

    The ripple effects of GE’s misfortune, analysts fear, may not be limited to the US and other overseas countries alone. Some developing and emerging economies like Nigeria, may be negatively impacted and the reason is not far-fetched. In its expansionary spree, GE had spread its tentacles to Nigeria and had entered into agreements and established Memorandum of Understanding (MoU) to build turbines and electricity plants, as well as entered into some railway contracts with the Federal and some states’ governments. Ironically, these are part of the divisions the conglomerate has turned its back on and offloaded in its bid to raise funds to address its debt overhang.

    In Nigeria, there is uncertainty that GE might be hard pressed in delivering on its commitment to the government, given its waning stature, debt pile up and the unbundling and sale of some of its critical units, which have robbed the conglomerate of its robustness as an all-rounder in critical infrastructure provider. Part of the projects that may suffer the death knell is the realisation of the 10,000 megawatts of incremental power in Nigeria, in line with the power Memorandum of Understanding (MoU) signed with the federal government in March, 2012.

    The President and Chief Executive Officer of GE’s Grid Solutions/Energy Connections, Africa, Dr. Lazarus Angbazo, said in a press outing that GE was on track still to fulfilling its obligation to all parties.

    “What we signed in that power MoU, which originated from the company-to-country agreement, was that GE, working with the Federal Government of Nigeria, will invest in the development of new power generation capacity of up to 10,000MW of power – incremental power, which means that GE is going to work with investors, private sponsors of projects and if government also wants to invest in projects, GE will also look at those projects and co-invest. We have done that. If you look at our portfolio of projects in Nigeria, we have got several projects at several stages of development,” he said, adding that GE will continue to invest in Nigeria even at a time projects were cancelled globally because of the crash in oil prices.