The Nation Newspaper

Category: Business

  • Row in Senate over govt’s $7.4b loan plan

    Row in Senate over govt’s $7.4b loan plan

    The Senate was divided yesterday over plan by the Federal Government to borrow $7.435 billion for pipeline projects.

    The government seeks to obtain the loan from a consortium of banks comprising the World Bank, from which it is asking for $2.975 billion, African Development Bank, for $731.23 million, the Islamic Development Bank-$672.85 million,French Development Agency-$56.61 million and Exim Bank of China, for $3 billion.

    Through the motion to mandate the Senate Committee on Local and Foreign Debts to scrutinise the proposed loan, Senators insisted that additional details justifying the items for which the loan is sought must be provided before the proposal would receive its endorsement

    Senate Leader, Victor Ndoma-Egba who sponsored the motion entitled, ‘Inclusion of the Pipeline projects into the Medium Term (2012-2014) External Borrowing Plan,’ recalled that President Goodluck Jonathan, sent a communication seeking the consideration, approval and inclusion of the Pipeline Projects into the Medium Term (2012-2014) External Borrowing Plan dated 14th February, 2012.

    He explained that the projects are special initiatives designed to put the economy back on track through growth and employment activities geared towards transforming the fortunes of Nigerians by the implementation of the Government’s transformation agenda.

    He said the projects are at various stages of finalisation and a total external Pipeline borrowing.

    However, many Senators were not comfortable with the proposed loan.

    Senator Joshua Dariye in his contribution, recalled that the Minister of Finance, Mrs. Ngozi Okonjo-Iweala rescued the country from the London and Paris clubs under former President Olusegun Obasanjo, saying he is worried with the rate the country is borrowing money.

    He cautioned that if care was not taken, the country would land itself into a more serious mess on account of loan.

    Senator Ita Enang, said some of the items listed for the loan are unreasonable.

    Enang noted that most of the items for which the loan is sought are already covered in the 2013 budget.

    According to him, items like employment, roads, flood control and primary health care are already covered in the 2013 budget.

    He urged the Senate to ensure that the loan is obtained at competitve interest rate to avoid a situation where high interest rate would be used to repay the loan.

    He also wondered why no project was slated for Akwa Ibom in the Pipeline projects.

    Also, Senator Benadict Ayade opposed the loan in its entirety.

    Ayade wondered why the loan should be taken when there is nothing to show for loans obtained in the past.

    Besides, he said it is more likely that the loan would end up in the pockets of some fat cats in the country.

    He cited the example of his Cross River North constituency where a water project worth N500 million was said to have been awarded and paid for, stating that no project of that description was executed in his constituency.

    At that point, the Senate President, David Mark, promised to take up the issue.

    But Senator Ayogu Eze supported the loan, wondered however why no provision was made for the development of water ways.

    Eze said the roads would continue to be bad even when fixed if alternative means of transporting goods was not created.

    Mark said the issues raised by Senators would be addressed by the committee, adding that only names of states that applied for loan appeared in the document.

  • New Horizons now MicrosoftValued Partner

    New Horizons Nigeria, a franchise of New Horizons Worldwide, world’s largest independent IT training organisation with offices in 80 countries and six continents has emerged Microsoft 2012 Valued Partner, putting the organisation in the top five per cent of Microsoft’s ecosystem globally.

    A statement by the firm explains that Microsoft competency differentiates organisations such as New Horizons in the business world and enables the organisation to capitalise on market opportunity with tailored benefits such as eligibility for a direct relationship with Microsoft, customer technical sales and advisory services, and prioritized exposure on the Microsoft customer marketplace.

    The MD/CEO of New Horizons, Nigeria, Mr Tim Akano, said this partnership is an added advantage to New Horizons, which is a fast growing organisation with strong interest in the growth and development of the ICT and e-business aspect of Nigeria’s economy, as it will increase the nation’s opportunity to have more Microsoft Certified Professionals.

    Furthermore, he said New Horizons will continually use its unparalleled knowledge gathered in its 30 years of operations in 80 countries and six continents to ensure best IT and e-business trainings for Nigerians.

    Akano said, “With our robust relationships with Microsoft, EC-Council, Oracle, Cisco, Certiport, Certified Biometrics Professional (CBP), Linux and Systems Applications and Products in Data Processing (SAP) the future is bright for the Nigerian ITProfessionals.”

    The firm empowers about 50,000 Nigerians yearly in universities, schools, military, and corporate organisations.

  • Multiple charges inimical to business, says MAN

    The Manufacturers Association of Nigeria (MAN), Ogun State chapter, has said excessive charges are hindering its members’ businesses.

    According to MAN these as multiple taxes, levies and other charges by various tiers of government are excruciating.

    Speaking at its 27th Annual General Meeting, its Chairman, Dr Dapo Oguntuga, said the continuous introduction of taxes and levies by various organs of government, and the mode of their collection were not proper.

    “ Their actions pose great challenges to business planning, execution and projections. For instance, the state government recently revised Deed of Lease of Agreement from 10 to five years, while at the same time revising the land charges from N62,000 to N242,000 per annum,” Oguntuga said.

    Others are poor infrastructure, especially road network, water supply and electricity in industrial estates.

    He said the government should prevail on its officials to stop the molestation of company vehicles’ drivers conveying raw materials and finished products, most of which are unauthorised, as well as various organs of government personnel who visit factories at various times demanding similar payments and gratifications, saying all these are affecting manufacturers’ operation in the state.

    Oguntuga assured that manufacturers would continue to play their role in developing the state.

    His words: ”Manufactures will do everything possible to support the vision of the state government. Despite the harsh economic climate, manufacturing activities are on the increase with the branch recording appreciable growth in membership.

    “ Among the major factors that have stunted the growth of the manufacturing sector is the dearth of long-term funding for manufacturing industries”.

    The National President, Mr Kola Jamodu, said successive governments acknowledge the existence of the funding challenge facing the sector, especially the high cost of funds and consistently tried to address this challenge through various policy initiatives.

    He said the inadequacy of funds at the disposal of some financial institutions, dearth of basic infrastructure, harsh business environment, changes in the structure and economic fortunes of the nation, as well as policy inconsistency, have frustrated governments’ efforts at effectively meeting the funding needs of the manufacturing sector.

  • GOtv charts path to future digital technology

    Ahead of complete migration from analogue to digital broadcasting, GOtv, which premiered the second generation Digital Video Broadcast Technology (DVB-T2), when it launched its direct terrestrial television service last year, has restated its commitement to quality.

    With the launch of the technology came a bold announcement to deliver its service on the most up-to-date technology platform.

    The advertisement of that intent has left competitors (still dependent on the outdated DVB-T or T1 technology) playing catch up. Of GOtv’s decision to adopt the most modern technology, Chief Adewunmi Ogunsanya, chairman, Details Nigeria, promoters of GOtv, said: “We are very excited to about the launch of GOtv, a true testament of our vision to democratise the pay television landscape in the country and make digital television services a must-have for all Nigerians. This launch forms part of our broad-based strategy to contribute to Nigeria’s digital migration through sensible infrastructure investments and competitive service delivery.”

    Compared with its analogue cousin (T1 technology), DVB-T2 is a geological age ahead. For the end-user, digital television has potential for resolutions and sound fidelity comparable with blu-ray home video and with digital multiplexing. It also offers the possibility of sub-channels and distinct simulcast programming from the same broadcaster.

    For government and industry, digital television re-allocates the radio spectrum so that it can be auctioned off by the government. In the auctions, telecommunications companies can introduce new services and products in mobile telephony, wi-fi internet, and other nationwide telecommunications projects.

    In addition, digital broadcasting creates improvements in video and sound quality that gives room for high definition television. Moreover, the transmission and reception of broadcasting data expands to other different platforms, including mobile phone TV, Internet Broadcasting IPTV, DVB-h (Digital Video Broadcasting – camcorder).

    The superior technology of GOtv also offers a wider spectrum than T1 and is more efficient. At its best, T1 allows for an upload of about 20 channels on a platform. T2, on the other hand, yields about thrice that size. This is about 60 channels on its platform, given the same bandwidth. Another edge it has is that it experiences less interference than what obtains in T1

    GOtv’s launch came at a time the country is slowly kicking off its drive towards the International Telecommunication Union’s (ITU) goal of migrating TV broadcasting from an analogue to digital platform by the year 2015. Already, five cities–Lagos, Abuja, Port Harcourt, Kaduna and Kano– currently enjoy digital television transmission.

    Digital migration, according to the government, will spark domestic production of set-top boxes. Minister of Communications Technology, Mrs. Omobola Johnson, said the government is wooing foreign and local companies to invest in the production of digital TV set-top boxes, with the hope of producing 20 million set top boxes.

    “I don’t believe that we should repeat the same mistakes we made in the past. We are partnering with the Ministry of Trade and Investment to encourage and incentivise companies, both those established inside and outside Nigeria to take advantage of the coming digital migration because there will be a need for companies that manufacture set top boxes,” she said.

    But there a are fears that these arrangements may not meet deadline, as such are yet to kick off.

    Mr. Mayo Okunola, General Manager of GOtv Nigeria, explained that the GOtv platform was designed to make digital television available to all. “The GOtv brand was specially created to make available an affordable digital television services for all. When people think digital television, they immediately imagine it has to be expensive. This is not the case with GOtv, which offers great family entertainment at affordable prices,” Okunola explained.

    With less than N10, 000, a subscriber can acquire a GOtv decoder, install it by himself and enjoy premium content for as little as N8, 000 or N9, 500 for GOtv and GOtv Plus respectively. The package comes with a three-month free subscription. At the expiration of the initial three months, subscribers will have to renew their subscriptions, depending on their choice of bouquet, for N1, 000 and N1, 500 respectively.

    GOtv bouquet offers a rich menu of 25 channels, while GOtv Plus has all the 25 channels on GOtv plus additional seven channels, including CNN, Sony Entertainment TV (SET), SuperSport Blitz, NatGeo Wild, Disney Junior, MTV Base and the primary AfricaMagic channel–an aggergate of 32 top-tier channels.

    For fans African entertainment, GOtv offers five AfricaMagic channels. These are AfricaMagic, AfricaMagic Hausa, AfricaMagic Movies, AfricaMagic World and AfricaMagic Yoruba– channels through which Africans confront the distortions normally associated with viewing through non-African prisms.

  • Airtel indigenises brand as Nigerian heads firm

    With the appointment of Mr Segun Ogunsanya as the Chief Executive Officer (CEO) of Airtel Nigeria, doubts have been erased about the telecoms firm’s plans in Nigeria.

    A few months after the acquisition of the African assets of Kuwait’s telecoms giant, Zain, Airtel’s management comprisig the Chairman, Dr Oba Otudeko, outgoing CEO, Rajan Swaroop, CEO, Airtel International, Manoj Kohli spoke with reporters in Lagos on the firm’s integrity.

    An issue raised on the occasion bordered on the ‘reputation’ of Indian firms operating in the country. The reporters wanted to know if the Indians who were taking over the business were not going to lay off the workers and whether Nigerian professionals on the pay roll were not going to be subjugated to the whims and caprices of their less qualified Indians.

    Swaroop and Kohli took time to explain the mission in the country, rolling out a long list of what it hopes to achieve in the short, medium and long-term.

    All efforts to convince the reporters made little or no impact as they left the conference venue, in small groups, discussing in hushed tones what the telco’s future in the country.

    Analysts say it is against this backdrop that the appointment of a Nigerian to head the firm is significant.

    President, National Association of Telecoms Subscribers (NATCOMS), Deolu Ogunbanjo, says it is welcome considering the cynicsm that attended the take over of the telco from Zain, especially with the reputation of Indians in exploiting cheap labour anywhere they set up business.

    “The apointment is good news for the industry and it is also fulfilling the local content policy in the ICT sector in Nigeria. It is good news because the fear many Nigerians were having when Airtel was coming was that the Indians, once they come, cheap labour takes over. And look at the background of Mr Ogunsanya, coming from Coca Cola International and that is in no small way a great feat because Coca Cola is not a small company. It is a large multinational company with presence all over the world,” he told The Nation.

    Ogunbanjo said it is part of Airtel’s fulfilment of the local content policy in the ICT sector in the country. He commended the managemnt of Bharti Airtel for its consistency, adding that with the appointment of Ogunsanya, it is now clear that the firm believes that Nigerians could effectively managed businesses. He recalled that Zain also appointed the late Bayo Ligali as its CEO, saying: “Airtel has now come out to say boldly, ‘we are in Nigeria, we believe in Nigeria, and we believe in Nigerians managing Nigerian businesses.”

    For Lanre Ajayi, president, Association of Telecoms Companies of Nigeria (ATCON), the umbrella body of telecoms companies in Nigeria deriving strenghth in its sheer number, it is very healthy development for the industry. “I believe it’s a good development. It is a wise decision and it is in the best interest of the company because Ogunsanya is not only competent technically, but also understands the terrain. I want to believe that a Nigerian will understand Nigeria better than a foreigner and in this particular case, they have been able to identify a very competent hand who also happens to be a Nigerian,”he said.

    The NATCOMS chief believes the new CEO will take Airtel to the next level, increasing not only subscriber base but service quality. “Only recently, the firm moved to number four as the largest telecoms firm in the world and there is a thin line between number three and four. So, there is a very thin line. Ogunsanya will hopefully take Airtel, building its subscriber base in Nigeria to becoming number three in the world by 2013,” he said.

    The ATCON Chief is optimistic that the new CEO will deliver on the mandate handed over to him by the management. “I believe the company must have set milestons for him, so the expectation is for him to meet the goals set for him by his organisation at the end of the day. The telco is out there to compete with other companies providing the same services in the country, such competetion is good for the market. It is good for the consumers and we all stand to benefit from it,” Ajayi who is also former president, Nigeria Internet Group (NIG), said.

    A chartered accountant, Ogunsanya holds a Bachelors of Science in Electrical and Electronics Engineering from the University of Ife (now Obafemi Awolowo University, OAU, will be responsible for defining and delivering the business strategy and providing leadership for Airtel Nigeria and report to Kohli, CEO (International) and Joint MD, Bharti Airtel. The appointment takes effect from November 26, 2012.

    A statement from the telco said he takes over from Swaroop, who has successfully led operations at Airtel Nigeria in the past two years. Rajan will be appointed as non-executive director on the board of Airtel Nigeria following the completion of the transition and will continue to work closely with the Airtel Nigeria leadership team.

    Speaking of the appointment, Dr. Otudeko, chairman, Airtel Nigeria, said, “I am pleased at the appointment of Mr. Ogunsanya as the chief executive officer and look forward to working with him towards making Airtel the most loved brand in the daily lives of Nigerians. It is our resolve to continue building a robust pipeline of local talents in Nigeria as part of Bharti Airtel’s Africa Leadership Initiative. I have been impressed by the outstanding leadership qualities of Mr. Swaroop who has laid a solid foundation, during his tenure, for the long term growth of our business. I wish him success as he moves on in the Group.”

    For Kohli, Segun’s appointment underlines Bharti Airtel’s commitment to promoting African talent and building a world-class leadership team. “I am delighted to have Segun on board and am confident that his rich and diverse experience will add immense value to our operations in Nigeria.I wish him the very best in his new role and would also thank Rajan for his immense contribution to Airtel Nigeria,” Kohli was quotedvas saying.

    According to Airtel, Ogunsanya brings with him over 24 years of rich industry experience across multiple geographies, organisations and diverse sectors such as Coca Cola, Banking and Arthur Anderson. His last assignment was with The Coca-Cola Company, where he started his career in Finance and gradually transitioned into senior leadership roles with the various bottling operations of The Coca-Cola Company across diverse markets and countries in Africa. In his last stint, as the Managing Director and CEO of Nigerian Bottling Company, he was responsible for over $1billion revenue operations.

    The takeover of Zain by Airtel was adjudged by analysts as the largest telecoms takeover by an Indian firm. It cost a total of $10.7 billion. Reputed to be the brand that has undergone the highest number of corporate metamorphosis beginning with Econet Wireless, Celtel, Zain, and now Airtel, the firm has built a formidable empire in Africa where it operates in a total of 17 countries growing its subscriber base by 31 per cent or an additional five and half million customers to hit 20 million subscribers in August, this year.

  • ‘Global pricing, panacea for grey products imports’

    Japan’s global leaders in imaging, Nikkon, says global pricing is the panacea to unbridled importation of electronic products from the grey markets as it officially annouces its presence in Nigeria.

    Rohit Sawhney, the Area Manager, Nikkon, who spoke with TheNation in Lagos, said Nigeria is a huge market that cannot be ignored in Africa, adding that the firm has therefore decided to establish a firm footing in the country with a view to boosting its global market share and discouraging grey imports of its products into the country. He added that the official entry of the firm into the market also marked the availability of the one year warranty on its products.

    According to him, the menace of grey imports can only be tackled through global products pricing, adding that the opening up of Nigeria’ office marks the end of the road for grey imports.

    “As far as grey import is concerned, one thing that is important is global pricing. Our aim is to cut grey imports through global pricing so that our customers can get the one year warranty and value for their money.

    “Nikkon has an office in East Africa, set up at the beginning of this year. We are now opening regional offices. We have one in Kenya, we are opening another one in Nigeria so that customers can get the best value for their money and get the one year waaranty on our products.We are leaders in Europe, India, US and now in the UAE,” he told said.

    He disclosed further that Nikkon has an office in Dubai that takes care of the Middle East and Africa, arguing that the aim of the imaging firm is to be closer to the customer instead of sitting in Dubai and deciding how the Nigeran market is.

    “That is why we have set up an office in Opebi Road, Ikeja. The idea is to be close to the customers and serve them well. We have a service centre to take care of after sales services too,” he added.

  • ‘Using cooking gas can save N4.4tr’

    ‘Using cooking gas can save N4.4tr’

    A switch to cooking gas, according to experts will reduce the load on Power Holding Company of Nigeria ( PHCN), provide alternative source of energy and reduce gas flaring in the country, thereby saving the country over N4.4 trillion.

    The Managing Director, Nigerian Independent Petroleum Company (NIPCO), Mr Venkatararnan Venkatapathy, said in a statement that the switch will guarantee easier access to alternative cooking gas, create 15,000 new jobs, create 15,000 new access points for the purchase of LPG, in addition to 300 Oando filing stations.

    Other advantages include reduction in outbreaks of fire as a result of unattended kerosene stoves, reduction of deaths as a result of inhalation of coal, kerosene and firewood smoke, and reduction of maternal and child deaths.

    To the rural dwellers, the switch will create jobs and check rural – urban migration, development of the rural areas due to provision of infrastructure, development of human capital and associated skills set, creation of subsidiary industries to support LPG production and distribution in rural areas, as well as creation of new industries.

    The statement added that the President of Nigeria Liquefied Petroleum Gas Association, Auwalu Ilusays, observed that these are critical gains Nigeria can no longer afford to lose, adding that the nation has the capacity to produce four million tonnes of cooking gas annually if government supports the sector.

    He was quoted as saying “We are determined to explore this potential but government needs to promote the industry for us to make it a reality” he said recently in Abuja. Some of the challenges the sector is facing include issues around Value Added Tax, VAT, and high import duty on equipment. He also wants government to deal with the lack of regulations that promote LPG utilization in the country.”

    While stating that the country has a huge potential in the gas sector, the statement noted that Nigeria ranked among the world’s highest producers of natural gas Nigerian unfortunately ranks from the rear on the scale of national consumption of the product.

  • Fed Govt to sanction telcos over poor service

    Fed Govt to sanction telcos over poor service

    The Federal Government has issued an ultimatum to telecommunications service providers to improve their services or faced sanctions.

    Besides, the Nigerian Communications Commission has also concluded arrangement to check all promotions that are aimed at increasing subscribers’ base.

    The Minister of Communications Technology, Mrs. Omobola Johnson, said attempts by providers to increase subscribers base is responsible for the congestion in the networks.

    She said government is expected to come up with another detailed review of the quality of service indicator by December, stating that any operator that is found wanting would be appropriately sanctioned.

    She said: “In the coming days, NCC would curtail or stop all promotions that either increase subscribers base, the subscribers minutes, or that are causing additional congestion on the network.

    “ The second thing we are looking at, is if you recall, we fined the operators based on their not meeting the quality of service status, and we did work with them after the fines, and we agreed the term upon which they would upgrade their infrastructure and meet the new quality of service indicators.

    We also agreed that in December, we would do another detailed review of the quality of service indicator, and any network operator that is found wanting will be appropriately sanctioned by the regulator.

    “Today I had cause to brief Council on issues that affect over 100million Nigerians, and that is the issue of quality of service on our networks over an extended period of time.

    She listed the pace at which operators have been investing in expansion, modernisation and upgrade of their infrastructure , as someof the reasons for the poor service delivery.

  • ‘Transfer 50% of excess crude oil sale to SWF’

    The National Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) has advised the Federal Government to channel about 50 per cent of excess crude oil sale to the Sovereign Wealth Fund (SWF).

    The President of the association, Mr Herbert Ajayi, made the call in Lagos .

    He advocated that excess crude oil sales revenue be lodged in the Excess Crude Account (ECA). He welcomed the introduction of Medium Term Expenditure Framework-MTEF (2013-2015), Performance Agreement Contracts signed by President Jonathan with ministers as well as the gender empowerment as worthy innovations, which could be replicated by other tiers of governments and all their agencies with modification where necessary.

    “These innovations could bring both the public and private sectors together on the same page.

    “On gender empowerment, we counsel that the pilot programme should prioritise education and enlightenment, as well as access to entrepreneurship finance for women,” the association said.

    NACCIMA lamented that the cost of providing physical infrastructure has become prohibitive for the government to bear. He advised that concessioning or privatising the infrastructure was advisable.

    This, the association said, would replace the “do-it-alone syndrome” by the government, stressing that each tier of government should consider embracing Public-Private Partnership (PPP),which has been successfully done on some heavy projects.

    The chamber while commending the presentation of budget 2013, urged that the machinery at government’s disposal are used to ensure high level performance of the 2013 budget.

    The chamber noted that that despite the government’s zero-tolerance for bribery and corruption and the activities of the anti-corruption agencies, not much appears to have changed as indiscipline, bribery and corruption have continued to thrive.

    NACCIMA argued that the government needs to review and devise new strategies to tackle this dilemma, which it feared could affect the performance of the budget and service delivery in 2013.

  • Naira eases to three-week low against dollar

    Naira eases to three-week low against dollar

    The naira eased to its lowest in three weeks against the U.S. dollar on the interbank market yesterday as state-owned energy firm Nigerian National Petroleum Corporation (NNPC) sold dollars to the Central Bank of Nigeria (CBN), reducing market supply.

    The naira fell to N157.48 against the greenback on the interbank, its weakest since October 17, when it closed at N157.60. The currency closed N157.20 on Tuesday.

    Dealers said NNPC sold dollars to the CBN instead of selling to the market, raising forex demand as most banks had sold down their positions in anticipation of the dollar inflows.

    “There was a lot of demand in the market by banks covering their position after the NNPC sold its dollars to the apex bank,” one dealer said.

    The naira had been supported by large dollar flows from energy companies and offshore investors buying local debt, keeping it within the N157 to the dollar range.

    “As long as there is demand in the market and no significant dollar inflow, the naira should depreciate further in the coming days,” another dealer said.

    At an auction yesterday, the CBN sold $50 million at N155.74 to the dollar, the same amount and rate it sold at its last auction on Monday.