The Nation Newspaper

Category: Business

  • Fed Govt approves 10-year sugar master Plan

    Fed Govt approves 10-year sugar master Plan

    • To save $415.8m forex, generate 37, 378 jobs

    The Federal Government has approved a new sugar master plan for the country.

    The government noted that the 10-year master plan is expected to save the country $350 million annually from foreign exchange.

    Besides, the implementation of the plan government argued, will create 37,378 permanent jobs.

    Nigeria produces three per cent of local consumption while the rest is imported at the cost of over N100 billion.

    The Nigerian Sugar Master Plan (NSMP) was approved at the weekly Federal Executive Council (FEC), presided over by President Goodluck Jonathan.

    The Council also deliberated on the comprehensive report on Universities in Nigeria. Final decisions will however, be made after input from the governors.

    Briefing newsmen at the end of the meeting, Minister of Information, Labaran Maku and Minister of Trade and Investment, said the master plan was necessary in order to reverse the decline in sugar production in the country.

    Explaining the gains of the new plan, the ministers said it will create 107,000 direct jobs at the initial stage, derive annual production of 1.79 million tonnes of sugar; 161.2 million litres of ethanol; 400 mega watts of electricity; 1.6 million tonnes of animal feeds; 37,378 permanent jobs; $65.8 million savings in forex on fuel imports annually; and $350 million savings in forex on sugar imports annually.

    They also said that the new master plan spells out the sugar and ethanol projections required to achieve self-sufficiency and indicates the number of factories and sugarcane hectares, as well as number of skilled and unskilled staff required in order to reverse the decline in the sub-sector.

    Maku said, “The implementation of the NSMP as conceived would entail many projects, which would cover all geo-political zones of the country since suitable sites for cane production do exist across the ecological zones”.

    He said the implementation of the NSMP as conceived would entail many project which would cover all geo-political zones of the country since suitable sites for cane proxy tio exists across the ecological zones.

  • Marketers threaten strike over closure of Integrated Oil

    Marketers threaten strike over closure of Integrated Oil

    • Meet over subsidy

    Oil marketers under the umbrella of Jetties and Petroleum Tank Farm Owners of Nigeria (JEPTFON) has issued 24 hours ultimatum to the Nigerian Maritime Administration and Safety Agency (NIMASA) to reopen the sealed depots and head office of Integrated Oil and Gas Limited. They said association would close down its depots and retail outlets nationwide if the oil firm is not reopened.

    The NIMASA had on September 13 sealed off the depots and facilities of Integrated Oil and Gas Limited, picked and locked up some members of staff of the company and on September 14. It also sealed off the head office of the company picked up the Chairman, Captain Emmanuel Ihenacho over alleged stolen petroleum products to his depots. The business premises as at the time of filing this report were still under lock and key.

    The Executive Secretary of JEPTFON, Barr Enoch Kanawa during an interaction with reporters in Lagos said that the association after due investigation found that the action of NIMASA was done in bad taste. He said they wouldn’t watch the agency rubbish the hard earned enterprise of their member.

    The association questioned the authority of NIMASA to seal off all the business premises of the company, lock Ihenacho and members of his staff up, when the same NIMASA alongside other regulatory agencies including the Department of Petroleum Resources, Nigerian Ports Authority, Nigerian Navy and Customs cleared the alleged stolen fuel.

    He said there is more to the action of the agency that meets the eyes. He said that the Director-General of NIMASA should resign for lack of competence.

    He also noted that the various oil marketing groups including the Major Oil Marketers Association of Nigeria (MOMAN), Depot and Petroleum Products Marketers Association (DAPPMA), Independent Petroleum Marketers Association of Nigeria (IPMAN), and Jetties and Petroleum Tank Farms Owners of Nigeria (JEPTFON), will meet next week over non-payment of their outstanding subsidy debt.

  • Customers besiege Air Nigeria Abuja office for refunds

    Some customers yesterday besieged the office of Air Nigeria in Abuja to demand the refund of the money they spent in buying flight tickets they did not utilise.

    The development is as a result of the suspension of its operation by the Nigerian Civil Aviation Authority (NCAA) since June due to lack of maintenance.

    Consequently, the Chairman of the airline, Mr Jimoh Ibrahim, shut down the company for one year with effect from September 10, and sacked 550 members of staff, while retaining 50.

    According to News Agency of Nigeria, some of the customers said the management of the airline is yet to refund their money and that they were asked to contact the head office of the airline in Lagos.

    One of the affected customers, Olumuyiwa Okunade said he has been to the Abuja office on several occasions for the refund of his money.

    He said

    the few workers he met at the Nnamdi Azikiwe International Airport, Abuja, refused to pay attention to his complaints.

    Another customer, Chief Chinyere Anyamele, said a notice on the door directed complainants to Air Nigeria’s head office, adding that it would cost more money to get to Lagos.

    “Is the airline indirectly telling us to forfeit our money? It is not easy for someone who bought an air ticket in Abuja to travel down to Lagos for a refund.

    “The Consumer Protection Council (CPC) and the NCAA should do something about this,” she said.

    Mr Ambros Dickson said: “I am not a Nigerian, but I use the airline because of its name, thinking that it is better. But now, I can see that they are all the same,’’ he said.

    Pastor Sola Ogunmodimu, another customer, described the development as fraudulent.

    “It is a fraudulent act. Even before now, the airline was not treating passengers rightly. It is not customer’s fault that the airline failed in its operations.

    “After sacking the workers, they are also suposed to attend to the customers whom they have collected airfares from.

     

    “I am here again today to check if I will meet anybody. I have gone to their office at Transcorp, but they kept directing me to their head office,” Ogunmodimu said.

     

    NAN also recalls that the chairman of the airline also announced the suspension of its local, regional and international flights based on what he described as “disloyalty of its staff”.

     

    In a statement, the chairman said it was difficult to continue further investment in the carrier with the high level of staff disloyalty and weak business environment.

     

    Ibrahim, in the statement, said 50 loyal members of staff had been selected with a mandate to recommence business within 12 months.

     

  • Naira firms after CBN’s rate decision

    The naira firmedslightly against the U.S. dollar yesterday, a day after the Central Bank of Nigeria left interest rates on hold and said it would keep monetary conditions tight, dealers said.

    The CBN kept rates on hold for the sixth time in a row at 12 per cent on Tuesday, welcoming improved growth and a slight fall in headline inflation. But it said monetary measures will remain hawkish for the foreseeable future.

    Financial markets in Africa’s second biggest economy were closed when the rate decision was made on Tuesday.

    The naira according to Reuters opened for trade at N157.50 to the U.S. dollar on yesterday, higher than Tuesday’s close of N157.75.

    Dealers said the naira was partly driven by inflows from foreign investors buying bonds at an auction on Wednesday and oil companies selling the greenback to lenders.

    “Chevron sold around $113 million to some lenders, while the Nigerian Liquefied Natural Gas sold an undisclosed amount. There were also inflows from investors buying bonds,” one dealer told Reuters.

    Nigeria plans to sell 60 billion naira in bonds on Wednesday with maturities of five and seven years.

    The central bank said $1.4 billion of foreign investment flowed into debt in August.

    Olayemi Agbe-Davies, a bond dealer at Standard Chartered Bank, told Reuters debt markets had anticipated the hold decision on rates and already factored it into bond pricing, so yields were largely steady yesterday.

  • Subscribers decry poor telecoms service

    Mobile telephone subscribers in the Federal Capital Territory, Abuja, yesterday decried what they described as poor quality of service, saying it has affected their businesses in terms of passing urgent information either through calls or short message service (SMS)

    They said the decline in service delivery has been on the increase in recent times without any improvement from the service providers.

    Yakubu Thompson, a businessman, said most times his calls did not get connected and his messages always stayed pending for a long time before they could be delivered, adding that when the call eventually got through, it kept braking, making it difficult to communicate.

    “Sometime in the process of sending urgent information, the line will remain disconnected or will say, switched off, even when the persons’ phone is on.

    “Last week, I tried to call my staff to go and give our client a document that will fetch us a huge contract as the phone kept showing call disconnected. You could imagine how frustrating the service problem could be and I lost the contract, ‘‘ Thompson said.

    Another subscriber, Hajia Nma Muhammad, a civil servant, said for four days there was no network in her house at Prince and Princess’ Estate.

    She said it took her to use a friend’s phone to lodge a complaint before the service was restored.

    “Now the service comes off and on, what can I say, bad system,’’ Muhammad said.

    Mr Garba Ibrahim, a cloth seller at Wuse market, said that he tried calling his wife with two different networks to pick his children from school because he was busy with consumers at the shop.

    Ibrahim said for more than an hour the phone kept telling him switch off, he got angry and rushed to the school and picked his children only to get home to find that his wifes’ phone was on.

    “You can imagine that, these service providers will not break my home. NCC must do something to ensure that service improved in this country,’’ Ibrahim said.

    A journalist also told News Agency of Nigeria (NAN) that some time he experienced loss of service in his house at Abacha road Mararaba.

    “Some of us are tied to the network not because we love it but because most of us receive our salary alert from these networks.”

  • Fed Govt inaugurates committee on sea ports

    The Federal Governmenthas inaugurated a seven-man committee on Ibaka and Badagry sea ports.

    The Committee, chaired by a Director in the Department of Transport Planning and Coordination, Federal Ministry of Transportation, Dr. Iorwuese Viashima, is to ensure the successful construction and completion of the new sea ports, before 2015.

    Speaking at the inauguration in Abuja, the Minister of Transport, Sen. Idris Umar said construction of the Ibaka Deep Sea Port in Akwa Ibom and Badagary port became necessary to decongest the Lagos sea ports.

  • Nestle Nigeria hits N604 per share

    Nestle Nigeria hits N604 per share

    Nestle Nigeria Plc yesterday set another historic stock market and personal record as it rose by nearly the maximum allowable daily price change to hit a new high of N604 per share.

    The company showed a stronger-than-average momentum with a gain of N26.50 per share, representing about 4.6 per cent increase out of the maximum five per cent price change band.

    The benchmark index for the market, the All Share Index (ASI), recorded a modest increase of 0.32 per cent to close at 25,456.01 points as against its opening index of 25,373.83 points. Aggregate market capitalisation of all equities also gained N27 billion to close at N8.104 trillion compared with its opening value of N8.077 trillion.

    With the soft nudge yesterday, average year-to-date return at the Nigerian stock market rose to 22.79 per cent.

    The new high further cemented Nestle Nigeria’s historic performance as the highest-priced, most resilient and stable stock at the market. The food and beverages stock has consistently delivered positive full-year returns over the years, even in the throes of the recession.

    As the recession shook the market in 2009, Nestle Nigeria more than doubled its share price from a low of N104.50 to a high of N247.72 and eventually closed at N239.50. The closing price for 2009 became the lowest price for 2010 as the company’s share price rose to a high of N401 and eventually closed the year at N368.

    In 2011, as the market stumbled with a negative year-to-date return of 19.5 per cent, Nestle Nigeria posted a positive return of 20.92 per cent, setting a new high of N470 per share. The company’s share price closed at N445.66.

    Besides setting new highs, Nestle Nigeria has also continuously set a higher low, indicating strong resilience that reassures on the share price. Lowest market value per share rose from N104.50 in 2009 to N239.50 and N367.83 in 2010 and 2011 respectively. It has maintained a down limit of N400 so far this year.

    Meanwhile, Lafarge Wapco Cement Nigeria recorded the second highest gain yesterday with addition of N2.60 to close at N52.60.

    International Breweries placed third with a gain of N1.42 to close at N15.70. UAC of Nigeria rallied 50 kobo to close at N41. Union Bank of Nigeria gathered 37 kobo to close at N7.90. PZ Cussons Nigeria gained 29 kobo to close at N24.45 while National Salt Company of Nigeria added 27 kobo to close at N5.74.

    However, Nigerian Breweries led the slackers with a loss of N2.50 to close at N135. Julius Berger Nigeria lost 51 kobo to close at N27.50. Presco dropped by 28 kobo to N15. Zenith Bank lost 23 kobo to close at N16.09 while Ecobank Transnational Incorporated dropped by 20 kobo to close at N11.21 per share.

    Total turnover stood at 517.96 million shares valued at N3.07 billion in 5,172 deals.

  • RenCap forecasts drop in Nigeria’s growth

    RenCap forecasts drop in Nigeria’s growth

    Nigeria’s economy is expected to grow at a slower rate of 6.3 per cent in 2012, compared with 7.4 per cent year-on-year in 2011, Renaissance Capital (RenCap), an investment and finance firm has forecast.

    According to the firm, slower growth is positive for inflation, but it argued that there was no need for rate reduction yet.

    In an emailed report, tagged: ‘Nigeria: 2012 GDP growth – Soft growth, moderating inflation, but no cuts yet,’ RenCap said pressure on the consumer is evident from the significant slowdown of the wholesale and retail sector in the first half of 2012.

    This, it said, remained a fair indicator of consumer demand and would lead to a decline in demand-driven inflationary pressures, this year.

    The investment firm, said the slowdown in consumer demand was countered by increased cost pressures, partly due to the partial removal of the petrol subsidy, and to a lesser extent, the June electricity tariff hikes.

    “Aside from the July increase in import tariffs on grains, which has increased the input costs of some agro-processers, we expect cost pressures to soften in the second half of 2012. We think the strengthening of the naira over the past two months to N157.60, from N160.75 at end of July, will soften input costs, which is positive for inflation,” it said.

    Last month’s slowdown in inflation to 11.7 per cent, from 12.8 per cent year-on-year, it said, partly reflected the decline in cost pressures.

    The firm, said it was too early for Nigeria’s monetary Policy Committee (MPC) to cut the monetary policy rate, partly because core inflation remains high at 14.7 per cent.

    “We believe cutting rates now may undermine the recovery and stability of the naira, on the back of improved forex reserves. Moreover, recent comments from the CBN suggest that it believes monetary policy needs to remain tight, despite the recent respite on inflation, owing to accommodative fiscal policy and structural constraints,” it said.

    RenCap said the slowdown in the rate of the oil and gas sector’s decline reflects an increase in oil production to an average of 2.38 million barrels per day (mb/d) in second quarter of 2012, from 2.32 mb/d in first quarter of 2012, according to data provided by Nigerian National Petroleum Corporation to the National Bureau of Statistics (NBS).

    The slowdown in the rate of the oil and gas sector’s decline, it said, was timely, as such development, helped counter the softening of the non-oil sector’s growth to 7.5 per cent in second quarter, from 7.9 per cent in the previous quarter.

    “As the oil and gas sector continues to be undermined by oil theft, in particular, we expect the sector’s performance to remain subpar in second quarter of 2012,” it said.

    The firm explained that softer agriculture growth resulted in slowdown in non-oil sector growth, adding that with Nigeria’s agriculture sector producing 40 per cent of the Gross Domestic Product (GDP), the sector’s performance has a material impact on economic growth.

     

     

    explained the non-oil sector’s growth slowdown during the period.

    “The lean harvest season, typically in second quarter, partly explains the agriculture growth softening. This was exacerbated by an increase in insecurity, which has undermined agricultural activities, as well as flooding in some parts of the country that displaced people and damaged farmland. We expect agriculture sector growth to strengthen in fourth quarter, on the upcoming main harvest,” it said.

    It said that the building and construction sector, has been growing at double-digit rates for more than three years, and is one non-oil sector that did not experience a growth slowdown in first half of 2012, compared to a year earlier.

    “We believe this strong growth reflects robust fixed investment. Building and construction’s solid growth is mirrored in the sector that supplies a significant building material, cement. The cement sector’s growth strengthened to 11.7 per cent first quarter, from 10.4 per cent in first quarter and 10.6 per cent a year earlier,” it said. Manufacturing, it said, picked up in second quarter, owing to improved power supply. The manufacturing sector’s growth strengthened to 7.3 per cent in second quarter, from 4.2 per cent in first quarter.

  • Govt urges support for non-interest banking

    Govt urges support for non-interest banking

    The Federal Government is committed to making sure that the non-interest banking system takes strong root in the country as well as provide Nigerians with good alternatives.

    Minister of State for Finance, Dr Yerima Lawan Ngama, who spoke yesterday in Abuja at a seminar on ‘Developing Islamic Financial Institutions in Nigeria,’ organised by Mutual Benefits Assurance plc, denied insinuations that non-interest banking was a religious system.

    He urged Nigerians to take advantage of the non-interest financial system, adding that the benefits of the Islamic financing system helps to bridge the gap between the rich and the poor.

    He said: “In Islamic banking system, there is compassion and transparency in the process, just as secrecy is not allowed from any of the parties,” adding that in the Islamic financing system, everybody is his brother’s keepers.

    He noted that some of the unethical practices that endangers people’s monies in conventional banks are not present in Islamic banking system.

    He however lamented the dearth of knowledge on the Islamic banking concept, urging stakeholders to do more in the area of capacity building and publicity.

    Speaking earlier, the Managing Director of Jaiz Bank, Mohammed Mustapha Bintube, said, Nigeria was ripe for an alternative source of banking, considering the fact that the global credit crunch didn’t affect Islamic banks, while it affected the conventional banks seriously.

    He said his group intended to make Nigeria the financial hub of Africa, adding that the country has no reason to be the second largest business destination in Africa behind South Africa.

  • ICAN faults govt on budget implementation

    ICAN faults govt on budget implementation

    The Institute of Chartered Accountants of Nigeria (ICAN) yesterday criticised Federal Government on its budget implementation, saying the citizenry are yet to feel the positive impact of the budget despite huge funds that have been released.

    Speaking at the ICAN symposium in Abuja, the President, Adedoyin Owolabi, said the non-implementation has culminated in high rate of poverty and unemployment in the country.

    He said there has been a mismatch in the brilliant proposals of the budget and its achievement in terms of reduction in unemployment, poverty, inflation, and infrastructure deficit.

    The ICAN symposium with the theme, ‘Budgets of the Federal Government of Nigeria,’ took a retrospective look at the 2009, 2010 and 2011 budgets.

    The review was geared towards assessing the impact of the budget on the economy and how governance and management of some key macroeconomic indicators have affected the successful implementation of the budgets.

    Owolabi, said, “As a stakeholder in the economy, the institute is deeply concerned about the nation’s paradox of poverty in the midst of wealth.

    “The nation is richly endowed with human and natural resources, and therefore has no reason to be a poor sprinter in the economic development race, urging that the bright ideas contained in the budgets should be translated into reality.

    Owolabi further picked holes in the huge budget deficit which had been mainly financed through borrowings adding that its utilisation had not addressed infrastructure deficit.

     

    He said “The huge absolute value of budget deficit financed mainly with borrowings from the banking system has continued to negatively impact cost of funds in the economy. Capacity utilisation in the real sector has not improved phenomenally.