The Nation Newspaper

Tag: GAP

  • Gap between rich, poor worries NLC

    The Nigeria Labour Congress (NLC) has expressed concern over the widening gap between rich and poor Nigerians in accessing healthcare and other services.

    NLC President Comrade Ayuba Wabba made this known at the 10th National Quadrennial Delegates Conference of the Medical and Health Workers Union of Nigeria (MHWUN) in Abuja.

    The theme of the conference was: “Advancing national campaign toward good governance, poverty alleviation, health for all for development.’’

    The labour leader said in other countries, the rich subsidised healthcare for the poor, saying that the reverse was the case in Nigeria.

    “The inequality gap in health care services between the rich and the poor in our country is getting expanded whereas in other countries it is the rich that subsidise cost of care for the poor but in our country it is the poor that subsidise for the rich.

    “The conference theme is very important and strategic because there cannot be development when majority of the people are so impoverished; we cannot talk about development if workers salaries cannot even take them to their next bus stop.

    “We cannot talk about development when our pensioners after working for 35 years have a living that is difficult. What is central is for our system to bring about equity and fairness in all ramifications,” Wabba said.

    He, however, identified the existing situation as the factor responsible for the nation’s poor health indices as well as underdevelopment, stressing that the component of the conference’s theme is key to development of any society.

    According to him, some of the health indices like maternal, child mortality, disease burden, general health services and government can only achieve the desired goals when the system is working.

    He blamed the failure of democracy on the privileged few who corner the resources to themselves.

    Wabba said: “We ought not to be where we are, if we are able to do what is right.”

    The NLC chief flayed the disparities in salaries and tax payment, saying there is no justification for the lowest paid workers to pay higher taxes than the elected public office holders.

    Wabba stressed the need for the continuous review of workers’ salaries like that of political office holders.

    “If you are increasing the salary of members of the political class, you can look at the same percentage to increase the salaries of other workers because we create and promote wealth of our nation.

    “So, if we create wealth for the nation, we must be compensated,” Wabba added.

  • How Morocco is closing Nigeria’s entrepreneurship skills gap

    Through various initiatives, Morocco is working with Nigeria to fund and train entrepreneurs desirous of launching successful start-ups. The North African country’s strategic partnership with Nigeria may have raised hopes of local entrepreneurs catching up with the rest of the world over the next decade. DANIEL ESSIET reports.

    TWO Nigerian companies, Vicfold Recyclers and Saint Michelles and Joey Limited, were among 12 African start-ups that won $100, 000 each in the recently-concluded African Entrepreneurship Award (AEA) sponsored by BMCE Bank of Africa, a leading Moroccan bank.

    Vicfold Recyclers is a Kwara-based incentive-inclined recycling social enterprise engaged in transforming waste to wealth through recycling and empowering unemployed women and youths. The firm was led by Folashade Amusa.

    Saint Michelles and Joey Limited manufactures jumbo rolls of recycled paper, which it sells to toilet paper and napkin firms. Sylvester Mujakperuo represented the company.

    The 12 winners were selected by a jury chaired by BMCE Bank of Africa president, Othman Benjelloun, in Casablanca.

    The award, with a yearly price of $1 million, was intended to reward projects with social and sustainable impact in the three programme areas namely, education, environment and uncharted fields.

    Morocco may have emerged a strong force in grooming African entrepreneurs and potential future industrialists. This year, Meltwater Entrepreneurial School of Technology (MEST) Entrepreneurs participated in a Hackathon held in Morocco last April.

    MEST companies, including Nigeria’s online subscription based payments solution, Amplify, were selected to participate in the hackathon after pitching to Royal Air Maroc representatives.

    The event ended with six teams being selected to move forward and work on their proposals with Royal Air Maroc, including MEST portfolio company, Amplify.

    To catch up with the fast-growing digital world, the government and private sector in Morocco are putting facilities in place to leap-frog young entrepreneurs into a new era of tech businesses.

    At the forefront of this is the OCP Group, Morocco’s largest integrated mining and agricultural concern. It is the world leading exporter of phosphate rock and phosphoric acid and Morocco’s single largest corporate employer.

    Ecole 1337 Centre in Khougibga is a thriving entrepreneurship academy in Morocco, also sponsored by OCP.  It is a start-up centre, which handles 150 participants after a competitive screening.

    They provide free accommodation and feeding in an arrangement that looks like a technology hub. Participants engage each other in conversations meant to help in solving problems.

    One of the administrators of 1337 Centre in Khougibga, Youssef Dahbt, said people are allowed to work as individuals and tackle challenges offered by the digital economy.

    He explained that there is a free environment to help youths innovate and develop applications and technological solutions.

    Also, Mohammed VI Polytechnic University located in the heart of the Green City of Benguerir in Morocco is partnering a few states in Nigeria. It is supported by OCP Foundation.

    The university’s Head of Mission, Khalid Baddou, said one of the goals of the institution was to partner Nigeria and other African countries to build new exciting start-ups around sustainable products.

    According to him, the marketplace is challenging, and many new ventures have difficulty developing technologies, this is where the institution comes in.

    Baddou explained that the institution was ready to train Nigerians to launch and commercialise their businesses, thereby improving local economies and strengthening ties to their communities.

    He explained that the institution was a key player in Morocco’s green city project designed to stimulate activities in clean tech industries.

    The green city project connects entrepreneurs and private industry with faculty, students, and state-level resources.

    The goal was to have positive impact across environment, economy, energy, entrepreneurship, and education.

    Baddou said the institution was dedicated to building and developing a healthy entrepreneurial system.

    He said the university was ready to work with Nigerian organisations to groom entrepreneurs and thinkers.

    He said the school, opened to undergraduates and graduate students, emerged as a place to further promote the human-centred approach to learning, problem-solving and innovation.

    According to Baddou, the school applies design thinking across fields, equipping students with the ability and mindset to tackle difficult global problems in industries from healthcare to energy.

    He hinted that the university was establishing a business incubator for students, with a passionate and overwhelming urge to start a business or launch a product or service.

    In addition to vocational training, the school offers aspiring entrepreneurs unparalleled access to intelligent peers and mentors, and a risk-free testing ground for their ideas.

    Students conduct extensive interviews and research on their products’ target audience, build prototypes and then test them.

    According to Baddou, the university wants to create a top breeding ground for young entrepreneurs, whose ventures can be collectively grown into a driver for the African economy.

    OCP Group Managing Director, El Ouafi Mustapha, said raising entrepreneurship awareness and providing access to training, support and other resources are critically important to the communities’ ability to nurturing entrepreneurial potential.

    He stressed that OCP, as part of its corporate social responsibility, supports nationwide efforts to promote skills development and entrepreneurship among young people.

    Mustapha added that through its network, dedicated to entrepreneurship, OCP aimed to improve the Moroccan economy and create new opportunities for sustainable development.

    In Morocco, the special entrepreneurship track offered by OCP skills training centres in Khouribga and Benguerir, enrolled more than 300 youths and provide coaching for many start-ups.

  • Bridging the gap in healthcare system

    Bridging the gap in healthcare system

    Nigeria medical industry has continued to suffer shortage of professionals.  Emigration of health personnel compounds the challenges as a sizeable number of physicians, nurses and other medical professionals are lured out of the country in search of lucrative jobs in developed countries because of our broken down healthcare system, inadequate infrastructure and poor compensation packages.

    For instance, statistics shows that in 2005, 2,395 Nigerian medical doctors practiced in the United States (US), and 1,529 in the United Kingdom.

    Similarly, most people living in Nigeria do not have access to good quality healthcare services.  Where it is available, it is too expensive for the average earner to afford.  Even at that, the rich and highly placed in government and private sectors do not have confidence in the available healthcare system.  Due to their discontentment with the poor quality of available medical facilities, they boost the medical tourism of United Kingdom, United States, Canada, India and South Africa instead of helping to grow the local medical care.

    These imbalances in our health system may have justified the establishment of Thompson & Grace Medical University (TGMU) and allied health services by Thompson & Grace Investment Limited (TGIL) in Uyo, the Akwa Ibom State capital.  At a health seminar the held at the Le Meridien Hotel, Uyo, President/Chief Executive Officer Dr. Isaac Thompson Amos said  “the justification for the establishment of the Medical University and its sister entities in the proposed Medical City is to promote and enhance medical education, clinical research and delivery of global standard healthcare in Nigeria, and indeed, Africa.”

    At the seminar themed: How Education, Health, and Medicine can be transformed to benefit Nigeria and Africa, which attracted mostly academia in medical institutions of learning in Nigeria, Dr. Amos disclosed that TGIL has signed a Memorandum of Understanding (MoU) with a German institution, University of Hamburg (UKE) at the office of the German Ambassador to Nigeria, Ambassador Bernhard Schlagheck in Abuja to enable his Group partner with UKE who would “consult in the design and operation” of the TGMU.  He said that the import of the seminar is primarily to sensitise the participants and various stakeholders, and get their buy-in into the Group’s dream of promoting medical tourism in Nigeria.

    Commenting on the partnership at the seminar, Prof. med Uwe Koch-Gromus, Dean of the Medical Faculty of the University of Hamburg (UKE), Germany, noted that “the UKE, Hamburg, Germany and TGIL, Nigeria, signed the MOU to enable both organizations to harness resources for the development of academic cooperation in international medical education in areas of mutual interest and expertise, adding that the “collaboration established will enhance the intellectual life and cultural development at both institutions, and will contribute to increased international cooperation.”

    Dr. Amos disclosed that the partnership would enable both parties to jointly “develop and provide structure, curriculum and practical program as well as administrative and management processes for the Medical University and Specialty Hospital.”  He said that these medical facilities are established to provide “training and support in capacity building in the areas of medical education, clinical research and healthcare delivery processes and procedures as well as healthcare management and administration.”

    He is optimistic that medical university will produce “increased number of highly trained and competent physicians, other healthcare professionals and facilities to meet the health needs of a rapidly changing Nigerian society.”

    Against this background, he called on all the governments and relevant governmental agencies to support the dream in the areas of provision of basic infrastructure such as roads, water, electricity, security, license issuances, permits, approvals and all other relevant facilities that are germane to actualize “our dreams and birth the nation of our collective medical and health dreams.”

    More significantly, the medical projects will help tackle the cavernous gap in the provision of state-of-the-art medical facilities and adequate healthcare for Nigerians.  It will be one step closer to achieving that dream to have world-class health facilities in Nigeria, thus reducing the need to travel abroad for medical treatment.  But the challenge lies on the readiness of the various stakeholders including the three-tiers of government to support this laudable project.

  • Bridging the $300b infrastructure gap with Islamic finance

    Bridging the $300b infrastructure gap with Islamic finance

    About $300 billion (N108.75 trillion) is required to close Nigeria’s infrastructure gap, according to experts. Without fixing infrastructure, Nigeria’s road to economic recovery will be long and tortuous, they claimed. The Federal Government has turned to the Islamic Development Bank  (IsDB). But, experts urge caution because of Nigeria’s secularity. Asst. Editor CHIKODI OKEREOCHA reports.

    When Finance Minister Mrs. Kemi Adeosun early this year opened the Abuja office of the Islamic Development Bank (IsDB), many knew that a closer collaboration between Nigeria and IsDB was afoot to enable the country exit recession through aggressive investment in infrastructure.

    IsDB is a Sharia compliant International Development Finance Institution (DFI) that participates in equity capital and grants loans for productive projects and enterprises. It also provides financial assistance to member-countries in other forms for economic and social development. The 43-year-old DFI has upgraded its Nigerian office to a regional hub.

    The bank’s plan was to coordinate operations in its West and Central African member-countries from the Abuja (Nigeria) gateway office, which will serve Nigeria, Gabon, Niger, Mozambique, Burkina Faso, the Republic of Cameroon, Uganda, Senegal, Djibouti and Guinea Bisaau, among others.

    The decentralisation of the bank’s operations through the opening of regional offices was aimed at bringing its services closer to member countries as well as enhance communication, improve efficiency and performance.

    Nigeria became a member of the IsDB, headquartered in Jeddah, Saudi Arabia, in 2005 under the administration of former President Olusegun Obasanjo. And on the strength of its membership, Adeosun had at the opening of the bank’s Abuja office sought its support in the implementation of the Economic Recovery and Growth Plan (ERGP) particularly in the area of infrastructure.

    Again, at IsDB’s recent 42nd annual meeting in Saudi Arabia, the Minister passionately repeated her plea, saying: “We want IsDB to be more visible and deliver signature infrastructure projects in Nigeria.” She specifically called on the bank to increase its financial and technical assistance to Nigeria to fast-track the achievement of the EGRP, which aimed at reviving the ailing economy.

    The EGRP, which covered a period of three years (2017 to 2020), was launched in Abuja by President Muhammadu Buhari. The medium term plan broadly targeted the restoration of growth, human development and a globally competitive economy, in an effort to combat recession and reposition the economy on the path of sustained growth.

    It specifically targeted to grow the economy by 2.19 per cent this year and subsequently, seven per cent in 2020. But with infrastructure critical to realising these ambitious targets, and government unable to raise significant cash to build infrastructure, it has turned to Islamic finance for succour

    However, the move, partly forced by Nigeria’s recent cash flow problems caused by crashing oil prices, may not have gone down well with some experts and financial analysts. Some of them, who spoke with The Nation, argued that Nigeria is not an Islamic country, but a multi-religious state that is constitutionally secular and so, should not turn to Islamic finance under the excuse of building infrastructure.

    They cautioned that Nigeria should be wary of hob-nobbing with IsDB and other Islamic banks as this is capable of undermining the nation’s constitution and its secularity. While insisting on the need to defend Nigeria’s secularity, some of them pointed out that there are other viable options and numerous non-religious lending institutions Nigeria can turn to for help.

    For instance, a Lagos-based lawyer/public affairs analyst, Barr Obiora Akabogu, said although, the only thing that can interest any responsible government in Islamic finance is its zero or low interest offer, there is the need for Nigeria to study the conditionalities very well before appending her signature for any facility from IsDB.

    He said studying the conditionalities before appending signature was necessary to avoid using the loan as an economic weapon to enslave Nigeria. “Nigeria must not come out of European colonialism and enter into Arab colonialism, because it is not a very good alternative, Akabogu warned, adding that there is one kind of attachment or the other that borders on religion.

    While recalling that when the economy of countries such as the United Kingdom (UK), Spain, and Greece were down, they never went to Islamic bank, Akabogu said “Nigeria should know better why those countries didn’t turn to Islamic bank for help.”

     

    Why Islamic finance is gaining traction

    According to the Managing Director/CEO, Islamic Banking and Finance Institute of Nigeria, Alhaji Sani Aminu Dutsinma, the Islamic finance industry is growing at 10 – 20 per cent annually, while “Shariah compliant financial” assets are currently estimated at $2 trillion, covering bank and non-bank financial institutions.

    Dutsinma, who made this known in Abuja, during a sensitisation workshop for journalists on the “Fundamentals of Islamic Economics, Banking and Finance” organised by the Institute in collaboration with the Nigeria Union of Journalists (NUJ), noted that Islamic banking assets have been growing faster than conventional bank assets.

    He said there has been increased interest in Islamic finance from countries like the United Kingdom (UK), Luxembourg, South Africa and Hong Kong. While pointing out that within sub-Saharan Africa, South Africa led the way in Islamic banking, he noted that Islamic finance was not reserved for Muslims only.

    According to Dutsinma, it is not a Muslim finance, with no such tag on Islamic finance products either in Nigeria or in any other part of the world. He, therefore, called on Nigerian policymakers to recognise Islamic finance as capable of significantly contributing to economic development, given its direct link to physical assets and real economy.

    The CEO was, however, quick to note that “Since the introduction of Islamic finance in Nigeria about 18 years ago, concerns and apprehensions have been voiced that the introduction might be a ploy to Islamise Nigeria. But as at today, we are yet to receive any report of religious discrimination as regards access to any Sharia compliant product.”

    As if sensing the concerns and apprehensions that may still greet Nigeria’s latest move to access Islamic finance, Adeosun noted that Nigeria had derived many benefits from its membership of the 43-year old IsDB.

    “We appreciate their intervention in the water supply, health and education sectors in a number of our states, but we want IsDB to do more,” the Minister, who was represented by the Permanent Secretary in the Ministry, Dr. Mahmoud Isa-Dutse, said. Isa-Dutse led the Nigerian delegation to the meeting of the bank.

    She said that given IsDB’s unique role as Islamic Bank with multiplicity of intervention instruments not available to traditional development banks, “We expect IsDB to be bold and work collaboratively with other Money Deposit Banks (MDBs) to ensure overall complementarity in all development interventions in Nigeria.”

    Already, IsDB President Dr. Bandar Mohammed Hajjar has assured that the bank would enhance the development impact of its projects and programmes through comprehensive development solutions that integrate services and products in its member-countries.

    Indeed, Islamic finance has grown progressively in the last 40 years, spreading to over 70 countries and becoming a $2 trillion market at the global level. Africa currently has only about two per cent of global Islamic banking assets and as little as 0.5 per cent of Sukuk outstanding.

    But with Nigeria throwing her hat into the ring, the stage appears set for the rapid growth of Islamic banking and ûnance across the continent, which is said to be home to over a quarter of the global Muslim population.

    According to experts, Nigeria’s economic managers may have been forced by the current economic downturn to realise that Islamic finance is being increasingly deployed as a strategic instrument to tap into the unbanked population in Africa and innovatively address the vital issue of financial inclusion.

    Besides, they have realised that it has become a catalyst for boosting Foreign Direct Investment (FDI) and trade vows between the continent and Organisation of Islamic Countries (OIC) markets. Furthermore, Sukuk is well positioned to play a powerful role in meeting the funding gaps in strategically vital infrastructure projects across the region.

    This must be why Dutsinma called on Nigerian policymakers to recognise Islamic finance as capable of significantly contributing to economic development, given its direct link to physical assets and real economy.

    He said: “The use of profit and loss sharing arrangement encourages the provision of financial support and generates jobs. The emphasis on tangible assets ensures that the industry supports only transactions that serve a real purpose thus discouraging financial speculation.”

    Dutsinma was of the opinion that Islamic finance helps promote financial sector development and broadens financial inclusion by expanding the range and reach of financial products, while helping to improve financial access and foster the inclusion of those deprived of financial services.

     

    $300b infrastructure deficit also a factor

    According to experts, Nigeria requires an investment of $300 billion to close her huge infrastructure gap and unlock the real sector’s potential to reflate the economy severely battered by crashing oil prices.

    The $300 billion infrastructure deficit represents 25 per cent of the nation’s Gross Domestic Product (GDP). This translates to an investment of about $25 billion annually, which Nigeria can hardly afford given the current cash crunch.

    Yet, the achievement of Nigeria’s numerous economic, developmental and inclusive growth goals articulated under the Federal Government’s ERGP was hinged on massive investments in infrastructure.

     

    Experts disagree, list other options

    Akabogu said rather than hub-nub with Islamic finance and make Nigeria an Islamic state under the guise of raising money to build infrastructure, the country should turn to other sources. “What is the use for Excess Crude Account (ECA)?” he asked, noting that external reserves is also there and has not been completely depleted.

    The public affairs analysts added that Nigeria could also fall back on the Sovereign Wealth Fund (SWF) to raise cash to build infrastructure. While noting that the country’s economic buffers are being funded, he said Value Added Tax (VAT) and money accruable from Customs and Excise are also viable sources.

    “Remember that Customs is the only organisation in Nigeria that continues to declare surplus all the time. There is money from the private sector. There is capital inflow into the country from foreign investors. Nigeria continues to be number one investment destination because as others are leaving, others are coming,” Akabogu told The Nation.

    Experts also say that Nigeria’s pension fund, which stood at N6.02 trillion as at last November, is another viable option to build infrastructure. With the National Pension Commission (PenCom) projecting that the nation’s total pension asset may hit N20 trillion by 2020, this huge pool of funds is seen by not a few analysts as a better choice than Islamic finance.

    Yet, others have recommended the Public-Private Partnership (PPP) model for designing, building, financing and operating new and infrastructure.

  • How to bridge housing gap, by don

    How to bridge housing gap, by don

    THE availability of affordable land will help in addressing the country’s housing shortfall and mitigate the proliferation of slums, a Professor of Urban and Regional Planning, Mohammed Asimiyu Junaid, has said.

    Delivering the 51st inaugural lecture of the Federal University of Technology, Minna (FUTMINNA) in Niger State, with the theme: Housing for the Nigerian poor: A reality or a mirage, he said the National Housing Policy needed to be reviewed for efficient implementation.

    Junaid added that the government’s political will was required to ensure allocations for estate development go to competent developers who can help in achieving the national policy for urban development.

    At the event, which held at Caverton Lecture Hall on Gidan Kwano campus of the school, the don said: “There should be well-developed mortgage institutions to assist developers to obtain loans at low interest rates. The government should also ensure even distribution of resources between rural and urban areas to discourage rural-urban migration and to decongest our cities. The need for functional building designs and very durable materials for mass urban housing provision cannot be overemphasised.”

    Junaid maintained that the government’s aim to provide mass housing for the poor was achievable, adding that feasible financial policies were needed to increase access to materials. He said the government should promote the use of eco-friendly construction materials and energy-efficient technologies.

    He said: “In some emerging economies, housing experts and policy analysts were hired to devise ways of overcoming housing challenges, knowing how significant housing is to a nation’s GDP. Countries, such as India, Mexico, Jamaica, Malaysia, Brazil and Thailan, are good studies for Nigeria to learn from.

    “These countries have deployed strategies and models ranging from Home Loans Guarantee, Mortgage Insurance, Liquidity Facilities, Pass-Through Mortgage Backed Securities, Tax Credit for Low Income Housing, Seed Capital, and Hedging of foreign long-term debts for private market operators. While not recommending a direct transfer of these models, a critical look at them in relation to our internal environment will help a great deal.”

    He advised the government to grant import duty wavers on foreign building materials and also offer tax relief to private developers interested in public-private partnership for delivery of low-income housing scheme to poor workers, noting that the PPP agreement would assist in the provision of basic amenities and social infrastructure in the towns and cities.

    According to the inaugural lecturer, the problems of housing shortage, urbanisation, overcrowding, unemployment, and other urban challenges can be solved if low–cost housing schemes are revived.

    In his remark, the Vice-Chancellor, Prof Musbau Akanji, hailed the “wonderful presentation” by  Junaid, describing the lecture’s topic as “apt and timely”.

    He said: “The lecture addresses the shortfall in mass housing scheme for poor Nigerians deserves an irrevocable commitment on the part of the government, estate developers and other stakeholders.”

  • Should pension funds be used to bridge housing gap?

    Should pension funds be used to bridge housing gap?

    As at last March, pension fund stood at N5.9 trillion, provoking calls for its investment in housing. About N59 trillion is required to bridge the 17 million housing gap. But, should the accumulated pension fund be so used? Stakeholders are divided over the issue, reports  MUYIWA LUCAS.

    Stakeholders in the housing and pension sectors are divided over the propriety of the deployment of the huge pension funds to close the housing gap in the country.

    The National Pension Commission (PenCom) Director-General, Mrs. Chinelo Anohu-Amazu, said the 2014 Pension Reform Act, as reviewed, provided opportunities for increased investment of pension funds in infrastructure and housing development. The act, according to him, also allowed for a percentage of contributing workers’ Retirement Savings Accounts (RSA) balance to be used as equity contribution for mortgage.

    Represented by Mr. Ibrahim Kangiwa, at a Mandatory Continuous Professional Development Programme of the Nigerian Institution of Estate Surveyors and Valuers, Lagos State Branch, the DG, however, noted that investment of the fund in housing was limited by the cumbersome nature of housing investment.

    Presenting a paper titled: An overview of the Pension Reform Act 2014 and the provision for investment outlets in real estate sector, Mrs Anohu-Amazu said as at last May, the total value of pension fund assets under the management of the licensed pension operators stood at N5.6 trillion.

    The DG explained that there was an effort by PenCom to increase pension investment in infrastructure and housing, and consequently urged stakeholders in pension administration to utilise the provisions of the Act for the provision of more infrastructure and real estate development in the country.

    She explained that the new Pension Reform Act (PRA 2014), has made provisions for states and local governments to embark on pension fund investments in the housing sub-sector, a sharp contrast from the 2004 Act, which only included the Federal Government service. Pension contribution rate has since increased from 7.5 per cent for the employers and 7.5 per cent for employees to 10 per cent employers and eight per cent employees respectively.

    Though she said the pension fund may not be used for real estate investment, Mrs Ahonu-Amazu expressed the readiness of PenCom to support mortgage financing as this will create more jobs, urging stakeholders in the real estate sector to device means of ensuring massive investments in housing provision, since the Act made provisions for increased investments in infrastructure and housing development.

    “Direct investment is currently not allowed due to liquidity and valuation issues. Traditionally, real estate is complex; when you need to get your fund out, real estate may not be easily disposable,” she said.

    The Association of Estate Agents in Nigeria Chairman, Mr. Chudi Ubosi, in his presentation, titled: ‘Investment of pension Fund and idle funds in housing development: The estate surveyor and valuer’s perspectives’’, argued that with about 17 million housing deficit, and the demand for housing put at 10:1 for demands and supply, about N59 trillion would be required to bridge the gap in housing. He said the sector contributes about 1.3 per cent to the nation’s Gross Domestic Product (GDP).

    Ubosi regretted that housing is still low,  saying that Lagos State, which has been described as the most vibrant property market in the country, still has home ownership at less than 20 per cent, and about 1, 500 net settlers daily in the state. He argued that all limiting laws and regulations preventing deployment of pension funds as well as direct investments in housing infrastructure be repealed without further delay.

    “Nigeria is one of the few countries in the world with no mortgage. Funds may just be in the banks; there is the need to create financial products and mortgage backed securities,” he said, adding that the investment in housing should also focus on the lower end of the housing pyramid, while regulations should be amended to allow the PFAs put money in the Fund to enable them invest in housing.

    However, the Managing Director, Stanbic IBTC Pension Managers Limited, Mr. Eric Fajemisin, disagreed with Ubosi, stressing that pension funds have not been idle.   The majority of the funds, according to him, are being used for infrastructural development in the country.

    Fajemisin, who spoke on: “Challenges and benefits for investment of pension fund in housing development in Nigeria and global approach, said one of the challenges in pension administration is that of about 180 million Nigerians, only a meagre seven million, representing four per cent, as at last March, are registered in the scheme.

    The Stanbic IBTC Pension managers chief stressed that if Nigerians participate in the mortgage sector, it could contribute between 30 and 70 per cent to the nations’ GDP, reduce poverty and improve standard of living in the country.

    He said the Federal Mortgage Bank (FMB) estimated that about N56 trillion would needed to meet the shortfall in Nigerian housing need, but the sources of housing finance are not adequately equipped to fund the supply deficits.

    “The housing sector is supported by favourable demographics, but fraught with a huge supply deficit and ineffective demand. It can play a special role in the economic dialogue in Nigeria as it generates employment, increases productivity, raises standard of living and alleviates poverty,” he said.

    NIESV, Lagos branch Chairman, Mr. Offiong Ukpong, said the pension fund, if well utilised, could solve the country’s housing needs and be a secured investment for the future. “If N20, 000 can buy a transistor radio for a worker now and instead of buying it, he decides to invest that money into pension fund, by the time he would be exiting the fund in 30 years, would that same money buy him the same appliance or furniture? Obviously not,’’ he argued.

    The chairman of the occasion and a former president of the institution, Mr. Yinka Sonaike, said housing has been a recurring decimal in the country and that efforts should be geared towards reducing its deficit.

  • How to bridge housing gap, by experts

    How to bridge housing gap, by experts

    Housing shortage is not limited to the middle class. It cuts across every stratum of the society,  the Executive Director, Grenadines Homes, Mr. Adesope Adeyinka, has said.

    In an interview, he said: “When we talk about housing deficit, people actually think it is limited to the lower class of the society. It will not be fair to look at the housing deficits challenge in Nigeria from one side. The deficits actually exist among all the market segments: the top, the middle and the lower classes.’’

    in partnership with stakeholders, Adeyinka said the deficit could be  managed. Besides, through the use of modern innovative technologies, some initiatives aimed at catering for the needs of each segment of the real estate market could be executed.

    For instance, he said its parent company- Palton Morgan Holding Company, Grenadines Homes and Propertymart, is working as subsidiaries, to provide for the different classes of the market. Propertymart caters for the middle and  the lower classes, by developing affordable property, for example, that civil servants and young executives can buy.

    On the other hand, Grenadines Homes, he said, was established to provide for the housing needs of the upper class whose projects are usually in exclusive areas.

    To boost housing units in the A and B luxury and upper segment, Grenadines Homes is undertaking a new housing project, called the “Atlantic Resort”, which on completion, will add 165 residential units to the upper end of the market.

    Adeyinka said it was conceived in response to the demand for mixed-use developments driven by the rise of the middle class and a thriving business environment in Lagos state.

    “The Atlantic Resort concept is basically around live, work and play in one, beautiful environment. We are looking at a model that will achieve self-sufficiency in terms of necessary facilities that will make the residents to be productive in their respective endeavours. There will be recreational, educational, shopping and tourism facilities, among others. In other words, you can control the world from the estate. It’s already attracting foreign direct investments. The phase one alone is going to cost $150 million. It’s a project we need at a time like this,” he said.

    The Marketing Manager, Grenadines Homes, Ms. Francisca Dyegh, explained that the Atlantic Resort concept as a well-thought-out project.

    He explained: “What other companies are doing is different from what we are doing; they are selling land to developers to develop, but what we are doing in Grenadines Homes is that we are directly responding to need of people within this vicinity. Atlantic Resort is about the only mixed used development that can give you the opportunity to live, work and play in one serene, beautiful environment.’’

    The Managing Director, Brash Brands, Dubai, Kiran Gill, said her company is coming into the project to tell the story of Atlantic Resort to Nigeria in a compelling way that will attract investors locally and internationally.

    “So, we understand what the ambition and the hopes are for Grenadines Homes, what they’re planning to do with the development.  And for us at Brash, we look at how we can tell that story. To tell that story in a compelling way to consumers and to investors who are looking to buy.

    Stakeholders believe that with a growing middle class and the need to cater for their housing needs, which is projected to hit 7.6 million by 2030, the prospects for this category in terms of investment potential.

  • How ITF is bridging manpower gap

    How ITF is bridging manpower gap

    Despite its challenges, the Industrial Training Fund (ITF) is striving to bridge the manpower gap through aggressive training. The agency has trained 237,561 persons from 5, 815 organisations in the last one year, reports TOBA AGBOOLA.

    For the nation to be out of its economic woes, constant training and retraining programmes are required for the youths to fit into new and existing jobs. One of the reasons for its economic woes, according to experts, is lack of training, which has created a huge gap in manpower. This, perhaps, was the reason for the establishment of the Industrial Training Fund (ITF) some 43 years ago.

    According to its Director-General (DG), Dr Juliet Chukkas-Onaeko, the agency has intensified efforts at closing the industrial gap. Since its inception, the ITF has fed the industry with able hands, thus sustaining the measured growth that has so far been recorded.

    The fund, under the current DG, has trained many youths on skills acquisition in the last one year. In the last year, the ITF has trained 237,561 Nigerians from 5, 815 organisations.

    Also, 704 special intervention programmes were implemented, out of which 202,560 trainees secured employment. Not done, about 16,211 Nigerian women benefitted from specialised intervention programmes of the ITF and 83, 050 students equally participated in the Students Industrial Work Experience Scheme.

    The agency has also helped in training 1000 youths each from the 36 states of the federation and the Federal Capital Territory (FCT). All these efforts were geared towards bridging the wide industrial gap in the country.

    In a chat with the DG, at the graduation ceremony of the inaugural set of automobile technicians trained by Truck Masters Nigeria Ltd,  under the ITF-NECA Technical Skills Development Project (TSDP), she claimed that her administration has upgraded the bandwidth of the Fund’s communication system to serve current resource requirements, just as the agency’s library was digitized and revenue and reimbursement portals established.

    The agency, she said, also entered into collaborations with Cement Technology Institute of Nigeria, for the training of 4000 artisans; Wavecrest College of Hospitality, for revamping MSN Culinary Department. Others are Nigeria Institute of Builders and Shell Petroleum Development Company.

    According to her, the agency also strengthened its collaboration with Nigerian’s Employers Consultative Association (NECA) and expanded the ITF/DVT (Germany Chamber of Crafts and Commerce) to train apprentices in line with Germany’s dual system. She noted that her administration last year graduated the first batch of MSTC Trainees, reviewed and secured approval for a new staff regulations and conditions of service.

    The ITF, Dr Chukkas-Onaeko said, is also engaging relevant stakeholders on training and effective implementation of its mandate, and sensitising Nigerians on the need to transit to non oil economy.

    Highlighting how the fund is initiating proactive measures to achieve its mandate, Onaeko said students under its training programmes are challenged to impart knowledge provided by the fund and take charge of leading the nation and the continent into an era of sustainable economic development.

    She said the vision of economic leadership on the continent by the country can only be achieved when adequate attention and commitment are shown by stakeholders in the quest to imbibe the nation’s youths with continuous vocational and technical knowledge that can create jobs and entrepreneurial opportunities for them and others.

    According to her, trainees sponsored by the Fund in collaboration with the Nigeria Employers Consultative Association (NECA) and other organisations would soon get international certifications.

    She said ITF is working on getting an international certification programme for its trainees to enable them work anywhere in the world. According to her, the Fund has also been working with various established players in various industries such as agriculture, oil and gas, and automobile maintenance in order to train more youths.

    The ITF’s continuous training through these collaborations, she said, is a move to support the government in reducing the rate of unemployment by placing technical education in the front burner. “I want to congratulate the graduating students, being the first set under the Automobile and Heavy Duty Maintenance and Technician Programme. With government’s automobile policy, I think this is the best time to take up such a task as taking up a skill in automobile industry, especially for heavy duty trucks, which are more complex,” she said.

    According to her, the initiative is a major move to support government’s efforts at reducing the rate of unemployment among the youths. “Most importantly, it has been helping the players in the various industries to raise new breeds of excellently skilled youths to work for them here instead of relying on expatriates,” she said, adding that, “the ITF has been working on certifications for our trainees so that they can work anywhere in the world, because our programmes seem not to be enough”. “The certification, when ready will have our trainees take exams to qualify them for a diploma in the field of their training,” she said.

    Dr Onaeko said this was necessary because it has been difficult to attract young people to technical skills because of the poor remuneration and recognition that the sector  has been suffering. ”We have, therefore, been training our students not only on skilled manpower, but alongside good work ethics, good customer care, and also entrepreneurial skills,” she said.

    NECA’s Director-General, Mr. Segun Oshinowo, said the purpose of the synergy is to reduce the rate of unemployment among youths by training them on how they can create jobs even with little capital at their disposal. “By being here, we hope to create jobs by getting the youths trained so that they can stand on their own,” he said, noting that there are huge potentials in the agricultural sector especially, in the area of aquaculture.

    The NECA boss appealed to the government to support the initiatives with funds as both organisations lack financial capacity to carry out their assignments.

    Managing Director, Truckmasters Ltd, Mr Tony Arenyeka, lauded the ITF-NECA collaboration for impacting the lives of the youths through technical skills acquisition. Arenyeka said Truckmasters Academy was training in areas of specialisation in electronics, mechanical panel beating and spraying, and workshop administration.

    The Project Manager, TSDP, Mrs Helen Jemerigbe, said the training was a baby of the project, which has been on for six years. She said the project had been working with 12 companies, and technical colleges all over the country, and the training with Truckmasters Nigeria Ltd was the result of the Memorandum of Understanding (MoU) signed in 2014.

  • Interbank, parallel market rates gap worsens

    Stakeholders in foreign exchange market have described the gap between the interbank foreign exchange and parallel market rates as worrisome.

    Currencies Analyst at Ecobank of Nigeria, Olakunle Ezun, said while the Central Bank of Nigeria’s (CBN)  administrative measures helped harmonised the foreign exchange market and stabilised the naira around a daily average of N198 after the initial adjustment, the gap between the inter-bank and bureau de change (parallel market) rates is worrisome.

    The greenback exchanges at over N220 to dollar at the parallel market, which is about N22 gap between both rates.

    He said overall, the CBN has reiterated its commitment to exchange rate stability but highlighted key upside risks to naira stability, including the weakening oil prices, impact of United States’ policy normalisation, the marginal level of oil savings which weighs negatively on market confidence, along with election-related spending pushing liquidity above target.

    The analyst said the Monetary Policy Committee (MPC) of the CBN met last month and decided to leave the Monetary Policy Rate (MPR) unchanged at 13 per  cent, highlighting risks to naira and inflation rate in short term.

    “We anticipated the decision to hold the MPR at 13 per cent to allow the monetary policy decisions of November 2014 and the effects of other administrative measures to be fully transmitted throughout the economy until the elections have taken place, before assessing whether further tightening is necessary. This is important as raising interest rates just before a national election would likely be avoided by any central bank,” he said.

    He said the MPC decision to hold policy steady was based on several competing domestic and external factors such as the overall weakening of the economy driven by low oil prices; effects arising from the normalisation of monetary policy in the U.S; currency substitution and partial dollarisation of the economy.

    Others are  the uncertainty over the growth outlook, which has moderated partly by the effect of low oil prices, naira depreciation and election concerns;  inflation rate and outlook which had risen steadily from eight per cent in December 2014 to 8.2 per cent in January and 8.4 per cent in February 2015.

    Head Markets, FBN Capital, Olubunmi Ashaolu, said the MPC’s unchanged stance was widely anticipated.

    “We are not aware of any such independent committee in the world announcing a change in direction in the week of an important election. The reputational risks for committees are too high. This does not mean that the MPC in Nigeria wanted to tighten and did not move under external pressure.

    “On the contrary, the committee wants to assess the impact of its previous measures, notably the rate rise and de facto devaluation in November as well as the CBN’s decision on 18 February to scrap the retail Dutch auction system (RDAS) of bi-weekly foreign exchange auctions,” he said.

     

     

     

  • TCN records 71.66Mw evacuation gap

    TCN records 71.66Mw evacuation gap

    • Claims 6,000Mw capacity 

    Of the 3,449.85Mega Watts  which the electricity generation companies produced as at September 28, the Transmission Company of Nigeria (TCN) sent out 3,378.19MW, according to the statistics published by the Federal Ministry of Power on its website.

    As to why the remaining 71.66MW could not be evacuated, the TCN General Manager, Public Affairs, Mrs. Seun Olagunju, said the gap was due to the fire outbreak at the Apo, Abuja transmission station,  adding that the station has been restored .

    She said the company has a “guaranteed 6,000MW capacity.”

    The spokesman was then asked to respond to the claim of the Chairman, Heirs Holdings Limited, Mr. Tony Elumelu, who had on September 10, said that in Nigeria, one of the biggest challenges to power generation is transmission.

    He was quoted in a statement by the Communications Manager, Marketing & Corporate Communications, Bolanle Omisore as saying that “in fact, while Ughelli Power Plant generated at full capacity for the first time in July, we’ve been asked to scale down generation because of the outdated transmission systems. For every 100MW generated and sent to transmission companies, 40 per cent is lost, in part because of this infrastructure issue.”

    But Olagunju explained that it is easier to blame government owned TCN, which is the only government owned entity in the power value chain, stating that in the history of the Nigeria power sector, it has never generated power beyond the company’s wheeling capacity 6,000MW.

    The spokesman debunked Elumelu’s statement and maintained “That is not true. But it is easier to blame TCN because it is the only government owned company in the sector. Nigeria has never generated up to 5,000MW and TCN has a guarantee capacity of 6,000MW. We can evacuate 6,000MW if they can generate it.”