The Nation Newspaper

Tag: investments

  • Afrinvest boosts clients’ investments with AfriTrack

    Afrinvest Securities Limited (ASL) has launched AfriTrack,  a unique service designed to unlock the value of outstanding and unclaimed entitlements of investments in Nigerian quoted securities, equities and bonds.

    Targeted at High Networth Individuals (HNIs) and corporates, cooperative societies, estate account clients and busy executives, AfriTrack is a combination of ancillary services bundled into a single service, for ease and convenience.

    “It involves reconciliation of client’s shareholding and investments; recovery of all outstanding certificates, bonuses and dividend warrants; recovery of return moneys on unallotted public offer shares; dematerialization of recovered share certificates; revalidation of expired dividend warrants; and consolidation of multiple shareholding accounts and CSCS accounts in multiple houses,” said Charles Egbunonwo, Managing Director of ASL.

    On how to avail AfriTrack services, Egbunonwo said, “simply open a brokerage account with Afrinvest Securities Limited, fill out the AfriTrack application form, supply basic information on your investment portfolio and provide us with a mandate or authorization letter. We would then leverage on our cordial relationship with various company registrars to promptly reconcile actual shareholding against benefits and entitlements received.”

    “AfriTrack services would normally be concluded within a period of one to three months depending on the complexity of the portfolio and peculiar circumstances”, Egbunonwo noted.

    Afrinvest Securities Limited is a broker dealer and dealing member of the Nigerian Stock Exchange.  It is a fully-owned subsidiary of Afrinvest (West Africa) Limited, a wealth advisory firm involved in investment banking, securities trading, asset management and investment research with a focus on West Africa.

  • Polls and investments

    Polls and investments

    In the build-up to the general elections, political parties had created so much tension that even the ordinary Nigerian was apprehensive about what could happen before, during and after the polls. The reasons for the general apprehension were the hate campaigns and killings of supporters of one political party or the other.

    During the electioneering campaign, and especially the six weeks preceding the elections, domestic investments in the Nigerian Stock Exchange (NSE) recorded a substantial decline, owing to fears about insecurity and uncertainties regarding the elections. For instance, the latest investment details from the NSE showed that local investments dropped by N40.1bn at the end of February 2015, although as of January 2015, the total investments by domestic investors stood at N90.61bn while a document obtained from the NSE indicated that this later dropped by 44 percent to N50.24bn by the end of February.

    On the other hand, foreign investments rose in this period; as a total of N133.95bn or 35 percent was attributed to foreign investors, representing an increase of N34.8bn compared to N99.11bn invested at the end of February. In summary, the NSE document reported: “Domestic investors conceded about 45.22 percent of trading to foreign investors as domestic transactions decreased from 47.76 percent to 27.39 percent, while FBI transaction increased from 52.24 percent to 72.61 percent over the same period”.

    Some capital market experts have attributed the consistent reduction in local investments partly to “fears of the general election, the increasing security concerns and the tight monetary policies of the Central Bank of Nigeria”. In addition, Mr. Johnson Chukwu, the Managing Director and Chief Executive Officer of Cowry Asset Management Ltd, gave some factors leading to the decline in local investments as external and internal, pointing out that the trend is likely to continue until the second quarter of 2015. According to him, “the factors driving the bear run seem to be declining oil prices; depleting reserves; termination of quantitative easing; likely further tightening of monetary liquidity by the Central Bank and a possible two-horse unpredictable presidential election in February 2015”.

    We wonder why elections should have this much adverse effect on investment, foreign or domestic. Much as we agree that certain events could make calculations to change in countries at given periods, election, particularly electoral violence, should not be one of them. Elections should be a routine event without the restriction of movement that has a bad effect on the economy, as it prevents traders and even financial institutions from carrying out their businesses. The militarisation of the society at election periods also contributes to loss of transactions from legitimate businesses on election days.

    Then, the kind of hate campaigns experienced at this year’s elections are  more than enough to have negative impact on the society. It is obvious, therefore, that under the climate of uncertainties that exist during elections in Nigeria, no investor would like to invest where he cannot guarantee profitable returns on his investment as a result of insecurity or policy inconsistencies of the government. It is, therefore, extremely important that our politicians are made to realise the implications of their behaviours and utterances at electioneering campaigns so that badly needed investors are not discouraged from coming to invest in the country. The political leadership should not allow their supporters to turn election into a theatre of war or a do-or-die affair.

    Although attempts have been made to curtail violence at elections by making the political parties sign peace accords, the accords have not worked because violent acts at elections have become a tradition in the country. We must put a stop to this if we want investors to come to the country. And one way to achieve this aim is to punish people who perpetrate electoral violence.

     

  • Delayed PIB passage derails foreign investments 

    Delayed PIB passage derails foreign investments 

    The Rivers State Chairman of Trade Union Congress of Nigeria (TUC), Comrade Chika Onuegbu has warned government and politicians to stop politicising the passage of the Petroleum Industry Bill (PIB) into law. To him, the delay in its passage has derailed foreign investment in the sector  that accounts for over 90 per cent of the nation’s foreign exchange earnings.

    Onuegbu, who spoke at a media briefing in Lagos, noted that investors have continued to adopt  wait-and-see attitude, refraining from making any new investment pending the passage of the bill into law.

    He said: “The non-passage of the PIB into law has derailed foreign investment in 2014 in the sector that accounts for over 90 per cent of the nation’s foreign exchange earnings.

    “The irony of the delayed exercise was when President Goodluck Jonathan administration was advised to re-start the whole process over again when the administration in January 2012 set up the  Special PIB Task Force led by Senator Udo Udoma to work with relevant government bodies to produce a new version of the PIB for presentation to the National Assembly.”

    According to Onuegbu, the dangers in the current dispensation is that Nigeria, therefore, cannot afford the luxury of time, while politicians indulge in unnecessary bickering over such an important bill in a sector that is the main stay of the economy accounting for over 90 per cent of foreign exchange earnings, about 40 per cent of the Gross Domestic Products (GDP) and 80 per cent of government revenue.

    The labour leader, who noted that the PIB represents a great opportunity for Nigeria to ensure a solid foundation for the future of oil and gas operations in the country, added that the petroleum resource, which Nigeria is endowed, should work for and benefit Nigerians and not a few individuals.

  • ‘Non-passage of PIB delaying investments in oil, gas sector’

    There has not been any major investment in the oil and gas sector in the last four years, due to the non-passage of the Petroleum Industry Bill (PIB) by the National Assembly, the Managing Director and Chief Executive Officer, Frontier Oil Limited, Dada Thomas, has said.

    He said Nigerians should hold the lawmakers responsible for the non-passage of the PIB.

    Thomas said: “I don’t believe that the bill would be passed into law before this National Assembly goes. I think the PIB will have to be addressed by the incoming National Assembly.’’

    He said as long as there is uncertainty surrounding the bill’s passage, the exploration and production firms might not want to invest.

    “The damage is that there has not been any exploration in Nigeria to find new oil or gas reserves. We need to make sure that the cloud of uncertainty, which is the lack of passage of the PIB is removed so that people know, the rule of the game. With the uncertainty removed, the regulators will be able to know what their roles and responsibilities are, and every stakeholder, including the communities, will know the rules of the game in the operation of the industry,” he said.

    Thomas urged political leaders   to put politics aside and think of the economic well-being of the people and the nation. He said: “They should put politics aside and do what is good for Nigerians and investors so that we have a bill that would address all the concerns and needs of the various stakeholders including the investors. We need to show commitment to the growth of the industry.”

    Also, the Managing Director, Treasure Energy Resources Limited, Rivers State owned Oil and Gas Company, Eddie Wikina, in a telephone interview, agreed that the government is prolonging investments in the country due to the non-passage of the bill.

    He also listed corruption and insecurity as other major factors affecting investments in the sector.

    According to him, if the bill is passed into law, it will help to check corruption in the Nigerian National Petroleum Corporation (NNPC). He said that the government has  misapplied the funds appropriated to the corporation by put them in wrong priority areas.

    Since the NNPC is not autonomous of the Federal Government, it acts on instructions.

    Wikina claimed the government was aware of this and continued to play down the passage of the bill.

    “Such a bill as the PIB has been shrouded in so much secrecy that certain unscrupulous elements begin to profit from the quagmire. Such a bill should be openly debated in the Senate and passed immediately in the interest of the nation,” he stated, urging the lawmakers to pass the bill before they go in May.

  • Investments in power sector hit N300b

    Investments in power sector hit N300b

    The Director-General, Bureau of Public Enterprises (BPE), Mr. Benjamin Ezra Dikki, has said over N300billion has so far been injected into the power sector by investors since the take-over, one and half years ago.

    Dikki, who made this known when he featured on Nigeria Television Authority’s (NTA) live programme—Good Morning Nigeria, according to a statement from the BPE yesterday, pointed out that the investment was for upgrade of power infrastructure which had become obsolete over the decades, noting that new technologies are evolving.

    He appealed to Nigerians   to be patient with   the evolving electric market in the country as the gains in the sector would not manifest overnight.

    The director-general explained that unlike reforms in other sectors which brought immediate results, the power sector  reform requires time as   investment in the  sector is capital intensive.

    For instance, he said power equipment, such as turbines and other ancillary products, “cannot be bought off the shelf. The investors have to place orders after which it will take between three to four months to manufacture the equipment before shipment. This takes time. Before Nigerians will begin see dramatic changes in the power sector, it will take between two to three years. But already, significant impact has been made”.

    Citing the Egbin Power Plant where the investor invested over N50billion to rehabilitate Line 6 of the plant to generate extra 240 megawatts, the Dikki said the cumulative effect of the investment is that power supply in Lagos and its environment would be greatly enhanced for the benefit of all consumers.

    He said because of the infrastructural development by the power investors, power interruptions in the country had reduced to the barest minimum while over 2, 000 engineers and technicians have been employed since takeover.

    The DG regretted that for over 16 years as a public monopoly, Power Holding Company of Nigeria (PHCN) neither employed nor brought in new investments into the sector.

    On complaints of non-availability of electric meters to consumers, the Dikki attributed it to the complex technology used in producing Smart Meters which are  being used the world over.

    He said the new Smart Meters have information on the consumer, level of power input and other statistics germane to the electricity market.

  • Deutsche Bank to boost investments by $1.4b

    Deutsche Bank AG said it’s working to boost its investments in green bonds to €1billion ($1.4-billion Canadian), joining competitors including Citigroup Inc. and Barclays PLC in tapping profit from the quickly growing market.

    The Frankfurt-based institution has invested €200million in green bonds and intends to expand that starting with purchases of a 10-year issue from the World Bank, according to a statement from Deutsche Bank. The funds are for the bank’s liquidity reserves.

    The decision adds to evidence that the green bond market is blooming after issuances of securities linked to climate projects more than doubled to a record $38.8 billion last year, according to data compiled by Bloomberg. The securities are earning “attractive returns,” said Alexander von zurMuehlen, the bank’s group treasurer.

    “The Green Bond market has matured during 2014, and the size and number of offerings has substantially increased making green securities viable and prudent liquidity buffer investments,” von zurMuehlen said in the statement.

    Investors are snapping up bonds to finance the global expansion of clean energy, promoted by governments from the U.S. to China to tackle climate change. The debt, issued by development banks or by project sponsors themselves, offers investors an alternative to volatile equities.

    It’s also increasing the flow of cash for clean-energy developments in nations from Spain to Romania, which have reined in support for the industry. Investment in clean energy rose 16 per cent last year to a record $310 billion, according to Bloomberg New Energy Finance.

    KfW Group, Germany’s state-owned development bank, sold $1.5billion of green bonds in the U.S. in 2014 after receiving demand for $2.5 billion of the securities.

    Deutsche Bank ranked eighth in terms of underwriting green bond deals last year, trailing SkandinaviskaEnskildaBanken AB, Bank of America Corp. and CréditAgricole SA, according to Bloomberg data. Investors included BlackRock Inc. and Calvert Investment Management have bought the securities.

    Deutsche Bank’s goal is cautious compared with other banks. On Wednesday, Citigroup said it would lend, invest and facilitate deals worth $100-billion by 2025 to support projects that will fight climate change and protect the environment.

  • Report: Nigeria lost N154b foreign investments in 2014

    Foreign investors took out over N154 billion in portfolio investments in 2014, it has been learnt.

    Concerns over Nigeria’s risk profile made many foreign investors to opt for the sideline, despite the attractive valuations of Nigerian’s equity investments.

    The latest Foreign Portfolio Investment (FPI) report of the Nigerian Stock Exchange (NSE) showed that Nigeria recorded a foreign portfolio investment deficit in 2014 as against the surplus recorded in 2013.

    The report, obtained at the weekend, indicated that Nigeria recorded a negative net foreign portfolio position of N154.14 billion in 2014 as against a positive net position of a modest N20.48 billion in 2013.

    The NSE report is generally regarded as a credible gauge of foreign portfolio investments in Nigeria because it coordinates data from nearly all active investment bankers and stockbrokers.

    Nigeria operates a mono-stock exchange, which makes the NSE the sole gateway to the nation’s stock market and the NSE’s benchmark indices, the country indices for Nigeria.

    The NSE report used two key indicators-inflow and outflow, to gauge foreign investors’ mood and participation in the stock market as a barometer for the economy. Foreign portfolio investment outflow includes sales transactions or liquidation of equity portfolio investments through the stock market while inflow includes purchase transactions on the NSE.

    The 12-month report showed that foreign portfolio outflow was N846.53 billion as against inflow of N692.39 billion in 2014, representing a net deficit of N154.14 billion. In 2013, total foreign inflow stood at N531.26 trillion compared with outflow of N510.78 trillion, leaving a positive balance of N20.48 billion.

    The report showed a notable spike in foreign transactions, although the negative colouration indicated that the propensity was towards divestment rather than investment. Total foreign transactions rose by 52.5 per cent to N1.54 trillion in 2014 as against N1.01 trillion in 2013.

    Meanwhile, foreign investors remained the dominant bloc at the Nigerian stock market. Foreign transactions accounted for 52.52 per cent of total transactions in 2014 while domestic investors accounted for 42.48 per cent. In 2013, foreign investors had accounted for 50.80 per cent while Nigerian investors accounted for 49.20 per cent. Domestic investors traded N1.137 trillion in 2014 as against N1.009 trillion in 2013.

    Market analysts said investors were anxious about Nigeria’s macroeconomic and monetary outlook in the light of the declining global oil prices and rising economic risks. They also cited the increasing political risk. However, analysts were positive on the outlook for the Nigerian market noting that the attractive valuation, resilience of the market fundamentals and the commitment of the government to pull through the global crude oil price challenge.

  • ‘Private sector investments in sugar hit N500b’

    ‘Private sector investments in sugar hit N500b’

    •Ban on imported packaged sugar stays

    Nigeria has attracted over N500billion private sector investments in the sugar sector under the Nigeria Sugar Master Plan (NSMP), the Minister of Industry, Trade and Investment, Olusegun Aganga, has said.

    The minsiter who spoke at the 2014 Sugar Forum in Lokoja, Kogi State yesterday, said the investments cut across 11 states of the federation. He listed the states to include Oyo, Ondo, Ogun, Adamawa, Kogi, Taraba, Jigawa, Kwara, Niger, Kebbi and Sokoto.

    He said within two years of the implementation of the NSMP, sugar prices have nosedived to an all-time-low, while  sugar refining capacity utilisation has moved up from 60 per cent to 75 per cent.

    He listed the interventions in the sugar sector under President Goodluck Jonathan’s adminsitration  to include trade instruments, “which give domestic products access to the local markets; and the N2billion Agricultural and Infrastructure Support Fund set aside at the Bank of Agriculture for investors in Government’s Backward Integration Programme.”

    Aganga said the Federal Government has created a N10billion funding pool, managed by the Bank of Industry (BoI), with a N5billion matching fund by the National Sugar Development Council (NSDC), among other intervention measures.

    While reiterating the ban on imported packaged sugar, he said: “So far, significant progress has been made in the sugar sector as a result of government’s policies. We are proud of what we have achieved so far, but more excited about what we can achieve as we go ahead.

    “The momentum we have achieved in the sugar sector is irreversible. We have started a journey that is difficult to reverse.

    “The NSMP was developed as a core component of the Nigeria Industrial Revolution Plan to fundamentally transform the sugar sector to create jobs, generate wealth and enhance economic growth. We’re gradually realising the targets under the plan.

    “The case to develop the sugar sector in Nigeria is clear, and the sugar master plan is our roadmap. By implementing a full scale sugar programme, Nigeria can produce over five million metric tonnes of sugarcane, which far exceeds the current domestic production of about 1.3 million metric tonnes per year.

    “This means that not only can we produce enough sugar for consumption, we can in fact become a net exporter into the sub-region and the wider international markets.

    “Under our current programme, we are on track to producing 1.7 million tonnes by year 2020, and to exceed this afterwards This is the first president that has had the vision and courage to embark on this journey of diversification.”

    Executive Secretary, NSDC, Dr. Latif Busari, urged importers of banned packaged sugar to come and produce in Nigeria under the NSMP, noting that this would create jobs for Nigerians and grow the economy.

    He said: “The implementation of the Nigeria Sugar Master Plan has been very successful so far; we will therefore not allow anything to derail the process. Imported packaged sugar remains banned.”

    Kogi State Governor, Captain Idris Wada, said NSMP is a success story, saying the state had already provided 250,000 hectares of land for sugar production.

    He said: “Nigeria has a great potential to produse enough sugar to meet local demand and for export. The journey so far indicates that the implementation of the sugar master plan has been a success story. “My administration is ready to support any investor by facilitating the provision of land for industrialisation and sugar production.”

  • Nigeria gets $67b direct investments in four years, says Emefiele

    Nigeria gets $67b direct investments in four years, says Emefiele

    Central Bank of Nigeria (CBN) Governor Godwin  Emefiele has said the Federal Government  received foreign direct investments worth $67 billion in four years ending 2013.

    The apex bank boss, who spoke at the weekend, said Nigeria’s foreign exchange reserves, which stand at $39.5 billion, can withstand nine months import cover, against three months regarded as norms internationally.

    He spoke at the 2014 chartered Institute of Bankers of Nigeria (CIBN) Investiture. The apex bank boss said the regulator would take steps that will make Nigeria withstand the oil price shocks ravaging world economies.

    Emefiele, who was conferred with the Honorary Fellowship of the CIBN said the apex bank’s microeconomic reforms led to increased foreign direct investments.

    The CBN boss, who spoke on the theme: “Making Nigeria a major destination for foreign direct investment”, said the CBN is also creating policies that create macro-economic stability and growth, adding that price stability will remain a Monetary Policy Committee (MPC) role in short and medium term.

    He said despite pressures of speculative behaviours in the forex market, the CBN would continue to intervene where necessary to stabilise the naira.

    “We will maintain healthy external reserves position. We expect the naira to remain strong going forward,” he said.

    Emefiele said that the CBN would have zero tolerance for policies that undermine financial sector stability.

    He advised bankers to be honest and exhibit highest level of ethics in the course of their duties. “ We want sound corporate governance and professional ethics,” he said.

    Analyses of the reserves based on data from the CBN showed that reserves were at $39.65 billion on August 25 and $38.4 billion on July 17. The rate of accretions to the reserves has been marginal but consistent since the CBN reviewed the bureau de change (BDC) policy guidelines.

    The reserves were at $37.23 billion on June 25; $37.26 billion on June 26 and $37.31 billion on June 27. The reserves also rose to $37.54 billion on July 1 and continued the upbeat till the current position.

    Further analysis showed that before the upbeat, the reserves had maintained a steady decline after closing last year at $42.85 billion.

    The year-end figure represented a decrease of $0.98 billion or 2.23 per cent against $43.83 billion at end-December 2012. The reserves dropped to $38.79 billion as at March 12. Analysts said the reserves declined as imports of fuel and foods soared.

    But the CBN said the decrease was driven largely by the increased funding of the foreign exchange market in the face of intense pressure on the naira and the need to maintain stability. The CBN said the pressure on external reserves was deemed to be consistent with the seasonal annual payment of dividends to foreign investors.

  • IFAD boss, others speak on agric investments in Ebola-affected countries

    IFAD boss, others speak on agric investments in Ebola-affected countries

    Ebola ravaged countries are not only contending with the debilitating ailment but also at a brink of a food crisis.

    Appalled by this development, Dr Kanayo F. Nwanze, President of the International Fund for Agricultural Development (IFAD), along with Florence Chenoweth, Minister of Agriculture, Liberia and Joseph Sam Sesay, ?Minister of Agriculture, Forestry and Food Security, Sierra Leone addressed a press conference on the concerns.

    IFAD is an international financial institution and a specialised United Nations agency based in Rome – the UN’s food and agriculture hub.

    Nwanze in his keynote address at the World Food Prize international symposium stressed the importance of investing in rural agriculture around the world, especially in the face of issues such as the current Ebola crisis, climate change, and other challenges.

    Worried that the food crisis could assume an epic proportion, the IFAD boss impressed on the governments at all levels to close ranks in order to stem the tide of food crisis and forestall other dire consequences.

    IFAD invests in rural people, empowering them to reduce poverty, increase food security, improve nutrition and strengthen resilience. Since 1978, IFAD has provided over US$16 billion in grants and low-interest loans to projects that have reached more than 430 million people.