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Tag: Nigeria News

  • Our kindness deficit

    Sometime last week, I was amazed by an interview I saw on CNN. It was about a new, well-funded institute that has been created to further research and study into one simple facet of human behaviour – kindness. The Bedari Kindness Institute, housed in the prestigious University of California, Los Angeles, UCLA, is funded by a $20 million donation by the Bedari Foundation, a private family foundation co-founded by Mathew and Jennifer Harris. The significance of research of this type in today’s world is monumental.

    If the idea seems unbelievable, or the funding, mind boggling, one only has to turn on the TV at any point in time to be reminded of the magnitude of strife and violence, poverty and disease, that burdens our world today. For the older generation, a trip down memory lane would also do the trick. That is, remembering a time when the world was a safer place to interact with others and form lasting friendships that endure for decades. Today, there is too much distrust and enmity, between countries, individuals and groups, across several dividing lines.

    One of the first things that came to mind after seeing the CNN interview, titled Spreading Contagious Kindness, is how Nigerians in particular can benefit from this kind of research. Our society is deeply divided, and our divisions are being emphasised every second of everyday, through our individual and group actions and that of people in leadership positions. The African continent is no different, despite the best efforts (which is not much) of associations like the African Union, AU, and the Economic Community of West African States, ECOWAS.

    If it were possible to measure the instinct for self-preservation in the mind of an average Nigerian, most Nigerians would score above 90%. This is not necessarily a bad thing. The negative part of this ‘selfish virtue’ is the cost, to inter-personal relationships and simple human kindness. Nigerians have been exposed to war, high level of crime and corruption and the stinging bite of extreme poverty, for years. The emotional trauma of fighting these evils has turned Nigerians into battle-hardened humans, with reduced emotional connections and a deficit of simple kindness.

    I also discovered, from further reading, that scientific research has been conducted for decades, into the subject of kindness and its effects on populations. Kindness, as research shows, is truly contagious. Witnessing an act of kindness or charity immediately ignites an emotional response that some have termed ‘elevation’, that triggers a desire to replicate that act or a similar act. Findings around this topic were published by researchers from the University of California, San Diego and Harvard University in the online edition of Proceedings of the National Academy of Sciences in 2010. Similar studies have also been carried out by researchers in Cambridge University and University of Plymouth in the United Kingdom, with similar results.

    In a country where it is considered a poor decision to offer a ride to a stranger stranded in the rain or scorching sun, mostly for security reasons, Nigeria may be a particularly interesting case study for the scholars in the new kindness institute at UCLA. As a dean of social sciences in the university puts it, the new institute seeks to be an antidote to the politics, violence and strife in the world today. In Nigeria, it was the politics, violence and strife that killed the historical kindness of Nigerians, and turned Nigerian society into an angry and impatient place that is unforgiving of the perceived weakness of even the slightest act of kindness and consideration.

    In Nigeria, researchers will be confounded by a society that steals supplies from Internally Displaced Persons, IDPs, condemned to a life of neglect and toil in their disease-infested camps; public officials that divert public funds and leave tens of millions in poverty and ignorance while their relatives enjoy opulence likened to some of history’s most powerful monarchs; religious bodies with multi-billion dollar ‘empires’ accepting money from people on involuntary fasting. The list goes on and on.

    Also, how does one encourage more kindness in a society that has been crippled by fear? For every act of kindness imaginable, Nigeria has a reason why it should not be done. For example, giving alms to beggars opens you to the danger of ritualists, as some will tell you. Here, turning the other cheek is not only a faux pas; it is a socially abhorrent behaviour that will be met with considerable disdain. The fear is always that, when you give an inch, the Nigerian society will likely take a mile, and continue taking until you go bust or join the band wagon of ‘“sharp” (selfish) Nigerians. The worst thing is, it is the truth.

    In the midst of all that chaos, Nigerians have not completely lost their humanity. Kindness still resides in our hearts, even if stifled by fear and misery. One at least agrees with the researchers that only more kindness can create a mass reaction that can multiply and bring the human factor back into our daily lives. It is not inconceivable that the late Dr. Stella Adadevoh could have chosen to be ‘sharp’ by protecting herself and warning her friends and relatives about a possible epidemic. She, and others, put their lives on the line and stemmed the spread of Ebola, which ended with her paying the ultimate price. That is humanity in action.

    Several tales of taxi drivers and airport attendants returning large sums of money, indigenous Non-Governmental Organisations, NGOs, stepping up to fill the void left by government, and even national leaders shelving ambition in the interest of Nigerians. This all means that there is hope. While progress may be slow in spreading community spirit and basic human consideration in a country of 200 million people, the research also shows that the kindness contagion, once started, spreads organically. As such, we need our political and community leaders, school children and students of all ages to benefit from these new research and studies, so that we can kick-start our own deliberate kindness experiment that may heal our communities.

    Billionaire Allen Onyema’s recent largesse, through Air Peace, where he provided free rides to help Nigerians escape violence in South Africa’s xenophobic attacks, is a case in point for spreading kindness. The man himself is a known philanthropist and a natural partner for the kindness institute in Nigeria, should the institute ever turn its focus on the country.  He founded the Foundation for Ethnic Harmony in Nigeria, FEHN, which has achieved the seemingly impossible by intervening in many conflict resolutions in Nigeria, including the de-escalation of Niger Delta militancy and subsequent training of ex-militants as part of the Amnesty programme of the Yar’Adua administration.

    Perhaps, if the Almajiri could be confident that northern elites are truly interested and invested in the Almajiri’s place in modern society, with the benefits and privileges that come with it, they will not be so easily cajoled into criminality and destructive causes that have become a nightmare for the entire country. Same goes for “area boys” and political thugs all over the country. Being neglected and consigned to the fringes of society, these outcasts have, overtime, embodied the manifestation of our lack of empathy and ultra-selfishness as a nation.

    Like the Allen Onyemas of Nigeria, Aliko Dangotes of Africa and Bill Gates’ of this world, if ordinary people can commit to promoting peaceful co-existence through random acts of kindness and material or emotional generosity, the world can truly be a better, more tolerable, place for billions of people. Where the kind gestures of billionaires can get lost in the maze of inter-personal suspicion and enmity at ‘ground level’, the missing piece of the puzzle may be our own emotional contributions and small material offerings as ordinary people, towards making a better life for ourselves. God knows that Nigerians need this, perhaps, more than any other group of people that I know.

     

  • NIN impedes micro pension sales

    The National Identification Number (NIN) is a major requirement for validating identities for business and services, including pension. Omobola Tolu-Kusimo, reports that the requirement has slowed the take-off of the micro pension plan

    The Federal Government’s plan to use the Number (NIN) for validating citizenship is affecting the new Micro Pension Plan (MPP).

    The Nation gathered that sale of the product is being hindered by lack of NIN by many Nigerians, especially those working in the informal sector, who are targets of the MPP.

    NIN, along with Bank Verification Numbers (BVN),  is a major requirement by the National Pension Commission before a Pension Fund Administrator can register a prospective customer for the micro pension plan.

    While many interested persons are able to produce BVN, few are unable to do so with the NIN card.

    The Federal Government had mandated every Nigerian to have a NIN card. It aims to use it to tie all records about an individual in the database and use it to establish or verify his or her identity. All citizens and legal residents in the country, from birth and above, are eligible for enrolment.

    Many Nigerians are yet to have NIN due to the few centres provided by the National Identity Management Commission (NIMC) for registration, among other challenges. They have lamented the delays in the registration for the NIN and obtaining the card.

    Micro Pension, on the other hand, is an initiative of the Federal Government, through PenCom, to capture workers under the informal sector, such as artisans, actors and actresses, engineers, lawyers and other self-employed persons.

    PenCom Acting Director General Mrs Aisha Dahir-Umar said the commission estimates capturing 30 million people in the informal sector.

    She stated that the MPP is expected to mobilise about N3 trillion savings into the over N9.4 trillion pension assets in the country.

    Since the launch of the MPP by President Muhammadu Buhari in March, this year, PenCom and PFAs have embarked on campaigns to sell the products. Unfortunately, the sales of the product have been low because majority of the people do not have NIN.

    PFAs have, however, lamented the difficulties in registrating for  NIN and obtaining the card by NIMC.

    National Identity Management Agency Director-General Aliyu Aziz said so far, they have about 1,000 centres nationwide with enrolment hitting about 36 million persons.

    He said: “We have about 1,000 centres nationwide and have enrolled about 36 million persons. But that number is small, compared to the overall population, and the number of centres we have is also small. The standard is that for every 50,000 people, we need a centre. So, if we are approximately 200 million, it means that we need, at least, 4,000 centres to be optimal. But for the size of the country and the demand, we need up to 10,000 centres and the plan is to achieve that.

    “To cover the shortfall, we have come up with a sustainable programme nicknamed, Ecosystem; that is, to work with other government agencies and the private sector that are collecting data to send to the NIMC and the commission will pay them per successful enrolment.

    ‘’We have done a lot of preparation for this activity. Therefore, the number of enrolment centres will increase and there will be a motivation to carry out the enrolment because they will be paid. We believe that the ecosystem approach will solve the problem.

    “The focus before was on the card but we have learnt from the United States, the United Kingdom and India that the focus should be on the national identification number. Therefore, we have gone back to the foundation and that is why the number grew to 36 million. So, our law says that we should also issue a general multipurpose card and that the first issuance should be free; that was in 2012. But because of the economic situation, we were unable to issue 36 million cards free. So, the focus is to emphasise on the number and allow the government agencies to accept the number and issue services. So far, the banks, Nigeria Immigration Service, Federal Road Safety Corps, National Pension Commission and others accept the NIN to give you service and, therefore, reduce the pressure from the demand for the card.’’

    PenCom spokeperson, Mr Peter Aghahowa in a telephone conversation with The Nation said the commission is working to hasten the progress of the MPP.

    He confirmed that NIN has slowed down registration for the MPP.

    He disclosed that the commission is partnering NIMC to register people who want for micro pension.

    “The micro pension take-off has not been as fast as we want it but people are enrolling. It is a fact that NIN has affected it but we prefer to do it right. PenCom is having an arrangement with NIMC that will aid people to get NIN by collecting information and passing them to NIMC who then gives us the NIN number,” he added.

  • FATE Foundation urges entrepreneurs on integrity

    FATE Foundation has urged entrepreneurs to exhibit high level of integrity to achieve their desired growth and development.

    The advise came during the foundation’s fourth Alumni conference in Lagos.

    The event attracted Lagos State Deputy Governor, Obafemi Hamzat, Slot Systems Limited, Chief Executive Officer, Nnamdi Ezeigbo and Senior Partner, TLcom Capital LLP, Mrs. Omobola Johnson, among others.

    Hamzat, who expressed gratitude to the management of FATE Foundation, said: “The support for SMEs is one with priority focus by the administration in Lagos State as the reality has shown in other growing economies globally, that the SME sector is vital for economic growth. Through the support of SMEs and the private sector, it will help propel expansion of these businesses, which would enable job creation in the state.”

    He urged young entrepreneurs to always maintain integrity and honour, which is key for business growth, hard work in innovating and providing unique experiences for customers and believe in God.

    Ezeigbo said budding entrepreneurs to focus on building a strong brand, which will give them an edge in attracting investment opportunities and support from stakeholders, especially in Nigeria due the competitive landscape and lack of trust faced by snall and medium scale entreprises (SMEs).

    He said: “It is important for entrepreneurs to understand their business capabilities and align it with their business strengths, while he implored them to re-engineer their process in identifying the right people that the business needs to succeed in ensuring synergy of objectives and growth.

    “It is important for businesses to understand their competitor’s strengths and weakness, which will help in developing innovative strategies as well as pre-empting them activities, but also key for every entrepreneur is to build strategic alliances and partnerships as strong networks helps to grow brands and businesses.’’

    FATE Foundation Executive Director Adenike Adeyemi stated that the foundation, founded by Fola Adeola, alongside some individuals, over 19 years ago, has trained over 5,000 persons across 20 states.

    She stated that the conference themed “Innovating for scale” was aimed at empowering its alumni with the right tools to develop strategies and innovative approach in building their business, product, service for their customers and target markets.

     

  • Edo govt, stakeholders partner to boost tourism

    The Edo State government and stakeholders in the state’s tourism sector have identified new channels and offerings to attract more tourists to the state, as part of strategies to expand the portfolio of its assets in the arts, culture and tourism sector to grow inbound tourist traffic.

    This was the outcome of a parley organised by the Ministry of Arts, Culture, Tourism and Diaspora Affairs, to mark the  World Tourism Day in Benin City, the state capital.

    Held at the Ogba Zoological Garden in Benin City, the stakeholders said the new offerings would include siting of clean markets for tourists, inclusion of tourism studies in school curricula, re-engineering of monuments to their original specification and promotion of community tourism.

    Commissioner for Arts, Culture, Tourism and Diaspora Affairs, who was represented by the Permanent Secretary in the ministry, Mrs. Dorcas Idehen, said the state government is reviving tourism sites in the state to provide means of livelihood for youths and women and also boost economic diversification. He urged youths to take advantage of reforms in the tourism industry to make money for themselves and their households.

    The commissioner stressed the need for preservation of Edo culture; its language, food and history through which more tourists can be attracted to the state.  He assured that adequate preparation is being put in place ahead of the hosting of the National Festival of Arts and Culture (NAFEST), during which jobs will be created and boost the state’s tourism potential.

    The Managing Director, Ogba Zoological Garden, Andy Ehanire, said tourism remains a veritable means of boosting job creation in Edo State, especially with the state’s rich cultural heritage, sites and monuments.

    Ehanire highlighted factors that would improve tourism development in the state to include siting of clean markets for tourists; inclusion of tourism studies in school curricula, and re-engineering of monuments to their original specification and promotion of community tourism.

    He noted that tourism offers a lot of opportunities for youths to be engaged as tour guides, travel agents, tour operators, among others.

  • ‘Every piece I have created is my child’

    If you visit Universal Studios of Arts (USA) at the National Theatre, Iganmu Lagos anytime of the week, you would  find metal sculptor, Fidelis Odogwu, is in constant communication with metal. At his studio located within the premises of USA, there is a battle between him and metal there.

    Odogwu is best known for his versatility with metal sculpting. Working with metal is tedious and strength consuming, but because he has mastered the act of bending metal to any shape or form, he does it with ease.

    “I like challenges, I like tasks and I like doing what people see as impossible because I believe everything is possible on this planet earth. I decided to do metal sculpting because people were running away from it during my undergraduate days,” said the Agbor Delta State-born artist.

    “Very few people were working with metals then. They almost convinced me that it was not possible to work with metals, but I told that it is possible. I embraced the medium when everybody was running away from it. Of the 11 people who graduated in my set in 1991, nobody wanted to explore metal.”

    There is an arresting effect you get from his works. At  a glimpse one is forced to assume that his work is caved out of wood because of the way he manipulates metal. His sculptures present juxtapositions of reality and impressionism. No doubt, Odogwu has earned himself the title of a Master Sculptor with his consistency and hard work.

    He introduced colour to his sculptures about four years ago because he remains open-minded to anything that might present a new possibility in the context of his work. His use of colour on metal (sculptor-paintings), catches the eyes and holds your attention with the fascinating pose of each subject with colours and light impressions. “I started to apply colours to make the work look more graceful.”

    For these 28  years, he has evolved, the conceptual, the use of material and in innovation. “You don’t have to be a macho man to be able to work with metal. Metal with its characteristics is malleable. When we were doing method and material we were taught that metal is malleable, so I experimented and it is. So, if I can beat my metal to flat face to give me some shapes and forms, it means, I can do it.”

    Most artists seem to have women as their subjects, but not Odogwu. Anything can be his subject. His work is not self-generated as everything around him serves as a source of inspiration. His work seems to allure some intelligently discerning art connoisseurs. “Everything around me inspires me– even the plant, there is a way the wind will blow it and you as an artist gets inspired by the movement of the plant, and you want to capture the movement with your work,” he disclosed.

    On how he was able to create some pieces, he said: “I am an artist and don’t forget after God is the artists. We create valuable things from nothing and the way we see things is different from the way others see them.”

    Currently, his second solo exhibition is ongoing in Lagos, at OM’s Flat, a private gallery at Ikoyi, with 28 works on view. Some of the  works are from his private collection and some celebrate distinguished figures, such as Fela Kuti, Mother Teresa, Bob Marley, Martin and Luther King. which he has in his Legend series. “I have to celebrate these people who have made impacts in our society,” he said.

    When you look at his works on display, you see happy people, you see drummers, people–obvious he is a happy man because it takes a happy man to capture happy people. “It’s what I have inside that I give out. It means there are joy, freedom and happiness inside me. I want people to feel what I feel too with my work. Also, I preach peace, togetherness and bonding with my work. I believe whether you are black or white we are one.” This, he captured with pieces he titled: Drummer (series), Egwu Nyagan (series) and Rhythm, the Delegates, Family Tree, Enyinle Wu Ohu (one people), Akpukpa (peace and beauty) and Water Fiesta.

    This exhibition marks his 28 years’ experience after his graduation from Auchi Polytechnic, Edo State in 1991, where his interest in metal sculpturing started. The exhibition curated by OM Exhibition will remain on view through October 13.

    He affirmed that an art piece has to be appealing. ‘’I have a storyline, interpretation, it has to call one’s attention to look at it again. There is a story behind every piece I create. I have been telling this story for 28 years,’’ he said.

    The third part of the works on display are unified by elegant, beauty and sensual titled: Old Wine in New Keg, Iyawo Asiko (series), Ochor Nma and Niofurun (will it fit); series of nude women.

    Can Odogwu remember a piece he created and didn’t feel like giving it out? “Every artwork that I have created came from me and I value all my pieces. There is this emotional attachment to every piece because it came from me and every of my piece is like my child. When I give it out,  it is like giving my child out, a piece of me. I will keep all my works if I am comfortable and have space, but I can’t keep them for life to go on,” he said.

    He was mentored by renowned master sculptor, Ben Osawe ‘’who was interested in me and what I do. Very good sculptor and mentor, he was there for me as a mentor.’

    Odogwu’s works are collected within and outside the country. How does Odogwu feel  after many years of practice? “I feel fulfilled and happy with where I am as an artist. Life is a continuum, I am still alive, I will be doing what I am doing and be evolving,” he said.

  • Quest for economic emancipation continues

    As Nigeria celebrates her 59th year of independence, the state of the economy now and in the coming years has been of concern to government and observers. The Muhammadu Buhari administration’s second term will make or break the administration depending on the policies it churns out and how effectively it executes them, Assistant Editor, Nduka Chiejina reports.

    Determined to continue  the struggle to acheive total economic independence thropugh policy formulation and implementation, the executive arm of government submitted the Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) to the  National Assembly.

    The document set fiscal targets and strategically allocating resources to achieve developmental aspirations that are central to the planning and budgeting process.

    The MTEF and Fiscal Strategy Paper (FSP) provide information on the impacts of government’s economic and fiscal policies, economic and fiscal environment update, as well as budget policy/process.

    It is a tool required by law, to ensure and sustain the link between policy on one hand and planning/budgeting on the other, over the medium-term, on a three-year rolling basis.

    It is designed to translate economic plans into public expenditure programmes within a coherent multiyear macroeconomic and fiscal framework. It indicates fiscal targets and estimates revenues and expenditures, including government financial obligations.

    To restore the economy to the path of growth, the 2020-2022 MTEF/FSP will signal the direction of government priorities and programmes to accelerate growth.

    The MTEF/FSP will set out the key parameters and assumptions underlying fiscal policies, as well as the revenue and expenditure profile of the 2020 federal budget.

    According to Finance Minister , Mrs Zainab Ahmed, “the projections contained will be guided by budget realism.”

     

    Macro-economic performance

    The says the economy has gained some traction, having sustained eight consecutive quarters of gross domestic product (GDP) growth. “Annual growth has increased from 0.82per cent  in 2017 to 1.93 per cent in 2018 and 2.10per cent in 01 2019 (an upward revision from 2.01 per cent due to oil output revisions). However, the growth of 1.94per cent observed in 02 2019 indicates a decline by 0.16per cent points. The performance observed in 02 2019 follows an equally strong first quarter performance and was aided by stability in oil output” the document said.

    Nigeria signed the agreement establishing the African Continental Free Trade Area (AfCFTA), on  July 7, after extensive stakeholders’ consultations and impact/readiness studies. AfCFTA is expected to boost intra-African trade and engender the development of policies that promote African production. AfCFTA intends to cover goods and services and has complementary programmes for infrastructure, industrialisation, agriculture modernisation, small scale trade, as well as innovation, intellectual property, competition and investment.

     

    Monetary policy

    The Central Bank of Nigeria (CBN) reduced the Monetary Policy Rate (MPR) by 50 basis points to 13.5per cent in March 2019 after holding it steady at 14.0per cent for 20 months, but retained the Cash Reserve Ratio (CRR) at 22.50per cent and Liquidity Ratio at 30.00per cent. However, the MTEF document raised serious concerns that “in reality, the MPR has ceased to be a key determinant of market interest rates over the past three years. Average lending rates of Deposit Money Banks (DMBs) over the last three years have ranged from 15.33per cent to 31.05per cent” the document said.

     

    Fiscal policy

    Nigeria’s revenue base is broadly categorised into oil and non-oil. Oil revenue is primarily from crude oil receipts while non-oil earnings are from taxes generated.

    The document read: “Receipts from both sources have collectively accounted for about 65per cent of total receipts since 2015. In response to the economy lapsing into recession in 2016, government’s fiscal policy stance was to increase aggregate expenditure. Hence, there has been a rise in nominal budgetary expenditure in the past three years.”

    Making adjustments for inflation, output growth and currency depreciation, the document said “expenditure remains lower than its pre-recession level.” It expressed worries that the current fiscal position is ‘threatened by widening fiscal deficit’, which has forced the government to increasingly access the debt markets to meet its obligations.

    “The resultant rise in debt has increased the federal government’s debt service obligations as a percentage of federal revenues to over 50per cent, thereby raising debt sustainability concerns. It is therefore imperative that government explores alternative means to raise substantially higher revenues to sustainably meet all its obligations” the document urged.

     

    Budget 2019 implementation

    The 2019 Budget Proposal was intended to place the economy on “the path of higher, inclusive, diversified and sustainable growth, in order to continue to lift significant numbers of our citizens out of poverty.” However, the performance of the key parameters driving the  budget year-to-May shows that GDP growth, opil production were below target, while oil price is running ahead of projection.

     

    Key performance parameters

     

    Oil revenue

    Gross oil and gas budget revenue is projected at N9,326.95 billion for 2019. Of this, N3,886.23 billion was expected as at end-May on prorata basis. However, only N2,162,30 billion was realised. This represents 81.5per cent performance. After deductions (including 13per cent derivation), net oil and gas revenue inflows to the Federation Account amounted to N1,432.07 billion. This represents a shortfall of N1,736.55 billion (or 22.8per cent of the prorata amount). Lower than projected oil production, as well as front-loaded costs by NNPC for federally funded projects, were largely responsible for the shortfall.

     

    Non-oil revenue

    The sum of N1,715.38 billion was generated as non-oil revenues as against N2,140.21 billion projected. This implies a collection performance of 80.1per cent. Of this, Corporate Tax and value added tax (VAT) collections were N666.74 billion and N604.98 billion, representing 75.7per cent and 70.9per cent collection performance respectively. Customs collection was N408.17 billion or 100.5per cent of the projection as at June.

     

    Federation,VAT distributable

    The cash available for distribution from the Federation Account was N2,964.83 billion, representing 57.5per cent of N5,156.56 billion expected .. Of this, the Federal Government received N1,562.37 billion while the states and local lovernments received N791.92 billion and N610.54  billion respectively. Federal, state and local governments received N87.17 billion, N290.56 billion and N203.39 billion respectively from the VAT Pool Account.

     

    Federal Govt revenue

    Federal Government’s actual revenues totaled N2,043.32 billion out of N3,499.24 billion projected as at June 2019. Out of this, oil revenue was N900.42 billion (49per cent of prorata budget) while non-oil taxes and independent revenues were N614.57 billion (87per cent of the prorata budget) and N217.84 billion (69per cent of the prorata budget) respectively.  Company Income Tax (CIT) and VAT collections were N349.11 billion and N81.36 billion respectively, representing 86per cent and 71 per cent of targets. Customs collections was N184.10 billion, of which N173.28 billion was from import duties, excise and fees, while N10.83 billion was from Special Levies.

    The shortfall in CIT collections is partly due to seasonal factors as most companies remit their income taxes during the second half of the year. The slow recovery in economic activities that drive consumption and the lingering security issues contributed to the underperformance of other non-oil revenue sources such as VAT. Non-oil revenue collections, especially income and consumption taxes, are expected to improve as the fiscal year progresses and economic activities increase, with improvements in tax collection efforts, and continuing implementation of policies to improve the environment for doing business in Nigeria.

     

    Expenditure

    Of the N4,458.48 billion budgeted spending by half-year 2019, N3,390.13 billion has been spent, that is, 76per cent. The spending was largely on recurrent expenditure, including N1,109.10 billion for debt service. “As at end of June 2019, no release has been made for capital expenditure as the Budget was only signed into law in June 2019.”

    Implementation of the capital budget will be expedited to ensure that critical priority projects are completed or substantially progressed.

     

    Non-oil revenue

    N1,715.38 billion was generated as non-oil revenues as against N2,140.21 billion projected. This implies a collection performance of 80.1 per cent. Of this, Corporate Tax and VAT collections were N666.74 billion and N604.98 billion, representing 75.7per cent and 70.9per cent collection performance respectively. Customs collection was N408.17 billion or 100.5per cent of the projection as at June 2019.

     

    MTEF 2020-2022

    For the medium term years of 2020-2022, the Gederal Government has set a benchmark oil price of $55 per barrel. This, the government said, “is very important to set the oil price benchmark below the forecasts in order to insulate the budget from the usual significant adverse effects of the price falling below the budget benchmark. More importantly, the approach would enable us to build fiscal buffers which can be used to respond effectively to negative oil price shocks in the medium term. Adequate buffers are useful in preventing pro-cyclical policies which would require significant expenditure reduction when oil prices are down, thereby impeding economic growth and development.”

     

    Non-oil revenue assumptions

    The assumptions underlying the non-oil revenue forecasts for the period 2020-2022 are based on estimates mainly determined using “anticipated growth in the relevant bases for different taxes, the effective tax ratio of collections, and the projected efficiency factor taking account of operational improvements in the operations of the various tax administrators.”

    The various measures to improve non-oil tax revenue in the medium term include stronger enforcement efforts against tax defaulters; implementation of the Integrated Tax Administration System project; full self-assessment regime for all taxpayers; increased deployment of new technology to improve revenue collection; and stepping up of anti-smuggling activities by the Nigeria Customs Service (NCS). Government the document revealed “intends to sustain the increase in contribution of tax revenue to the budget through continuous reforms to modernise and further improve tax administration.”

     

    Underlying bases

    The projections of import duties are based on the cost, insurance and freight (CIF) value of imports, applicable tariffs, and an efficiency factor. The nominal growth of the tax base was assumed to be driven by a tax elasticity in the medium term. The Nigeria Customs Service (NCS) is employing the use of technology to enhance efficiency in customs revenue collection.

    The Service will continue the roll-out of the Nigeria Integrated Customs Information System (NCIS II) trade portal across the country for declaration, processing, licencing and exemptions and manifest submission. This solution the document said “will merge the different stand-alone systems and block all loopholes identified in the current system. To further eliminate revenue leakages in the calculation of customs duty, insurance will be automated to complement the automation of Form M (Cost) and Manifest (Freight).”

    In addition, excise trade will be automated using blockchain technology. This will bring greater transparency and accountability across complex business networks, enabling real time tracking of assets. In the medium term, the NCS will introduce frameworks for effectively recovering duties, taxes and appropriate fees from transactions conducted over electronic networks such as the internet. Also, non-intrusive inspection technology equipment (scanners) will be procured and deployed to critical ports to ensure national security and trade facilitation.

    To further increase port efficiency, tighten border controls to check smuggling and reduce revenue leakages, the Single Window Project will be implemented.

    Companies Income Tax (CIT) projection in the medium term is based on the estimated nominal GDP, companies’ profitability ratio, and an efficiency factor. In addition, improved collection efficiency arising from increased efforts at broadening and strengthening the tax net, taxpayer engagement/enlightenment and enhanced use of technology, are expected to enhance CIT collection performance.

     

     

     

    The Federal Inland Revenue Service (FIRS) is placing lien on about 3,000 non-compliant tax payers’ bank accounts with turnover of N1 billion and above. This is to be drilled down to companies below the N1 billion turnover threshold.

    FIRS will also leverage e-solutions such as e-registration, e-filing, e-Tax payment, e-TCC, e-Receipt, e-Stamp duty and FIRS-GIFMIS integration. These initiatives are expected to significantly reduce the incidence of tax evasion thereby increasing the tax collectible. Overall, this is expected to result in a reduction in the adjustment factor for the CIT base and improvement in collection performance in the medium term.

    VAT collection projection is based on estimated total nominal consumption of vatable items and collection efficiency. Nominal consumption is projected at N122.75 trillion in 2020 from estimated N119.28 trillion in 2019. The VAT projections over the medium-term are based on a rate of 7.5per cent. This will be effected through the Finance Bill which will accompany the 2020 Budget Proposal.

    The document assured that “the proposed increase in VAT rate will not adversely affect the poor as the VAT Act already exempts goods that are consumed by the poor. The list can be expanded if there is need to do so. Efforts will be geared towards enhancing VAT collections by broadening VAT coverage and improving collection efficiency. This will be achieved through continuous nationwide VAT registration and monitoring, as well as the use of technology for auto-collect platforms in more sectors of the economy.”

    In addition, the solution to deduct and remit VAT and Withholding Tax (WHT) from State government contract payments is to be deployed to all the 36 states. VAT collection efficiency is expected to increase from the present average of 21per cent of the projected nominal consumption to at least 25per cent in 2020, 30per cent in 2021 and 35per cent in 2022. The FIRS will also tap into the Central Bank’s financial inclusion initiative for the informal sector by investing in infrastructure to bring them into the tax net.

      Independent revenue

     

    Government-Owned Enterprises (GOEs) are still bedeviled by revenue leakages and weak accountability. Hence, additional measures will be introduced to ensure that they operate in a more fiscally responsible manner. GOEs will be required to observe maximum cost-to-income ratios and substantially improve remittances in the medium term, under a new performance management framework.

     

    Macro-economic revenue projections

     

    From the share of the Federation Account and VAT as well as other revenues, the aggregate revenue available to fund the 2020 budget is projected at N7.17 trillion (2.4 per cent or N170.41 billion more than the 2019 Budget of N6.99 trillion). 34.2per cent of this is projected to come from oil sources while the balance is to be earned from non-oil sources. When the retained revenues of the ten major GOEs are considered the aggregate FGN revenue is projected at N7.72 trillion.

    In the medium term, government will continue to engage with stakeholders in the Niger Delta to ensure conducive environment for oil production, distribution and export. In addition, pipeline security will be further enhanced to attract new investments. Oil revenues will be used to further diversify the production and revenue base of the economy.

     Expenditure framework

    The expenditure budget is estimated at N9.12 trillion (this includes grants and donor funding of N36.39 billion). This is slightly higher than the 2019 of N8.92 trillion. Interest payments on debt is estimated at N2.45 trillion and while provision for Sinking Fund to retire maturing bonds to local contractors is N296 billion. The provisions for personnel cost and pension costs are estimated at N2.67 trillion and N536.72 billion respectively. In addition, N40.17 billion (representing one per cent of the consolidated revenue fund) has been earmarked for the Basic Health Care Provision Fund (BHCPF), N22.73 billion for GAVI/Routine Immunisation in the service-wide votes (SWV), and N89.44 billion for the power sector reform programme.

    With these provisions, only the sum of N1.01 trillion (exclusive of capital in statutory transfers) is available as amount for Ministries, Department and Agencies (MDAs) capital expenditure. With the inclusion of capital in statutory transfers, capital supplementation, and grant and donor funded projects, as well as Multi-lateral I Bi-Iateral project-tied loans of N328.13 billion, the capital expenditure amounts to N2.17 trillion.

     

    Aggregate expenditure

     

    With the inclusion of the planned expenditure of the top 10 GOEs of N553.14 billion, the proposed aggregate expenditure rises to an estimate of N10.00 trillion. With the inclusion of the GOEs capital estimated at N 188.23 billion, aggregate capital expenditure (inclusive of capital in statutory transfers) is estimated at N2.17 trillion. This represents 22per cent of the aggregate projected Federal Government expenditure in 2020, which falls short of the 30per cent target in the Economic Recovery and Growth Plan (ERGP). This is the consequence of the slower growth in revenues than the rate of growth in non-discretionary recurrent expenditures, specifically debt service and personnel costs.

     

    Fiscal Deficit and Deficit Financing

    Given the projected revenue and planned expenditure, the fiscal deficit is estimated at N1.95 trillion, about N33.61 billion (or 1.8per cent) more than the estimate of N1.92 trillion in 2019. This level of deficit is 1.37per cent of GDP – well below the threshold (three per cent of GDP) stipulated in the Fiscal Responsibility Act (FRA), 2007. In order to present a more comprehensive picture of the FGN’s fiscal operations, the revenues and expenditures of the top 10 GOEs as well as expenditures financed from project-tied loans will -be captured in the FGN’s budget. Accordingly, the aggregate fiscal deficit for 2020 will be N2.28 trillion, which is 1.59% of GDP. The deficit will largely be financed by new borrowings estimated at N1.70 trillion while about N252.08 billion will be derived from Privatization Proceeds, and N328.13 billion are loans secured for specific development projects.

    In 2020-2022, Government will continue its fiscal strategy of directing resources to most productive and growth-enhancing sectors including Security, Infrastructure (including Power and Transportation), Agriculture, Manufacturing, Housing and Construction, Education, Health and Water Resources. This is with the aim of reducing the current infrastructure gap, creating employment opportunities and enhancing growth performance. Government will also leverage private capital to supplement capital allocations from the Budget.

     

  • Cutix to acquire Adswitch

    Cutix Plc has announced plan to acquire Adswitch Plc,  a related electrical switchgears company that was delisted on the Nigerian Stock Exchange (NSE) in 2016.

    Adswitch, a Nigerian company, was incorporated in 1982 and it has a close relationship with Cutix Plc.

    The board of Cutix stated that it the acquisition is intended to enhance business expansion and boost the profitability of the company.

    The board has put a special resolution on the acquisition as one of the items for approval of shareholders at the forthcoming annual general meeting on October 25, 2019.

    The directors of Cutix, a wire and cable company, are seeking the mandate of shareholders to enable them enter into any agreements and execute any other documents necessary for and incidental to effecting the resolution on acquisition of Adswitch.

    Cutix is an indigenous company wholly owned by Nigerians. Incorporated in 1982, the company gradually transformed from a private limited liability company formed and owned by friends and family members to become a publicly quoted company.

    Cutix recently invested about N300 million on a new extension of its factory as part of efforts to increase the installed production capacity of the cables-manufacturing company. The new factory extension was expected to impact positively on the production capacity and efficiency of the company and to enable it to further improve its performance notwithstanding the increasing competition in the cables industry.

    Adswitch had delisted from the NSE due to what the directors of the company then broadly described as harsh operating environment. The company, which was listed as a second-tier stock in 1991, filed for voluntary delisting at the NSE.

    Market analysts then described the harsh business climate as operational challenges due to influx of fake and substandard products and uncompetitive manufacturing costs in Nigeria as well as the costs and requirements of maintaining the listing.

    Prior to its delisting, Adswitch had struggled with dwindling margins and sales. Audited report and accounts of Adswitch for the year ended April 30, 2012 showed that turnover dropped from N32.72 million in 2011 to N30.7 million in 2012. It posted a loss before tax of N10.34 million in 2012, albeit a better position that loss of N19.04 million recorded in 2011. Loss after tax also stood at N10.73 million in 2012 as against N19.69 million in 2011.

  • Ikeji Aro: Homecoming for Aros

    Its origin dates back to 912 AD in the ancient town of Arochukwu, the ancestral home of all Aros at home and the Diaspora.

    The month-long New Yam festival tagged Ikeji Aro came to its climax on the Eke Ekpe when different cultural troupes and masquerades from 19 villages that make up Arochukwu town performed and competed for prizes.

    Mazi Ogbonnaya Okoro, the Eze Aro of Arochukwu Kingdom, represented by the triumvirate of Okennachi, Eze Ibom isi and Eze Agwu,  the traditional rulers of the 19 villages, the President-General, Nzuko Arochukwu World-wide, Mazi George Okoronkwo Ezumah, and his executive members  and several prominent sons and daughters of the ancient kingdom, including other kith and kin from Arochukwu in the Diaspora were all in attendance.

    They led the entire community, guests and tourists in a procession into Amaikpe, the ancestral square where Aros gathered for major events to celebrate Eke Ekpe, the highest activity of the three-week long new yam festival.

    Ikeji festival is celebrated annually to mark the end of the year.

    It is observed in over 350 Arochukwu outpost communities, culminating in the grand finale at the ancestral home, Arochukwu, Abia State. The Aro monarch releases the calendar following the indigenous lunar calendar that coincides with the month of September, but at times spills over to October. This year’s festival started on September 4, and ended on September 26. Ekekpe is the climax of the festival featuring all the villages, Aro diaspora, Aro allies displaying masquerades and dances. It is a season dedicated to showcasing Aro’s rich cultural heritage, renewing of ancient covenant that unite Arochukwu kingdom and thanksgiving to God for a successful year.

    This year’s edition attracted Aro kith and kin from Umuakali-Naze, Owerri, Imo State who are residing overseas. For some of them, it was their first visit to Arochukwu, their ancestral home. The largest Aro outpost community, Arondizuogu also from Imo State stormed the occasion with three thriller masquerades which threw the entire venue into spontaneous ecstasy.

    An interesting aspect of this year’s edition was celebrated with some modern touch as the current leadership of Nzuko Arochukwu that came into office three years ago re-branded the Ikeji festival thus attracting corporate sponsorship by local and international brands such as MTN, Airtel, Nigerian Breweries, SHOBAZ as well as collaboration with the youth, budding entrepreneurs such as The Rare Gem, Emmy Entertainments & Events, among others.

    This fourth edition is building on the successes achieved in the last three years and will serve as a home-coming event for Umuaro in various places.

    The yearly cultural festival presented a unique opportunity to celebrate Arochukwu tradition and culture in its pure and original form. It is also a platform for infinite entertainment, commerce and tourism as it features huge home coming, rare masquerades, traditional dances and  cultural displays.

    Arochukwu indigenes who could not make it home, especially those overseas, watched the event online. It was beamed globally

    According to Chairman, Ikeji Organising Committee, Dr Azubike Okoro, this year’s event, aside from expanding the commercial frontiers which presented bigger opportunities for businesses, featured other innovations.

    “For example, given the significant role of youths as agents of development, we worked in concert with the umbrella body of Arochukwu youths/students (NASS), to ensure the attainment of the goals of active participation of their members by providing a platform to showcase their talents and creative energies aimed at the advancement and growth of the kingdom.

    Tagged Arochukwu Got Talent, it took place on Eke Ekpe evening, after the parade of colours in the afternoon,” Okoro  stated.

     

  • How snacks making changed my life

    Adeshina Temitope, a 300-level student of Home Economics Education of Adeniran Ogunsanya College of Education, Lagos State, is also into snacks business, DANIEL ESSIET reports

    Like many entrepreneurs, Adeshina Temitope knew she was cut out for business.

    Her words: “I thought of something to add to my income while teaching since I have the skills before gaining admission into higher institution. I found out that it is better for me to start something, that with time, hardwork and patience, it will grow bigger.”

    She started with snacks with a leap of faith. Raising capital, however, proved challenging. She was able to raise N8, 000.

    Since then, the business has grown with the net worth hitting N70,000.

    The business is helping her pay fees and earning a living.  She said: “I thank God because the business has been helping me, because I don’t worry about textbooks, practicals, school levies, though my parents support me.

    “I don’t really have  workers, but I have roommates that are very supportive; so, it makes the work easier.”

    For her, confidence and courage were keys to her survival.

    She aims to eliminate the dilemma between eating well and eating fast. All items are prepared  each morning.

    She is passionate about food and even more passionate about people. She doesn’t only make snacks and cakes more accessible, but also ensures that the ingredients are carefully sourced.

    She has been a major inspiration for youths. Her advice for young people struggling to figure out their life purpose: “It takes focus and intention to listen to your heart and figure out what makes you thrive. Once you’ve figured out that part, it’s simply having the courage to take. My advice to any young entrepreneur is to be determined; when you are determined your goals will be easier to accomplish as determination leads to success,’’ he said.

    The biggest challenge she faced was getting retail buyers to move beyond their initial disbelief that anything good could come from street food vendors.

    She has other challenges. “My failure has been on the quality of the snacks, at a point I decided to reduce the quality to gain more profits but customers noticed and complained. I learnt that you don’t compromise on the quality rather you improve on it that is, quality but not quantity.”

    The business has had pressure on her too. “What sacrifice have you had to make to be a successful entrepreneur?

    Am currently schooling, during the holiday that am supposed to go home, I always stay back to run my business because I believe my punctuality and consistence will help my business grow.”

    Her passion, network of people, professionalism and her ability to pivot were keys to her success.

    She has such amazing people to fall back on — family, friends, people in the industry. She asked tonnes of questions and loves learning from people.

    In 10 years, she sees her self having a big outlet with different sections such as   snacks, cake, cocktail and other things.

     

  • Transcorp retains positive rating

    Transcorp Hotels Plc, the hospitality subsidiary of Transnational Corporation of Nigeria Plc (Transcorp) and owner of the Transcorp Hilton, Abuja and Transcorp Hotels, Calabar, has retained its national scale ratings at A-(NG) and A2(NG) in the long-term and short-term, with the outlook accorded as stable.

    Concurrently, the national scale ratings accorded to the following Issuances affirmed Series 1 N10 billion Fixed Rate Bond: A-(NG), Stable Outlook; Series 2 N9.8 billion Fixed Rate Bond: A-(NG), Stable Outlook.

    According to GCR, the rating reflects Transcorp Hotels ability to maintain its market position as a leading brand in Nigeria’s hospitality industry, supported by the major renovation and facilities upgrade at Transcorp Hilton Abuja (‘THA’) and the subsequent improvement in pricing and occupancy rate. The available support to Transcorp Hotels as a member of Transnational Corporation of Nigeria Plc (“Transcorp”), and the partnership with Hilton Worldwide Limited (“Hilton”) is considered positive rating.

    In the report released in August, this year, it stated:  “Following the upgrade at THA and the accompanying repricing of the hotel facilities in fiscal year 2018, revenue improved across all service lines, with rooms and food and beverages rising 26 per cent and 28 per cent. Per management, the company is  exploring other opportunities and add-on services that could be offered to boost earnings going forward.’’