FSDH raises shareholders’ dividend by 38.91% leverages technology for growth

FSDH Merchant Bank group, which marked seventh year of operating as a merchant bank this year,  has declared a total dividend of N3.07 billion to its shareholders for the financial year ended 31 December 2018.

This represents a 38.91 percent increase over the level of N2.21 billion it paid to the shareholders in the corresponding period of 2017. The amount translates to N1.10k per share as against N0.79k per share in 2017.

FSDH Group achieved a profit before tax (PBT) of N6.7 billion for the financial year ended 31 December 2018, representing an increase of 21.4 percent from the profit of N5.57 billion for the year ended 31 December 2017.

Profit after tax (PAT) attributable to the group increased by 13.2 percent to N5.37 billion from N4.74 billion for the previous year.

Earnings per share (EPS) for the group was 166 kobo, which was 2 kobo more than the 164 kobo earned in the previous financial year.

During the period under review, all its subsidiaries posted profits. Consequently, FSDH Asset Management (FSDH-AM) recorded a PAT of N326.87 million, while the PAT recorded by Pensions Alliance Limited (PAL) and FSDH Securities (FSDH-SEC) were N1.47 billion and N64.16 million respectively.

Speaking at the annual general meeting in Lagos, Femi Agbaje, Chairman, said, “We expect that the Nigerian economy will continue to recover in the short-to-medium term. The expected increase in activity in the Nigerian economy should offer growth opportunities for many sectors of the economy”.

Hamda Ambah, managing director/CEO of the bank, said the bank remains committed to fostering mutually beneficial relationships with our customers by providing tailored solutions that meet their specific needs.

“The FSDH Group will continue to work within a robust risk management framework leveraging on technology”, she said.  “By deploying technology, we will be able to further leverage same to bring funds cheaply and more like the commercial banks”.

“We will also continue to collaborate with like-minded partners to develop innovative financing and investment solutions which will enable us to exploit emerging opportunities and create shared prosperity in 2019”, she added.


Nigeria faces mixed oil market outcomes as China-US trade war intensifies

Concerns that the rising China-US trade dispute could slow the global economy and that US sanction on OPEC members, Iran and Venezuela, will further tighten the oil market present Nigeria with mixed fortunes.

Slower global economic growth as a fallout from the trade dispute between China and the United States of America means less demand for oil, because oil demand is a function of economic activities. Less demand for oil implies oil prices will start falling, which is some bad news for Nigeria. But a tightened oil market will further shore up prices, good news for Nigeria’s economy managers.

Brent crude oil futures were at $71.12 per barrel at 0710 GMT Tuesday, 12 cents, or 0.2 percent, below their last close. US West Texas Intermediate (WTI) crude futures were at $62.30 per barrel, 5 cents above their last settlement.

Nigeria, Africa’s biggest crude producer, is exposed either way to whatever happens at the international oil market because its economy is still heavily dependent on its petroleum sector. Oil still makes up 90 percent of foreign exchange and 80 percent of government revenue but contributes less than 10 percent of gross domestic product.

Against this backdrop, Oyindamola Adedokun, outcome lead, revenue stream at FOSTER, an Oxford Policy Management programme, says it is time to take out fuel subsidies and put a proper stabilisation mechanism in place as buffer.

“Nigeria’s revenue this year is going to fluctuate, given these two major factors in the global oil market,” Adedokun said. “We are just barely out of a recession and if nothing is done to fix the petroleum sector, Venezuela may be our destination.”
Maritime consultancy and shipbuilding tanker brokerage Eastport said in a note that “worsening trade friction between Washington and Beijing poses a downside risk” to its forecasts for petroleum products.

The US sanctions have already halved Iranian crude oil exports over the past year to below 1 million barrels per day (bpd), and shipments to customers are expected to drop to as low as 500,000 bpd in May as sanctions tighten.

Beyond Iran, Washington has also placed sanctions on the Venezuelan government under President Nicolas Maduro, disrupting supplies from the country, a founding member of the Organisation of the Petroleum Exporting Countries (OPEC).

“As sweet as Nigeria’s crudes are renowned to be globally, we have recently lost our most-valued customers and our gas buyers are themselves now competing with us in the same market space as suppliers,” Luqman Agboola, head of infrastructure at Sofidam Capital Limited, told us.

One of the assumptions undergirding Nigeria’s 2019 budget is crude oil estimate of $60 per barrel. But with Brent at $71 per barrel, Africa’s most populous economy has opportunity to save $10 on each barrel of oil sold. The catch, though, is that there is no constitutional backing to save money from sales of crude oil above the budget benchmark, which is supposed to go into the Excess Crude Account domiciled at the Central Bank of Nigeria.

“There is no legal backing for the excess crude account. The Constitution says revenue accruing to the Federation Account should be shared; there is no provision to save for future generations,” said Oby Ezekwesili, who was part of the economic team under former President Olusegun Obasanjo that proposed the establishment of ECA.

This means the economic wellbeing of Nigeria and its citizens remains significantly exposed to external shocks, driven by whichever direction oil prices go.


Why Nigeria must bridge infrastructural gaps to aid food production

As Nigeria makes efforts to ensure that agriculture plays a key role in its quest for revenue diversification, stakeholders in the sector have charged the Federal Government to bridge the infrastructural gaps to aid agribusiness development in the country and ensure food security.

Indubitably, some of the greatest problems confronting rural farmers and communities in Nigeria are the absence of critical infrastructure such as motorable roads, storage facilities and irrigation facilities amongst others.

Farmers continue to suffer low levels of agricultural productivity due to infrastructural deficit across the country, which reduces their profit and impact on their capacity to increase productivity.

The provision of critical infrastructure is a pre-requisite for enabling Nigeria stimulate economic growth and to reach the targets for economic diversification and food security.

Obiora Madu, former chairman, export group, Lagos Chamber of Commerce and Industry (LCCI), said that Nigeria does not have an effective agricultural infrastructures, stating that the country’s export drive can only be successful with adequate infrastructural facilities such as storage, good road networks amongst others. He added that the lack of these facilities has made cost of food production higher.

“The costs of logistics are also very high. It is cheaper to transport a commodity to Europe than to transport same commodity within the country,” Madu said.

After few days of heavy rainfalls most farming areas and markets become totally impassable and this has continued to impact negatively on the prices of food items across the country.

Samson Akwah, organising secretary-yam section, Mile 12 Market, in Lagos State said that the cost of transporting yam tubers using a Mercedes Benz truck (911) from the Middle Belt region to Lagos has increased from N350, 000 to N700, 000 due to the bad state of roads.

Although Nigeria ranks top in the production of some crops, the infrastructures needed to store the excesses are lacking.

“Post-harvest losses in Nigeria are huge due to inadequate storage facilities in the country,” said Mawuli Coffie, team leader, West Africa Food Markets Programme, adding that the country’s post-harvest losses are enough to feed the West Africa region.

According to Abiodun Olorundenro, manager, Aqua Shoots, the problem with Nigeria’s agriculture is infrastructure. He believes that that the country is growing enough food to feed its people, but notes that most of what is grown often rots in the field because it is difficult to move them easily from the farms and the facilities to store them are lacking.

“We can only feed ourselves when the infrastructures needed to boost productivity across the value chain are there. We can even move our foods from the farm to the market easily,” Olorundenro said.

He stated that developing agriculture is very critical in the country’s efforts to diversify the economy, which he said can only be achieved when heavy investments are made in infrastructures.

Investments in the country’s primary agricultural infrastructures will help integrate poorer sections of the population into a sustainable process of economic growth and development, experts say.

In turn, this will reduce poverty by providing jobs directly and indirectly that will serve as a stimulus to the economy and the agricultural sector specifically.

Nigeria’s population is fast rising and it’s growing at an annual rate of 3.1 percent, therefore the need to bridge infrastructural gaps is necessary for food security and economic growth.

Recently, the non-oil export has come under serious threat owing to the worsening state of the Apapa and Tin Can roads that lead to the nation’s Lagos sea ports.

As a result, agro commodities worth billions of naira are being trapped at the port as clearing processes are becoming difficult owing to the faulty Customs scanners.

Experts stressed that transaction cycles for export are taking longer than necessary and foreign buyers are beginning to question the integrity of contracts they enter into with Nigerians.

As a result, buyers are now shunning Nigeria’s cashew nuts at the international market as contractual agreements are being delayed.

The situation has resulted in a 60 percent drop in price from an average of N500,000 per ton in 2018 season to N 200,000 per metric ton in 2019 cashew season, its lowest since 2016.

“The situation has been bad for cashew exporters as buyers are refusing to renew contract agreements because of the port congestion and delay in clearing for export,” Zacheaus Egbewusi, chief executive officer, Agri-Commodities Inspection Limited, said in a telephone response to questions.

“It takes an average of 30 days for cashew to be cleared and shipped out of the ports currently.

“This has crashed the price of cashew to as low as N200, 000 per metric ton from N500,000 per ton of 2018 prices. This is the lowest we have sold since 2016,” Egbewusi said.

Source: By Josephine Okojie

Stakeholders worried over FG’s double standard in revoking oil licences

Recent revocation of six oil mining leases by the Federal Government for non-payment of royalties is not sitting well with some stakeholders who believe this is sending the wrong signal to investors and lacks transparency.

The Federal Government had reportedly revoked licences of six OMLs and one oil prospecting lease (OPL) in the onshore, shallow water and Deepwater Niger Delta basin over alleged non-payment of royalties.

BusinessDay learnt that the assets affected are OML 98 controlled by Pan Ocean, OMLs 120 and 121 held by Allied Energy, now Erin Energy (which is now bankrupt), OML 108 owned by Express Petroleum, OML 141 held by Emerald Resources, and OPL 206 held by Summit Oil International, a company founded by the late Moshood Abiola.

But some industry stakeholders are alleging double standards in the Federal Government’s action as it was said to have applied different and milder sanctions on other companies that committed the same offence. While the government revoked the licences of some companies, it was learnt that the government only seized the crude belonging to some other defaulters.

The stakeholders say the government action would send the wrong signal to prospective investors in the oil and gas sector as they might fear government severe sanctions at the slightest infraction.

“In terms of correctness, the government acted within the scope of the laws governing the petroleum sector and each breach has a corresponding penalty. Remember also that the minister possesses discretionary powers to revoke or withdraw oil licences,” said Ayodele Oni, energy partner at Bloomfield Law Practice.
“In terms of fairness, that is a different conversation. The government could have chosen to warn the companies or awarded fines for the default in royalty payments. There may be other political undertones but I leave that to political analysts,” Oni added.

Pan Ocean, Allied Energy, and Yinka Folawiyo were among companies listed inside the Nigeria Extractive Industries Transparency Initiative (NEITI) report as owing the Nigerian government some royalties in 2016.

NEITI specifically stated that Pan Ocean Oil Corporation (Nigeria) Limited failed to make any financial payments in 2016, despite being in Joint Venture (JV) arrangement with the federation.

“The non-payment by these companies will result in revenue loss to the federation. It is worthy to note that Pan Ocean did not make any financial payments in 2016, despite being in JV arrangement with the federation,” NEITI noted.

An industry source close to Pan Ocean Oil Corporation, however, told BusinessDay that a meeting has been slated for stakeholders to have discussion with Emmanuel Ibe Kachikwu, minister of State for Petroleum Resources, on the way out of this situation.

“As a matter of fact, representatives of the Federal Ministry of Petroleum Resources led by the Hon Minister of State for Petroleum Resources, Emmanuel Ibe Kachikwu, and Pan Ocean are currently engaging in high-level negotiations to resolve the issues of outstanding payment as well as related projects tied to the JV and other assets within the vicinity of OML 98,” the source said.

The source added that there are credible indications that Pan Ocean Oil Corporation (Pan Ocean) remains operator of OML 98 Joint Venture, contrary to previous information regarding revocation of seven licences including OML 98.
Similarly, a source in Emerald Energy Resource, who spoke to BusinessDay on condition of anonymity, said the company was not given any revocation letter. He explained that what happened was that there was a time lag in the payment of its royalties and that the money had already been paid to the Department of Petroleum Resources (DPR).

“The DPR had to write to the minister intimating him about our payment and everything was settled,” the source said, adding that the company had requested for a letter of good standing from DPR.

Source: By  Olusola Bello & Stephen Onyekwelu

Investors adopt risk-proofing measures after FX crisis

Nigeria’s first economic recession in 25 years, in the second quarter of 2016, caught several investors and consumers unprepared. The attendant foreign exchange (FX) crunch left many businesses gasping for breath.

“At times the only way to access FX was through the black market and this led to a tripling of costs in some cases,” a private equity investor told the Economist Intelligence Unit (EIU) in a new report on ‘FX and debt trends in five sub-Saharan Africa economies’ released Tuesday.

The report focused on Nigeria, Ethiopia, Kenya, Tanzania and Zambia.
The rising import prices in Nigeria reflected in higher costs to consumers and squeezed margins for local businesses.

Although there has been an improvement in the FX liquidity following the rising oil prices and the interventions by the Central Bank of Nigeria (CBN), the impact of the devaluation in 2016 and the consequent FX shortages on firms, banks and consumers is still being felt.

While some high-end consumers are forced to resort to the greenback as a hedge against inflation or currency devaluation, companies and investors on the other hand are trying to limit their risk exposure by diversifying their investment portfolio across sub-Saharan African regions.

Local businesses and investors spoken to by EIU gave insight into their risk-proofing strategies. They suggested developing conservative business plans, with ample levels of reserves. They also suggested that currency mismatches (for payments and revenue) should be avoided as far as possible, while mitigating risk by diversifying an investment portfolio geographically is worth considering.

Furthermore, interviewees pointed to the need to take opportunities for exits when they present themselves.

The interviews revealed that, facing FX restrictions, businesses resorted to unofficial channels. The situation also pushed for changes in business planning. Cash reserves became a necessity in such an environment.

“Companies can adjust to a devaluation by passing on some of the increase in costs to customers and accepting a squeeze on margins. But a lack of availability of FX makes life very difficult, even for a business like ours which is not particularly import-intensive,” said a private equity investor.

The foreign exchange turnover at the Nigerian Autonomous Foreign Exchange Fixing (NAFEX) stood at US$105.9 billion as of March 2019, with foreign portfolio investors (FPIs) accounting for over 60 percent.

The Central Bank of Nigeria (CBN) in April 2017 introduced the Investors’ and Exporters’ (I&E) window for portfolio investment flows, export earnings and trade-related payments such as loan repayments, dividends and interest payments.
“The retail sector has been badly hit. Consumer demand is taking time to recover from the downturn. Margins on imported goods have been squeezed as retailers have been unable to pass on fully to consumers increased costs from the devaluation. Also, some retailers’ rents, in malls, for example, are indexed to dollars,” a real estate investor told EIU.

Another private equity investor said Nigeria’s economy is extremely import-dependent. As a result, currency weakness has broad-based knock-on effects across the whole economy, as the increase in costs for imported staples, such as rice and sugar, squeeze the amount that households can spend on discretionary goods and services.

According to the National Bureau of Statistics (NBS), 5.32 billion litres of petrol were imported into the country in the fourth quarter of 2018.

The devaluation and shortages of FX highlighted the benefits from an operational point of view of matching currency costs with revenue.

Analysts suggest that wherever possible, firms and investors should borrow in the currency in which they earn.

The report, however, forecast that the managed float system introduced by the CBN will likely remain in place throughout 2019-22. It projected a likely devaluation later in 2019, particularly if oil prices fail to recover from the 20 percent decline suffered since the peak in September. If this happens, it would help to correct an overvaluation of the currency that has built up owing to persistently high inflation, the report said.

The CBN’s secondary market intervention sales (SMIS) amounted to US$4.2bn in Q1 2019. These sales are targeted at the real sector of the economy (including manufacturers, importers of raw materials and airlines), and totalled US$2.9bn in Q1.

The CBN recently introduced Chinese yuan interventions, which are mainly geared towards manufacturers and a total of CNY237.6m (US$34.9m) was injected into the market in Q1 2019, according to a recent report by FBNQuest.

Source: By 

Why minimum wage won’t task law firms, by lawyer

A Lagos lawyer Mr Charles Echefulachukwu has said most law firms will have no problem paying the new minimum wage.

According to him, while the minimum wage is not binding on every law firm, it is expected that no law firm should pay below it.

Echefulachukwu said most law firms already pay far above the minimum wage.

He, however, added that N30,000 should be the minimum standard salary for support staff of even smaller firms despite being exempt from the law.

“The new minimum wage law is very clear: every employer has to pay it. But there is a proviso: if you’re not employing up to 25 staff, you are exempted from the minimum wage.

“If a firm has up to 50 lawyers, the law says you must pay the minimum wage.

“But the minimum wage is N30,000. Several law firms in Lagos are already paying far beyond that.

“It should not be an issue in the legal profession,” he said.

Echefulachukwu spoke on the sidelines of a talkshow organised by the Insighful Ladies Forum of the Mercyseat Tabernacle International, Bariga, Lagos, of which he was a panelist.

The event, with the theme: My dream, had the panelists answer questions from women, men and youths on issues such as business, career, finance, marriage, among others.

On how youths can succeed, Echefulachukwu said there is no shortcut to hard work.

“Youth must development the quality of hardwork. They also need to begin to think about how they can contribute to national development from their little corners.

“Many tend to focus on what the state can provide, but there is little focus on impact-making.

“What can you do in your little corner? The development of this country cannot be driven by the government alone.

“Individually, we must contribute to drive the desired development that we need in this country.

“You have two people: the leadership and the followership. If the followership is not effective, the leadership will have a problem,” he said.

The lawyer urged youth to acquire leadership traits and exhibit them wherever we are, including by holding government accountable.

“That’s the best way to prepare for tomorrow,” he said.

Other panelists included financial experts, career woman and entrepreneurs, including Mrs Olushola Ngofa, Dr.Titi Fowokan, Alozie Louis, Enoh Ubona.

They spoke on the need to make sacrifices to make dreams a reality, but emphasised the need not to sacrifice principles in a bid to succeed at all cost.

Fowokan said: “You need sacrifice to succeed in life. No dream can be actualised without some form of sacrifice.”

She added: “Make up your mind to set a pace that is attractive. All you need is focus and hard work. Focus on making impact. Ask God to take you through the path of problem solving.”

Youths were also urged not focus on making money, but on making positive impact on others.

The married ones were encouraged to ensure that their dreams aligned with those of their spouses, all of which should be discussed before marriage.

Insightful Ladies Forum Founder Mrs Sandra Momah said the talkshow was organised to inspire women and youth.

“The objective of the Forum is to empower ladies to be leaders. This is the sixth edition. In empowering ladies we also need the men. We come up with topics that cut across both gender.

“Women need the support of men. We want to see women take their rightful place in life – in terms of career, marriage and in building the society.

“As women, we have a lot to offer the society, but sometimes because of the environment and the way we’re brought up, some ladies tend to sit at home.

“A woman’s vision should not just be to get married. You can give a lot to the family, community and society. We have a lot that we can offer,” she said.

Momah said the programme has inspired a lot of participants to pursue their dreams and realise them.

According to her, participants are assigned to mentors to help them succeed in their various endeavours.

Source: By Joseph Jibueze

Fuel subsidy removal will do Nigeria more harm than good – Expert

Mr. Tunde Olatunji, an expert in Development Economy and Finance, has urged the Federal Government not to remove fuel subsidy as suggested by the International Monetary Fund (IMF).

Olatunji, who is a member of the Osun House of Assembly, told the News Agency of Nigeria (NAN) in Osogbo on Tuesday that the removal of fuel subsidy would do more harm to the economy than good.

NAN recalls that the IMF said in April that with the low revenue mobilisation that existed in Nigeria in terms of tax to Gross Domestic Product, it would be good for the country to remove fuel subsidy.

Addressing a news conference at a joint annual spring meetings with the World Bank in Washington DC last month, the Managing Director of IMF, Christine Lagarde, said that by so doing, the country would be able to move funds into improving health, education, and infrastructure.

But Olatunji said that before the Federal Government could remove the subsidy, it should ensure that it strengthened the country’s refining capacity

“Nigeria should not talk about removing fuel subsidy now until we have another arrangement in place.

“Removing subsidy is not rocket science, but we must develop our local capacity for refining our products.

“Even if we are not exporting locally refined products, we can meet our domestic consumption needs and thereafter we can begin to plan on removing the subsidy.

“Any attempt to remove the fuel subsidy without any other arrangement in place, will be like ‘solving one problem by creating another’.

“If we take away fuel subsidy, the pump price will go up, which will have a ripple effect on all goods and services and at the end of the day people will begin to pay more,” he said.

Olatunji added that the advice offered by IMF might be because of corruption which has affected the economy through the subsidy before the advent of the President Muhammadu Buhari administration.

“Most countries in the world decide which commodity to subsidise.

“As a matter of fact, America as at today subsidises its agriculture products and I don’t think they are planning to take it away now.

“Subsidy is not a crime. As a matter of fact, it is an economic tool.

“It is when the subsidy regime gets abused and monies meant for it go into private pockets that it becomes an issue,” Olatunji said.

Source: By The Nation

How to make airports effective, by experts

Should the Federal Airports Authority of Nigeria (FAAN) be unbundled? Yes, say experts, who gathered at the Airport Business Summit and Expo Africa to examine the issue during a summit. Other options on the table are privatisation, commercialisation and concession, KELVIN OSA-OKUNBOR reports.

How to make airports effective and safe in Africa is becoming an interesting subject whenever experts and players gather to examine global trends in airport management.

International aviation bodies including: International Civil Aviation Organisation (ICAO), Airports Council International (ACI) and International Air Transport Organisation (IATA) say global attention has been on Africa and Nigeria in particular, because it is becoming an investments’ frontier.

With airports playing critical role in air transport infrastructure, especially by  attracting economic prosperity to their domains, a global campaign is ongoing by African governments to invest more in their airports.

To attract carriers, airports must be run effectively. They should charge minimum aeronautical charges in line with the global template.

Africa has 731 airports and 419 airlines in a global industry where aviation supports about seven million jobs, generating over $80billion economic activities.

It is for these reasons that experts continue to canvass models of running airport economies in Africa, insisting that players think out of the box to consider ways and means of steering the industry onto the path of growth.

To them, air transport services consolidation must be built on a strong base, utilising the best options to optimise both aeronautical and non-aeronautical revenue sources to propel growth.

Though consensus is building on the desirability of airports in every corner across Africa as economic enablers, the model to be adopted to run such social infrastructure has pitched experts against one another.

Are airports built for profits or mere catalysts to drive socio – economic activities?  Are they stand-alone social infrastructure or projects meant to grow the gross domestic product of the economies in their domain? Are airports run as private or public investments?

These are some of the issues on the table last week, when experts met at the Airport Business Summit and Expo Africa (ABSE) in Lagos to examine models for airports in the continent.

To them, the increase in Africa air traffic has been consistent with increase of passenger traffic growth rates of 6. 3 per cent between 2016 and 2017 and 9. 9 per cent between 2017 and 2018. According to Summit statistics, projected growth for passenger traffic in Africa is expected to continue through 2035 on the average of 4.3 per cent annually. The statistics said more people will travel in and out of Africa with inter-regional traffic expected to improve significantly.

Setting the tone for discussions, the organiser of the summit, Mr Fortune Idu, said ABSE as a multi-sector event drew participants from industries with direct and indirect dealings with airports in the value chain, not limited to airlines; retail; security; safety; technology, hotels and others.

He said the summit was critical as an important connector that will help airports’ operators make their cities and terminals attractive for airlines and investors by showcasing a one-stop information portal for passenger projections and facilities.

Idu said the summit created a platform to assist operators, investors and the airport business community to find a common ground for prosperity.

He said: “ The gap between operational cost of most regional airports and the revenue is very small, making the burden of concession and incentives huge. However, all other sub sectors within this chain look up to the airport to be the driving force for cost reduction, which will translate to a more affordable fare and increase in patronage. This expectation is real and the airport must address it by increasing its capacity to earn more and save more by providing efficient services management and operations.”

Models for running Airports in Nigeria

According to Idu, the current Federal Airports Authority of Nigeria (FAAN) structure  is too large to achieve efficient running of airports.

With over 26 airports under its management, FAAN, he said cannot deliver because it was handling more than what it has the capacity to undertake.

He canvassed FAAN’s unbundling into three entities, which he listed to include: Airport Development Authority; Airport Management Company and Federal Airports Property Company Limited.

Idu said such model was already in place in other countries, including South Africa, Ghana, Egypt and others in Africa.

The Airport Development Authority, Idu said, should have jurisdiction over security and airports’ regulation whereas the Airport Management Company should be strictly involved in the business of managing airports.

Such entity, which should strictly busy itself with management of airport terminals, could be ambitious enough to consider managing airports in other African countries.

The Federal Airports Property Company Limited, Idu said, should be saddled with managing all FAAN property.

Such body, he said, will have business with management all airport land and the criteria for lease by concessionaires and other investors around the airport. If achieved, this model he said, will bring about right-sizing of existing personnel for capacity.

A case for concession

Speaking at the event, aviation consultant , Mr Chris Aligbe said the way forward to effective management of airports remains their concession.

Aligbe said:”Government should consider airports concession option. Without exploring the option of concession, it could be difficult to expand the airports because of issues of resistance to change by aviation workers. In doing this, the government must consider how to address issues of labour .

Govt’s position

Minister of State, Aviation, Mr. Hadi Sirika, had consistently reminded aviation stakeholders that there was no going back on government‘s plan to concession major international airports in Lagos, Abuja, Port Harcourt  and  Kano.

He said the process for their concession had been concluded, but he failed to mention the international firms that won the bid to concession the terminals.

This development has continued to raise doubts among industry players and watchers.


The government, however, seemed to have contradicted itself when in one breath it said some airports have been concessioned, and it is still investing in their upgrade and expansion.

El- Mansur Atelier Group Chief Executive Officer, Tunde Oyekola, said despite the misgivings on how airports are managed, some state governments are not looking back in their bid to have airports in their domain as economic enablers.

He said increasing investments in airport terminals have made it difficult for the government to hand them over to private investors.

Case for route/airport development

A representative of Intels Group, Nuhu Adams, canvassed the setting up of route development department in FAAN.

According to him, there was need for airlines, banks and government agencies to collaborate to deepen air transportation.

He examined the role FAAN could play in deepening the process of  route development, adding that financial institutions could assist by developing funding models for airport infrastructure and other projects critical to aviation development.

He queried banks for not pushing for aviation project financing, observing that banks are running away from financing airlines because of low returns , poor corporate governance ethics and other infractions by owners and investors in that sub sector.

Idu said airports’ concession is the way to go if aviation workers could trust that it would not lead to job losses, adding that if the process was transparently carried out, it could lead to a win win situation for all players.

Besides unbundling the current airport authority, Idu said the way the government was investing more funds in aviation infrastructure, could be difficult, if the same government could give up the airports for concession.

Some experts argued that if airports are built as economic enablers, the whole idea of trying to make money out of them sounds may not be counter productive.

They cited how the Nnamdi Azikiwe International Airport has helped to open up the Federal Capital Territory in Abuja.

They made the case for states governments investment in airports to open their corridors to economic activity.

Cargo development option

An aviation consultant, Mr. Tayo Ojuri advocated the development of a comprehensive agro-air logistics policy to encourage investors in the air logistics business.

He said the opportunities that abounded in agro air logistics were not harnessed by stakeholders.

He observed that cargo airports must be properly developed with the requisite infrastructure to attract investors and most especially, the farmers in the agro commodities to grow the industry.

According to him, awareness creation was important for prospective investors, especially the farmers to know the benefits derivable from the business.

A case for ground handling

Skyways Aviation Handling Company ( SAHCO) Plc Managing Director, Mr Basil Agboarumi said effective airports remained the key for players in the ground handling value chain.

He said effectively run airports will serve as incentives for ground handling business, where operators do not need to bother about inadequate operating facilities.

The SAHCO boss said it was time Nigerian airports ran effectively without the authorities subjecting ground handling companies to multiple audits.

Besides the International Safety Ground Operations Audit ( ISAGO) carried out by IATA, operators Agboarumi said, are still subjected to other local audits by either FAAN or the Nigerian Civil Aviation Authority (NCAA).

He said whatever option in airport management adopted in Nigeria, issues related to high aeronautical charges, multiple airport taxes and inadequate facilities should be addressed. “We have to pay through our noses, most of the time we pay a lot to be in business. Everybody is collecting money from ground handling companies. I don’t want to go into controversy, but it has become so bad that before you can even sneeze around the airport, you must pay, everybody is squeezing, squeezing, that’s is a problem, that’s is a challenge,” he said.

He emphasised co-operation between ground handling and the airport authority, adding that updating of airports with the latest technology remains key.

“I believe that aviation today is about co-operation. Across the world, co-operation is the word and if we must have an industry with global standards, there must be co-operation. Cooperation  between ground handlers and other airport stakeholders,” Agboarumi said.


‘Manufacturers’ confidence in economy dwindling

At 51.3 points, being the outcome of the first quarter (Q1) Composite Manufacturers’ CEO’s Confidence (MCCI) index, the confidence level of CEOs in the sector, though not negative, is dwindling, as performances of some sectors and industrial zones fell short of the 50 points benchmark, latest data from the Manufacturers Association of Nigeria (MAN), has shown.Indeed, seven out of the 13 industrial zones in the country recorded indexes below 50 points, while seven out of the 10 sectoral groups recorded 50 points and below under the latest survey.

Specifically, industrial zones within Imo/Abia, Edo/Delta, Kaduna, Apapa, Anambra/Enugu, Bauchi/Benue/Plateau, and Abuja performed below the 50 points benchmark, with some going as low at 35 points.

To MAN, the MCCI result for Q1 2019, standing at 51.3 points, clearly depicts a manufacturing sector that is slightly above the minimum threshold, adding that an aggregate or composite MCCI above 50 points signifies that the manufacturing sector is still struggling, as operators have seemingly low confidence level but high expectation that manufacturing performance will improve.

MCCI of 50 points shows that the sector is stagnant; below 50 points signifies that manufacturers are losing confidence on the economy, and that the performance of sub-sectoral groups is retracting.

With manufacturers having to contend with too many challenges that limit their competitiveness, operators in the sector decried the poor electricity supply to industrial firms, over regulation, multiple taxes and levies, poor accessibility to ports/high demurrages, poor economic infrastructure, difficulty in sourcing foreign exchange, low patronage, and counterfeiting/influx of substandard goods.

MAN President, Ahmed Mansur, explained that the newly-created MCCI report revealed that the manufacturing sector was struggling as operating conditions remained challenging.


Mansur said the Association would no doubt continue to promote a friendlier operating system for the manufacturing sector in Nigeria, to remain global and stay competitive.

According to him, the MCCI is an integral part of the four-year transformation roadmap of the association. This index is a strategic effort to proactively review the impact of government policies on the manufacturing sector, with a view to using the evidence-based feedback to advocate for a specific direction of government policy formulation and implementation, he added.

Speaking further, he said the maiden edition was a statistical indicator created to measure the pulse of the manufacturing sector by sampling the perception of business operators, using CEOs of MAN member-companies across 10 sectoral groups and 14 industrial zones as respondents.

”The index essentially gauges manufacturers’ perception using a set of diffusion factors, macroeconomic conditions and business operating environment indicators.

“The diffusion indicators include business condition, employment condition (rate of employment), production level, level of confidence on the performance of the manufacturing sector and expectations for the next three months.

“Specifically, the general macroeconomic indicators assessed include foreign exchange, lending rate, credit to the manufacturing sector and capital expenditure of the government while the business operating environment condition was measured by the intensity of regulation, multiple taxes/levies, access to seaports, local raw-materials sourcing and government patronage of Made in Nigeria manufactured products,” he said.

He said the fact that operators were struggling signified the minimal impact of regulatory reforms and macroeconomic policies on the performance of the sector.

He further revealed that the MAN sectoral group and industrial zones on the MCCI for the quarter turned out to be a mixed bag.

Dangote has invested more in Nigerian universities than any individual – FG

The Federal Government has revealed that the N1.2 billion hostel donated by the Aliko Dangote Foundation to Ahmadu Bello University, Zaria is the single largest donation by an individual in the history of universities in Nigeria.

Abubakar Adamu Rasheed, executive secretary, National Universities Commission (NUC), who represented President Muhammadu Buhari at the commissioning of the Aliko Dangote Hall, extended the Federal Government’s appreciation to the president of the Dangote Group.

“You have done what no other Nigerian has done since 1948 when the first university was founded. This is the single largest intervention by any individual in any university in this country in the 70-year history of our university. So, I congratulate Alhaji Aliko Dangote,” he said.

A visibly elated governor of Kaduna State, Nasir Ahmad el-Rufai, who is also an alumnus of the university, hailed Dangote for the giant project.

He described Dangote’s generosity as unprecedented, especially his support for education.
Speaking, Ibrahim Garba, vice chancellor of the university, said Dangote would forever remain dear to Ahmadu Bello University.

“The student population of ABU is over 50,000, made up of about 35,000 undergraduates and about 15,000 postgraduates. Every year, 11,500 undergraduates and about 6,000 postgraduates are admitted while about 6,000 undergraduates and 3,000 postgraduates respectively graduate. In any one academic year, we are only able to accommodate about 13,000 students on our two campuses,” Garba said.

“We are happy that Dangote has fulfilled the pledge he made in 2016 to build 10 blocks of hostels for Ahmadu Bello University’s students to improve their living condition. We may accommodate six students per room. This will certainly go a long way in ameliorating the accommodation scarcity bedevilling the university,” he said.

He thanked Dangote for his intervention, as well as members of the Aliko Dangote Foundation and the entire Dangote family.

“This is unprecedented for us. We can’t ask for anything more except if he thinks of anything he wants to add on his own volition,” Garba said.

Dangote, who also bagged an Honorary Doctorate Degree, said about his motivation, “If there are two things that I am passionate about, they are education and entrepreneurship. I believe they go hand-in-hand.”

He said it was this philosophy that led to the creation of the Dangote Academy in 2010 where about 1,000 graduates have been absorbed after their training.

He said he hopes students who stay in the Aliko Dangote Hall will follow his entrepreneurial footsteps and become future Aliko Dangote.

“When I came here as a guest speaker in 2016, the vice-chancellor told me that they have needs for accommodation; in fact, the last accommodation they had was 37 years ago as at then,” he said.

“It is not good for us to leave a university like this without accommodation. Really, our intention was to accommodate the female students, not boys. However, I still plead with the vice-chancellor to leave it for the female folk,” he added.

Muhammad Aminu Sambo, director, physical planning and municipal services of the university, said, “This is a big relief because the university has limited accommodation in relation to the numbers of students admitted every year. Accommodation is one of our nightmares.”

Speaking to newsmen, Sambo said of the over 50,000 students admitted yearly, the university could only provide accommodation for about 13,000.

He commended Dangote and urged all able Nigerians to emulate him and intervene in the educational sector.
Yabani Abubakar, chief architect of the university, described the hostel as a monumental intervention, urging others to emulate Dangote.

The 57-year-old ivory tower is sitting on 7,000 hectares with 82 academic departments, 13 faculties, and 12 research institutes

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