NAMA Receives Spares to Support TRACON’S Operations

The Nigerian Airspace Management Agency (NAMA) has taken delivery of another consignment of
critical spare parts required for the continuous service and operation of the Total Radar Coverage of Nigeria (TRACON). the new arrival, again, reinforces confidence that the surveillance network is serviceable and all nine TRACON installations could be easily restored in case of downtime. the
consignment, which was cleared at the Apapa port in Lagos from  ales Group, in France include MES1 1400A power supply modules, control units and other critical units. Managing Director of NAMA, Capt.
Fola Akinkuotu, said the relationship between NAMA and the equipment manufacturer, Thales, had
never been frosty as some media reports would have it. “In fact, it has been very cordial and we are poised to continue to keep it that way. You will recall that we cleared some consignments of spare parts for TRACON last year from the same Thales,” Akinkuotu said. He disclosed that apart from the spares already received, another consignment of spares has landed Apapa port and was being cleared, while other consignments are already being shipped to Nigeria from France. He said payment had already
been made for ordered consignments.

The NAMA boss also revealed that as part of efforts to keep pace with global best practices, TRACON would in a few months’ time undergo a total reconditioning process that would ensure that the entire system attains the acceptable reliability level specified by the International Civil Aviation Organisation (ICAO). He described this process as “a sort of turnaround- maintenance”, which is to be carried out by the equipment manufacturer, Thales Group. Akinkuotu said the acquisition of spares for TRACON is in line with the agency’s decision to be proactive in maintaining the nation’s radar facility. “Availability of spares would ensure that parts of the radar equipment would be readily available whenever and wherever they are needed. There are some that would immediately be used for replacement while others will be kept in the warehouse pending when they will be needed and I can assure you that NAMA engineers have the capacity to undertake the maintenance of this facility as they have always done in the past,” Akinkuotu said.

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Nigeria, Others Spend $14 Billion Importing Pharmaceutical Products

Nigeria and other African countries currently spend at least $14 billion on importation of pharmaceutical products needed in the continent, owing to lack of capacity in local products, therefore exporting needed jobs to other countries, United Nation’s Economic Commission for Africa’s (ECA) Executive Secretary,
Vera Songwe, has said. Songwe said Africa should stop exporting much-needed jobs to other continents
and invest in its pharmaceutical industry, in particular, to provide for its people and create jobs for its unemployed youth. Speaking at the Africa Business Health Forum for 2019, Ms. Songwe in a statement, said Africa could create more than 16 million jobs if the public and private sectors collaborated and invested enough in the drugs industry. Africa, she said, currently imports $14 billion worth of its
pharmaceuticals from outside, a situation she said can be curtailed. “the health and wellness sector has the potential to create 16 million jobs. We should no longer export those jobs. We should bring back those jobs,” said Ms. Songwe. She continued:

“By 2030, an estimated 14 percent of all business opportunities in the health and well-being sector globally will be in Africa, second only to North America with 21 percent. this is a huge opportunity for the private sector.” Songwe urged governments on the continent to work with the private sector to ensure there’s access to health by all on the continent. “We know that a happy Africa is a productive Africa. We know that a healthy Africa is a prosperous Africa. that is the purpose of this forum – to say we should no longer be exporting those jobs,” the ECA Chief said. Africa’s business magnate, Aliko Dangote, in a message read on his behalf, said governments from both developed and developing countries were increasingly looking at public-private partnerships (PPPs) as a way to expand access to higher-quality health services by leveraging capital, managerial capacity, and know how from the private sector.

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Abuja Chamber Calls for Urgent Tax Reform to Grow SMEs

Abuja Chamber of Commerce and Industry (ACCI), has called for urgent tax reforms to safe Small and Medium Enterprises (SMEs) from demands for tax even before they begin to make profit. Mr Adetokunbo Kayode, President of the chambers made the call in a statement signed by Mr Gena Lubem, the Media and Strategy Officer of ACCI in Abuja on Monday. Kayode said that the practice of
mandatory requirement for tax clearance from companies newly registered was a disincentive for the growth and thriving of SMEs in the country. According to him, it is also one of the stumbling blocks in the Ease of Doing Business. While noting the ongoing progress in national tax reforms, he advised
tax authorities to immediately review the tax clearance system to reduce the burden placed on new companies sprouting up across the country.

The growth of Small, and Medium Enterprises depends very much on the enabling environment the government is able to create for them to grow. “their growth will in turn create jobs and collective wealth for the nation. All that is necessary must be done to nurture such new businesses. “New companies should not be mandated to produce tax clearance until after a year or so of operations,’’ he said. Kayode said that members of the chambers had also lamented the negative effect of that policy in their efforts to run their legitimate businesses. “SMEs must not be taxed on operations but on profit. Company’s duty is to pay tax on profit only if there is a profit. You are not to pay tax if you have not made profit or if you made a loss. “We want to see a situation where companies will be taxed on profit not on any other affiliation. “this means that a business must pay tax on the profit it has made over a period of time as stipulated by the appropriate law,’’ he said.

According to him, the situation on ground is where companies are whipped into paying all manner of taxes, levies and other forms of payments to the three tiers of government. “If this country must grow and have a vibrant economy, the plight of the SMEs must be adequately taken into account. “SMEs are of fundamental importance to us due to the meaningful contribution they add to economic development. “they are constantly expanding output, generating employment, and redistributing income, promoting indigenous entrepreneurship and greatly producing primary goods that strengthen industrial linkages. “the sector is accountable for about 85 per cent of the total industrial employment in the country and between 10 to 15 per cent of the total manufacturing output,’’ he said.

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Nigeria Signs Agreements with Afreximbank, NSIA, BoI to Develop Special Economic Zones

It’s a done deal: President Buhari meets Representatives of the DFIs providing funds for Nigeria’s Special Economic Zones. Nigeria’s Federal Government today signed investment agreements with
three Development Finance Institutions; Afreximbank, Bank of Industry and the Nigeria Sovereign
Investment Authority (NSIA) for the development of special economic zones in the country.And with the signing, President Muhammadu Buhari, who presided over the ceremony at the Council Chambers of the
Aso Rock Villa, declared the investment company in the special economic zones will become operational.
“Today, we are here to witness the signing of investment agreements, following which the Nigeria SEZ Investment Company Limited will become fully operational,” he said.

The Federal Government set up NSEZCO Limited as a vehicle for participating in Public-Private Partnerships involving Federal and State governments and local and foreign private investors to develop new Special Economic Zones all over the country, offering world class infrastructure and facilities at competitive costs. the projects in the pilot phase include Enyimba Economic City, Funtua Cotton Cluster and Lekki Model Industrial Park. the three DFIs are among the five to partner with NSEZCO and the Ministry of Finance Incorporated. NSEZCO intends to raise at least US$500million in equity over the first five years in order to execute its ambitious strategy of becoming a leading investor in special economic zones in the country. the other investment partners are African Development Bank (AfDB) and Africa Finance Corporation (AFC). Called Project MINE (Made in Nigeria for Exports) the development of special economic zones under the direct supervision of President Muhammudu Buhari, is a Presidential special priority intervention aimed using the zones to attract substantial foreign and domestic investment for the development of world-class facilities dedicated to export-oriented manufacturing in a range of industries across Nigeria.

Project MINE seeks to position Nigeria as the pre-eminent manufacturing hub in sub-Saharan Africa
and as a major exporter of made in Nigeria goods and services regionally and globally; as well as boosting manufacturing’s share of Gross Domestic Product to 20 per cent; generating $30bn in annual export earnings; and creating 1.5 million new jobs all by 2025. Speaking at the signing ceremony, President Buhari said the Federal Government set up the Nigeria SEZ Investment Company Limited as a
vehicle for participating in Public Private Partnerships involving Federal and State governments and local and foreign private investors to develop new Special Economic Zones all over the country. He said, the projects in the pilot phase include Enyimba Economic City, Funtua Cotton Cluster and Lekki Model Industrial Park.

The President said, the Federal Government is implementing a comprehensive plan including: “the invitation of experienced Special Economic Zone developers and operators to partner with us to upgrade the Federal Government owned Free Trade Zones in Calabar and Kano, to offer world class standards of
infrastructure and facilities. Whilst we await the completion of the process of bringing in these investors,
the Federal Executive Council has approved he award of contracts in excess of N19.45 billion for the needed investment in Calabar and Kano Free Trade Zones and work is currently ongoing. this is the highest amount of capital investment ever in the history of these zones. He said: “We have allocated
substantial funds to upgrade the capabilities of our people and the systems in the Nigeria Export Processing Zones Authority to strengthen it as a regulator of our Special Economic Zones; and “We
are allocating substantial resources to the provision of “outside the fence” infrastructure to ensure that
our Special Economic Zones are connected to global, regional and domestic markets.

“We are reviewing our incentive framework to ensure competitiveness relative to the other countries with whom we are in the race to attract export oriented global manufacturing investment.” He added that the Federal Government will extend the early successes achieved in Ease of Doing Business to the areas critical to globally competitive export-oriented manufacturing operations. He thanked the investment  partners for their “strong demonstrations of support for the important initiative.” Dr. Okechukwu Enelamah, whose ministry, Industry, Trade and Investment is implementing Project MINE, recalled President Buhari’s choice for special economic zones to hasten industrial development and the mandate to the ministry to attract investors to participate in the project. “this is the reason we are here today. the investors have all agreed to partner with us,” he confirmed. He said the initial projects such as the Enyimba Economic City are underway, while feasibility study is going on in eight states. the signing of the agreement was done by Professor Benedict Oramah, President of Afreximbank; My Kayode Pitan, Managing Director of Bank of Industry and Mr. Uche Orji, Managing Director of NSIA. Mr. Femi Edun, a director of NSEZCO and Dr Bakari Wadinga, Director, Ministry of Finance Incorporated, signed on behalf of the company.

Speaking separately, they all thanked the Federal Government for the opportunity to participate in the project and said they are happy to be partners because they believe in it and are confident of its success. Project MINE seeks to aid structural transformation of the Nigerian economy by increasing the manufacturing sector’s contribution to GDP to 20% by 2025; It also seeks to contribute to sustainable inclusive growth by creating 1.5 million new direct manufacturing jobs in the initial phase of Project MINE.  Other objectives are to Increase and diversify foreign exchange earnings to at least US$30bn annually by 2025, by increasing manufacturing sector exports; to Create local models of global best practice in provision of world class infrastructure at competitive costs connecting SEZs to international and regional markets with transport links, uninterrupted power, ICT, water, sewage and other services to ensure smooth and efficient operation of SEZ businesses to Promote the “cluster” effect to be gained by locating similar export-oriented manufacturing businesses within the same locality Attract world class investors with strong positions in global supply chains and investors with potential to increase the scale of operations rapidly to set up operations in SEZs; and Create an enabling environment for SEZ businesses by instituting best in class legal and regulatory frameworks, using technology and streamlined processes to facilitate movement of people, goods and capital and easy access to government services, approvals and permits.

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Dangote, UNECA launch Africa Business Health Forum in Addis Ababa

Ms Vera Songwe, executive secretary, UNECA, Didier Drogba and Halima Dangote with copies of an 89 page report on Healthcare and Economic Growth in Africa, launched Tuesday in Addis Ababa. NAN Photo By Mohammed Yusuf/Addis Ababa Ms Vera Songwe, the Executive Secretary, United Nations Economic Commission for Africa (UNECA), on Tuesday in Addis Ababa called for an improved Public Private Partnership (PPP) in financing Healthcare in Africa. Songwe made the call at the Africa Business Health Forum, organised by UNECA , Aliko Dangote Foundation and Aigboje Aig Imoukhuede’s GBCHealth. An 89-page study on Healthcare and Economic Growth in Africa, jointly sponsored by the trio was presented at the event. the forum also witnessed the launch of African Business Coalition for Health in Africa, a coalition of business leaders and philanthropists committed to a healthier business space and the environment.

Ethiopian Prime Minister, Mr Abiy Ahmed, Mr Ismail Guelleh, President of the Republic of Djibouti, Mr Aig Imoukuede, Co-chairman GBC Health were among dignitaries at the event. Aliko Dangote was represented by his daughter, Hajiya Halima. Halima Dangote speaks at the Africa Business Health Forum Songwe said PPP would play an important role in mobilizing additional forms of financing and closing the health infrastructure gap on the Continent. “In the last quarter of 2018, a trend was observed whereby multiple organisations developed tools to help public policy officials and the private sector made more informed decision on PPPs and standardize the process of applying best practices. She told the forum that she has noticed another trend where new organisations have emerged working towards good governance in infrastructure through PPP.

Songwe said Africa’s healthcare systems demand significant investments to meet the needs of the growing populations, changing patterns of diseases and to meet the internationally agreed development index. Speaking on behalf of her father, Mr Aliko Dangote, Chairman Dangote Group, Hajiya Halima Dangote, highlighted the vital relationship between health and economic growth and development in Africa. She said that health and economic development must go hand in hand as healthy populations live longer, and are more productive and would be able to save more and support the economy. Dangote said access to essential health services must be seen and considered as One of the most important aspects of development.

She said Africa’s target of healthy populations could be achieved through the PPPs. “Governments from both developed and developing countries are increasingly looking at public-private partnerships as a way to expand access to higher quality health services by leveraging capital, managerial capacity, and know how from the private sector’’ Dangote said. She said Aliko Dangote Foundation was committed to working with governments and key stakeholders for the development of impactful health initiative in Africa. “I believe that private sector leaders have a strong role to play. In the past, I have in my country charged business leaders to commit at least One per cent of their profit after tax to support the health sector’’, she explained. Mr Mitchel Sidibe, Executive Director, UN AIDS, said it was high time for both public and private sectors to work together to ensure improved health services delivery through various technologies available especially for those populations living in rural areas. Sidibe said healthcare delivery should be seen by both public and private institutions as a fundamental right to all human beings

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Nigeria Recovers N1.2tr Unpaid Oil debts, May Revoke Debtor Licencees

Nigeria’s Minister of State for Petroleum Resources, Dr. Emmanuel Kachikwu, disclosed that the Federal Government had recovered no less than N1.2 trillion in unpaid royalty from crude oil sales, following the Ministry’s automation initiatives.With some oil firms yet to remit their royalty to the Federal Government at the expiration of the statutory deadline, the Minister said such firms may lose their licences if they failed to make remittances within the extended timeline.

Having generated $1.5 billion from renewal of licences, Kachikwu said the Ministry is speeding up licensing procedure in Nigeria, by taking away the discretionary parameters of directors as well as creating a platform for the resolution of issues that may arise. Addressing journalists on the Crude Oil and LNG Tracking (COLT) and other automation initiatives embarked upon by the Ministry through the Department of Petroleum Resources (DPR), Kachikwu explained that the automation of many of the processes in the crude oil value chain has aided tracking of revenue by the government.

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Big Oil Companies Record Enormous Profits

The world’s top oil companies, the “supermajors” — US firms Chevron and ExxonMobil, Britain’s BP, Anglo-Dutch Royal Dutch Shell and Total of France – earned nearly $80 billion in net profits last year. They all boosted their bottom line, with some hitting levels not seen since a plunge in crude prices from their perch above $100 per barrel in 2014. they all reaped enormous profits, thanks to higher oil prices and keeping a tight lid on spending, even if that risked limiting their medium-term production capacity. Higher oil prices didn’t hurt, of course, although the fourth quarter was marked by strong volatility.Overall, the price of Brent crude was $71 per barrel last year, compared with $54 in 2017. But that’s not the whole story.

The super majors have also maintained the financial discipline — cost-cutting and reducing investments — that they adopted following the 2014 crash in crude prices. they tightened their belts enough to become profitable even when oil prices were low. And when crude prices rise again, their profits surge. “Total’s job is to be profitable and to lower the break-even point no matter what the price of oil is,” said chief executive Patrick Pouyanne this past week. “We’re going to maintain discipline, there’s volatility” in the market, he added. the roller coaster that crude prices have been on in recent months, due in large part to geopolitical uncertainty as the United States and China face of in trade dispute with major repercussions for the global economy, means that the supermajors can’t rest on their laurels. BP Chief Bob Dudley expects, like his fellow oil chiefs, oil prices “to remain volatile, with many uncertainties, including how markets respond to evolving sentiment around ongoing trade discussions” as well as a crisis situation in Venezuela.

The investments will thus remain limited. While investments in exploration and production rose seven percent last year to $382 billion, according to IFP Energies Nouvelles research group, they are still 40 percent below their 2014 peak. Moreover, they remain concentrated in North America where they are targeted at exploiting shale oil and gas.IFP Energies Nouvelles expects a modest increase of three to eight percent in investment spending this year. the oil services sector — made up of firms contracted to carry out lots of the exploration and production work — were hit hard as the supermajors cut back and tightened financial discipline. While the number of tenders for work has increased, the “market recovery is slow”, said Gael Bodenes, chief executive of Bourbon which offers marine services for off shore oil and gas projects.

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USSD Framework limits transfer funds to N100,000 daily

The Central Bank of Nigeria (CBN)’s new USSD framework stated thatthe daily limit of transfer of funds from mobile phones via short codes will be restricted to N100,000 a day, effective June 2018. In a circular released on Thursday, 26th April 2018, the Director, Banking and Payment System department of the CBN said that the decision was made because of the risks associated with financial transactions using USSD codes. What is USSD? Every Nigerian with a bank account has access to USSD (Unstructured Supplementary Service Data). It is pretty much a short code (differs per bank) that
allows customers check their account balance, purchase airtime, or pay for services, all on their phones by dialing. Bank accounts can be linked to a user’s phone number, allowing the user to make sim related transactions on the registered number without entering a bank.

Why is it problematic? “Most people password their phones but not sim cards. So, I take out the sim and
put it in my phone and get the last digits of the person’s BVN to make a transfer. I dial the short code for obtaining the BVN number of any user and then make a transfer all of the money in the user’s account to mine” One of the primary reasons why USSD is problematic is because of certain elementary risks
around it. Thieves can now exploit USSD to defraud Nigerians. Phones are now being stolen for their sim cards, which are usually connected to some bank accounts. If they figure out the bank a user makes use of, they can sometimes generate the Bank Verification Number (BVN) and use the mobile USSD of the bank to empty the account. CBN to the rescue…

“The vast applications of the USSD technology, in terms of available services have raised the issue of the risks inherent in the channel. In this regard, concerns have been expressed on the likely exposure of CBN approved entities to the possible breaching of the USSD accessed financial services in view of likely vulnerabilities in the technology and the ever growing threats” – CBN In order to lessen the risks mentioned above, the Central Bank starts by limiting the amount that can be transferred via USSD to N100,000 a day. The circular also points out that transactions over N20,000 will require a pin and a soft token. These restrictions are relevant because they mean that thieves who exploit these codes do not have full access to a user’s bank account. Although not a completely comprehensive solution, it is a step in the right direction.

In addition, banks are to allow customers who don’t want to make financial transactions using USSD the option of opting out of the service. This gives a consumer the option of managing how they want to carry out their transactions. Finally, the framework places emphasis on the need to protect the financial integrity of information through encryption. To this end, financial institutions providing the use of USSD channel have to ensure that the user receives notifications on the status of every transaction conducted.

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The Problem with Pensions in Nigeria

Nigerian pension funds have the opportunity to invest in infrastructure. Nigerian workers are not preparing for retirement. Of the 69 million people in the labour force, just 7 million have pension accounts. In the United States, more than half of the working age population have some form of retirement plan, and that number is over 70% in the United Kingdom. A pension plan is a retirement account whereemployers and employees make monthly contributions. In Nigeria, employers contribute 10% of the salary and the employee contributes 8% – this is known as a defined contribution scheme. The employee receives the money when she retires.

Previously, Nigeria operated a defined benefits system where the pension account was solely topped up by the employer, or the government in the case of the civil service. Although this meant that retirement benefits were part of the annual government budget, it was too expensive for employers to maintain. Hence the shift to a co-funded system. People have put forward many explanations for why Nigerians do not seem to be planning for retirement. Perhaps they don’t know they can get pension plans or do not want the money deducted from their salaries. Also, small businesses often believe they don't have to provide their employees with pension plans, but the law makes it mandatory if you have over 15 employees. But, more often, employers prefer not to accumulate the extra cost of putting a plan in place.There have been reports of private employers failing to remit their contributions to employee pension accounts, and the backlog makes it harder for them to pay.

Most are confident that they will not be penalized, even though the law stipulates a 2% penalty on unremitted funds. In recent times, the National Pension Commission (PenCom) has tried to penalize companies. In April 2018, reports suggested that employers were forced to pay N7 billion in penalties for deducting funds from employees’ salaries and not remitting them to their retirement accounts.This is a good start, but there are still a lot of organizations that are yet to remit their employees’ funds. The fact that only 10% of the working population have pension plans may leave the other 90% reliant on future generations or the government to take care of them when they are older.

Moreover, most pension account holders in the country are aged between 30 and 49. In a country where over half the population is below 30, you would expect that age group to account for more than 9% of pension accounts. Then again, we should not be surprised; Nigeria's youth unemployment rate is 25%, compared to the national average of 19%.

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CBN Not Controlling Interest Rate

The Central Bank of Nigeria (CBN) has said it does not control interest rate as claimed by some people. The bank explained yesterday that interest rate is determined by market forces. CBN’s director, Monetary Policy department, Mr Moses Tule said the focus of the apex is in three aspects: interest rate, inflation and exchange rate out of which he said the CBN concentrate on inflation, bringing down inflation and stabilizing the exchange rate. “The market determines what the exchange rate is, so it is not within the power of the CBN to control interest rate,” Tule said on the sidelines of the First Professor Uche Uwaleke colloquium as the first professor of capital market in Nigeria. The colloquium was tagged: “Fiscal and Monetary Policies for Deepening the Capital Market in Nigeria”.

He however acknowledged that “when we reduce the MPR, the way the micro economic fundamentals are today, you are going to have the impact of that in higher prices.” The convener, Professor Uwaleke said the conference was for economic and financial experts to rob minds on the challenges faced by the Nigerian Capital Market operators. The unsystematic risk is very high, Uwaleke remarked at the event which took place in Abuja, yesterday. Asked what can be done to improve the development of the Nigerian Capital Market, Tule advocated for structural and fiscal policies. He said structural policies will help to work on key issues in the economy including improvement in infrastructure. “There is also the urgent need to put in place and improve the issue of rule of law and contract within the systems if those issues are done and confidence built over time; certainly investment will come,” he said, adding: “On our own part, the CBN has tried to stabilize the exchange rate and you can see it has created a buffer – we have external reserve of $48billion.”

Uwaleke who said only about 166 companies are listed on the floor given her size as a country with the biggest economy in Africa with market capitalization of only N13.7trillion, said CBN can play the role of market maker of last resort for the market. His concern is that the market is tight to the apron string of foreign investors “Anytime the foreign investors cough, we catch cold. When they exit the market, we start having problems. If you observed the market did very well in January 2018, when we recorded as high as 16% in return but as we speak, all those gains have been eroded. Today, returns are in the negative territory and that can’t continue.” Former director-general of SEC, Dr Suleiman Danusa chaired the colloquium. He said: “I am happy that a colleague of mine has become a professor.’’ He also said that he looks forward to see the Nigerian universities have a department of capital market. He also want the nation’s universities have adjoin professorship of capital market.

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