Director General, Securities and Exchange Commission (SEC), Munir Gwarzo, said the capital market, the institution he superintends, is in the forefront of getting the Nigerian economy out of recession. In this interview with ABDULWAHAB ISA, he also speaks on the unclaimed dividends saga and recent labour crisis that engulfed the agency, among other financial issues. Excerpts
As an integral member of immediate past management before you were elevated to the Director-General of SEC, what were the challenges then?
The responsibility before SEC and the market has grown bigger as well. It means that, the oversight responsibility of SEC has also grown. Like every organisation, SEC also has its own internal issues that it inherited from previous administration.
In the last two years, we’ve had a lot of engagements in terms of addressing those issues. It’s being a challenging time. It’s interesting to say that I have also enjoyed excellent support from the staffers.
No administration can achieve any progress unless you receive the support of staff. Nobody expect you to get 100 per cent support of the entire staff, but once I have 70 per cent supports, it’s enough for me to get the right momentum to move forward. However, that does not mean the 30 per cent will be laid back.
As far I’m concerned, my responsibility is for the entire 100 per cent. But once I’m able to have 70 per cent that shares my aspiration and vision and give the right support, it strengthens my resolve to continue what I have being doing.
So, it’s being quite challenging, it’s being quite difficult but, like I said, God has always been on our side. The market, government and staff have been quite supportive.
The capital market, just like the other sectors of the economy, has felt the effects of recession. What is SEC doing to address investors’ apathy?
After that crash, a lot of investors went out of the market, particularly retail investors. Some sold their houses to invest in capital market, some sold their vehicles, some sold their cows to invest in the capital market.
It has been a very bitter experience. But people need to understand that the capital market is a market where there will certainly be such developments – sometime it goes up, sometimes it goes down.
Even the most developed market in the world goes through that peak period and our market is not an exception. What we have being doing? We tried as much as possible to bring back domestic investors.
For institutional investors, we are happy that the National Pension Commission (PeCom) has been very supportive in terms of coming up with favourable guidelines for people to invest in the market.
Though, we have not being able to enjoy the kind of investments that the market expects from the Pension Funds Administrators (PFA). Money market rate gives between 17 and 18 per cent interests.
If you look at the treasury bills and the Federal Government’s bonds, it certainly discourages any institutional investor to invest in that equity market. That aspect significantly affects the propensity of institutional investors to patronise the market.
But we’ve been engaging them, especially now that the economy is recovering. We expect inflation to go down further. From last data, we saw it slightly dropped, which I think will favour the capital market.
From retail investor’s side, our approach since we came on board is completely different from what others have been doing. We try to look at what sort of issues retail investors complained about.
An investor will tell you that anytime he invests in the capital market, anytime dividend is being paid, he or she does not collect dividend. That is why we have being at the vanguard of propagating the e- dividend mandate.
We also get complain from retail investors who gave their shares to be sold and those shares had been sold but there are delays in the remittance of net proceeds. Sometime the complaint centres on total failure of remittance.
That is why we introduced Direct Cash Settlement, which allows the Central Security Clearing System that once those shares are sold, the net proceeds should now be credited directly to the client’s account.
We are making a lot of progress. This is the step we are taking in terms of bringing back domestic investors from the retail side and institutional side.
Poor enforcement of corporate governance code is responsible for half of fraud-related issues in the market. What is SEC doing to ensure strict adherence to code of corporate governance?
We’ve been doing quite well in that regard. We launched the code late 2015, precisely, in November 2015. Nigeria is the first regulator in Africa to come up with code of corporate governance scorecard where all quoted companies are expected to file in their scorecard and present their status of compliance with code of governance to the public.
In the last six months we have been running training programmes in conjunction with International Finance Corporation (IFC). They have been very supportive in terms of working with us to come up with the template for the scorecard and also training our staff.
We are almost through with quoted companies; we are also extending code of corporate governance to all the capital market operators. One of the things we have done in the last couple of years is to ensure that every capital market operator registered with SEC must have a compliance officer.
It wasn’t there in the past. Part of the responsibilities of the compliance officer is to check some of these corporate governance abuses so that he can now raise a flag.
If the management is not able to address it, the compliance officer has the cover of the SEC, given the provision in our law of whistle blowing, to extend it to the Economic and Financial Crimes Commission (EFCC) and other law enforcement agencies.
I think we’ve being doing quite well; we also came up with very robust capitalisation requirement where we expect companies to comply. We are also coming up with certain manual, like risk-based supervision, which, apart from looking at the financial standing of those companies, the template will also look at the level of their governance.
With that, I think in the next one or two years, we expect to see high level of compliance in terms of corporate governance from the capital market operators.
Is there a role capital market could play in aiding the recovery of the Nigerian economy?
I think the capital market has a pivotal role to play. When you are in a recession, you need a lot of investments. It’s the investment that will create the necessary growth. It’s when you have that growth that employment generation and citizens will now earn income.
The more citizens earn income, the more they will have more purchasing power, which will now encourage companies to produce more and the economy will continue to grow. There will be stability in terms of economic growth.
The best way to do it is on medium to long term. Capital market provides that window. For Instance, if you want to invest in infrastructure, this will require buying of materials, employment of people and the best platform to issue those instruments is actually the Nigeria capital market.
We’ve been engaging the Federal Government and working so hard to come up with favourable rules and regulations that will assist some of those investments.
We also have a role to play in terms of small and medium enterprises (SMEs). On infrastructure side, we are talking with Guaranco and Infracredit so that they can provide the necessary guarantee.
Investment in infrastructure is one of the riskiest areas of investment. For anybody to be comfortable to invest in those areas, the areas needed to be de-risked so that the level of risk investors will put in is less. Part of ways and means of de-risking an area is by providing a guarantee.
We are discussing with Guaranco and Infracredit to come to the country and provide some of the guarantees that will create a lot of activities in infrastructure.
We are talking with them to see ways and means they can extend such guarantee to SMEs because everywhere in the world, SMEs are the largest employers of labour. We need to extend the growth and development of our SMEs.
Most of them are not in the best of conditions. By the time the Guaranco and Infracredit are able to see the need to extend such credit to SMEs, it would help a lot. We are also discussing with private and equity funds and venture capital so that they can identify some of these SMEs that require funding.
They can enter those companies and provide them assistance they need so that those companies can be restructured and put in to operational level. We believe that the recovery programme of government will easily be achieved.
We are also looking at agriculture side, which is also in line with government policy. We believe that the best way to address agriculture is to have a thriving commodity exchange.
With a commodity exchange, a farmer will be able to get a better price for his goods and ensure price recovery. We are happy that the Nigerian Sovereign Investment Authority (NSIA) has agreed to invest in the Nigeria Commodity Exchange (NCX).
The intention is, once they invest and restructure the company, it will be easy for any investor to come in. We also encourage the establishment of AFEX, which is a private commodity exchange. We believe the role we’ve been playing in commodity exchange will certainly complement government’s effort in reviving the economy.
What is the state of unclaimed dividends and progress made in respect of National Investors’ Trust Fund?
From records we received from the Registrars as of end of last February, the total unclaimed dividends is about N117 billion. Currently, our staffers are with Registrars to actually verify this claim. We are also pushing for the establishment of National Investors’ Trust Fund to address some of the complaints of unclaimed dividend.
The reason for establishing it is, first, we don’t think the provision in Company and Allied Matters Act (CAMA) that states that any dividend that is more than 12 years become status bar.
It only states status bar, it didn’t state where those monies would be reverted. Secondly; there is no country in the world that has a law saying after 12 years you cannot claim your dividend.
We believe that after 13/14 years once someone can come with genuine documents to proof that he/she is the genuine owner of that document or is a beneficiary of that dividend, we believe that person should be able to own and claim those dividends. So, the whole thrust about unclaimed dividend trust fund, is first to ensure there is transparency.
You can clearly see how much of dividend declared has been moved into the trust fund. Secondly, is for market to also enjoy the liquidity. As it is now, based on the provisions of the law, once any dividend has been declared and has not been claimed after 15 months, the law says it should be reverted to the company.
The law also went on to say that the company should now invest the dividend outside its business and when it is 15, 12 years, it becomes status bar. Like I said, the law didn’t say where that dividend should be reverted.
With the trust fund, the moment it is 15 months of payment, it should go to that trust fund. Let me clarify that the trust fund is not going to be managed by SEC. It’s not a SEC trust fund, but strictly a market wide trust fund and that is why we had presentation from SEC, Ministry of Finance, from shareholders associations and from other stakeholders’ groups.
It’s a market-wide trust fund and it is going to have fund managers whose responsibilities are to manage the fund; it will have trustees and is going to have a secretariat that will administer the fund. However, the fund will register with SEC.
SEC recently swooped on some firms and sealed them, what were their offences?
We want to ensure that any service you are going to produce in this market, you must do it within the confines of the law. So, if its capital market activities you are doing, you must register with SEC, if it is banking related activities, you must have approval from the Central Bank of Nigeria (CBN); if it is insurance, go get registration with the National Insurance Commission (NAICOM).
The hallmark of our regulation is to ensure things are done properly. Those guys were basically doing funds management business because; they were collecting money from investors and investing the money. If you are doing fund management business, the law mandates you to receive the approval of SEC.
What is compliance level to e-dividend registration?
We are happy that people are getting their accrued dividends once they have registered. On the average, we have between 7.5 to eight million investors in Nigeria. As of today, only about 1.7 million have registered for the e-dividend.
A lot, almost six million are yet to register. Recently, we uploaded on our website, list of people that have not provided their account numbers and we are calling people to visit our website and check if their names have appeared so that they can approach their Registrars to register for the e-dividend.
The e-dividend is a major game changer in this market. The era of warrant being posted to your postal box is no longer fashionable. A lot of people hardly collect their dividend and these huge accumulated dividends are the problem of unclaimed dividend.
It’s a function of people not picking up their dividend warrant either because they have changed their address or the amount of transport they are going to pay to collect the dividend is far above the amount contained in the dividend.
If it is going to cost you N2,000 to collect dividend warrant and another N2,000 go to bank and pay, that is N 4,000 and you will return home, it will cost you another N4,000 making N8000. You only have dividend of N3000 to collect.
It does not make sense using N8,000 to collect dividend of N3,000. So, we want to address that. That is why we are calling Nigerians to register with e-dividend.
There appears a frosty relationship between the SEC management and leadership of its in-house union. What was respon- As of today, only about 1.7 million have registered for the e- dividend. Almost six million are yet to register sible for this?
SEC has never had union in its history. I think the Commission started having union in 2012, almost five years ago. They joined an umbrella called Amalgamated Union of Public Corporations, Civil Service Technical and Employees Recreational Services (AUPCTRE), an umbrella meant to provide membership for clerks, cleaners and drivers.
They had a running battle with my predecessor, the former DG. When we came on board as commissioners for two years, we knew there had been a lot of issues. For instance, when we came on board, there were backlog of promotions that had not been done. Within three months, we conducted two promotions, which has never happened in the history of the Commission.
Given our limited resources, we did the promotion. Secondly, we even paid arrears for those promotions and those are optional things. There is nowhere it’s made compulsory you must pay arrears when you’re promoted, but we paid arrears. Three, we met a system where by medical services – check-ups were limited only to senior managers cadre and above.
But when we came on board, we say sickness has no level. Sickness is not only limited to DG, senior managers, principal managers and other top officers. So we extended it to every staff. .
Also, we looked at some items such as lunch, education allowance, which increased by 100 per cent even though the institution was going through difficult times financially, but we feel we need to motivate staff, we increased it.
We looked at contribution to the pension fund. We believed that when you are working in an organisation and you retire, you should be able to enjoy some level of comfort.
There is a provision in pension Act that says if a staff is willing and ready to increase his/her contributions up to 20 per cent, the organisation should also be able to do that. And we sent memo to say we are ready to increase it up to 20 per cent for anybody that wants to do that.
The increase to 20 per cent is a cost to the organisation. Most organisations stopped at 15 per cent, but we said anybody that is ready to go to maximum bar of 20 per cent, we are ready to support it and we extended it.
We didn’t stop at that. We set up a clinic within the Commission for the first time in the history of SEC. And we have a medical doctor that comes in every Wednesday to attend to staff.
We have a consultant, family physician that comes once in two weeks and we have a permanent nurse that comes in Monday to Friday. We had one or two staff that went through difficult times, they were dismissed, people made appeal and we looked at the appeal; they tendered an undertaken and we brought them back.
All staff-related issues we have addressed. I challenge anybody to fault these provisions I listed. But the argument is, because you are a union person you think you can do something and go scot-free, we say no.
You are first and foremost, a staff of the organisation and you are bound with staff manual of that organisation. You are actually a member of union of the organisation by virtue of being a staff of the organisation.
If you were not a staff you can’t be a member of the union. My argument has been, if you are a union official your conduct should be more than ordinary staff member because you are holding that position in trust on behalf of every staff.
So, your activities should be exemplary, your conduct should be above board. You cannot arrogate certain powers to yourself, thinking that whatever management wants to do they need to consult you.
BPE revenue generation base hits N150 bn
The Director-General, Bureau of Public Enterprise (BPE), Mr Alex Okoh, yesterday disclosed that the agency’s revenue generation base for the Federal Government was N150 billion at current quarter.
Okoh disclosed this at the National Assembly complex, Abuja, during a meeting with members of Senate Committee on Privatisation.
He stated this while responding to questions from members of the committee on the operations of BPE, saying that the current revenue base was achieved following recent sale of some power assets belonging to the Federal Government.
He listed the assets to include Afam Power Plant, Yola DisCo and government’s share in Geregu Power Plant Plc.
According to him, N105 billion was realised from the sale of Afam, N19.7 billion from the re-privatisation of Yola DisCo.
He said N14 billion was also raised from the sale of additional 25 per cent government share of Geregu power plant, noting that BPE was consistently generating N200 billion yearly for government.
However, he expressed concerns that BPE get a paltery N2 billion allocation for the 2020 fiscal year.
“It is out of place that as an agency of government that consistently generates N200 billion every year for government, only has N2billion as budgetary allocation.
“From the allocation N1.5billion is for personal expenses, which is paid directly through IPPIS to the various staff for their salaries and emolument.
“Then N500 million, that is meant to be for overheads and capital projects, we have never had good released up to 15 per cent to us, it is like bringing out water out of the rock.
“That is not the faith of similar revenue generation agencies, so we will need the support of the committee to help look at the funding framework of BPE, it is not encouraging and not sustainable.’’
Okoh stated that out of the 600 businesses that were previously owned by government, the ones that are still under the management of government were not performing creditably.
He identified the challenge of budgetary provision as major issue confronting the BPE.
“Another challenge is the resistance from Ministries, Departments and Agencies (MDA) that we supervise; they find it very difficult and reluctant to release these enterprises for privatising or commercialization for some obvious reasons.
He said that there were some bills awaiting passage in the National Assembly, noting the passage of the bills would help the bureau’s sectoral reform activity.
Climate change: IMF proposes green energy infrastructure
To mitigate the effect of climate change in Africa, the International Monetary Fund (IMF) has urged Nigeria and other countries in the continent to adopt a mixed approach to infrastructure projects.
Speaking yesterday during a press conference on Global Fiscal Monitor at the on-going World Bank/IMF annual meetings in Washington DC, the Deputy Director of the Fund’s Fiscal Affairs Department, Paolo Mauro, said African countries must choose the type of infrastructure that will have implications for decades.
According to him, with the number in the Fiscal Monitor, insinuations that emissions into the ozone layer are largely coming from Africa may not be right.
He said: “The African continent is very exposed to the effects of climate change. On the other hand, it is not yet a contributor. When you look at some of the numbers in Fiscal Monitor, the emissions are not really coming much from Africa. That may be the case later on in this century, but not yet.
“There are important decisions to be made today for which kinds of infrastructure is the continent going to choose. And decisions that are made today will have implications for decades to come.
“So, it is important that as African countries choose the mix of infrastructure projects, they choose green types of energy and in the transportation area, again, they can maybe choose rail as opposed to roads.”
On revenue from natural resources, the IMF said global prices of oil, gas and others had major implications for whether some countries are able to develop new fields, adding that future revenues are impacted by the developments of global prices in oil.
Population growth as panacea for development
The two-day economic summit of the Nigerian Economic Summit Group (NESG), the annual policy dialogue between private sector players and public officials, ended last week in Abuja where stakeholders expressed concern about the looming 400 million Nigeria’s populations by 2050 and how to convert same into asset, Abdulwahab Isa recounts
The year 2050 is 31 years away from 2019. Between now and then, experts predict that Nigeria’s burgeoning population could hit about 400 million; making it the third most populous country after China and India.
Huge population isn’t entirely a disadvantage. Like a coin with two split sides, huge population could be an asset to a country that guarantees quality education to her citizens, give premium attention to improved infrastructure such as good road network, uninterrupted power; improved health services and every item that scales up citizens’ living standard.
Regrettably, Nigeria is off these marks. Blessed with a huge population, Nigeria ranks among poor nations when measured by indices of a developed nation.
Lately, anticipated population size of about 400 million by 2050 has opened a fresh chapter, with experts projecting that an additional 200 million population will deepen an already sinking poverty level. A population of 400 million size is a huge liability, which requires earnest work to avert its crippling effects.
To give up portends massive economic disaster lurking to happen. The Nigerian Economic Summit 2019 edition organized by Nigerian Economic Summit Group (NESG) was conceptualised to lay the foundation for tackling socio- economic dislocations for 31 years journey into 2050.
The 2019 policy dialogue between private and public sector, themed: “NES 2019: “Shifting Gears,” examined in details, every sector with a view to diagnosing what ails it, challenges that stifle its growth while experts espouse solutions to fix them.
Bumpy road to 2050
NESG has kept faith with the policy dialogue for unbroken 25 years. Beneath the silver jubilee celebration package that the 2019 edition represented, the session unearthed the rough road Nigeria is primed to get to 2050 destination point.
NESG Chairman, Mr. Asue A.Ighodalo, in his opening remarks at NES 2019, explicitly painted a rough, long road to 2050 characterized with series of layers.
According to him, “aside the global shifts that demand our attention, our country is also changing internally. Despite rising poverty rates, our population growth continues at a trajectory that should be cause for concern and decisive policy measures. United Nations projection that Nigeria’s population will double by the Year 2050 to 410 million, and we will become the third most populous nation in the world behind China and India. Basically, the population is projected to grow by a little over three per cent per annum. If true and it does not seem unrealistic, GDP must grow by at least that much, year on year, for us to just maintain our current GDP per capita – this is without accounting for inflation. Clearly, we do not have that luxury.
“Our current GDP per capita, even at zero inflation, on its own, and more so when we factor in wealth distribution disparities, is not a metric we can afford to have stand still. We at the NESG are convinced that only consistent and inclusive economic growth, underpinned by a competitive, private sector-led, productive economy can move us toward real progress. By 2050, majority of the country’s projected 400+ million people will be under the age of 35.
“We therefore need to confront our realities and craft a new national agenda that will proactively and urgently drive inclusive double-digit growth and development, over the next three decades. It sounds daunting, but it is not impossible. It has been done before; by others in situations similar to ours, but never by accident.”
All the participants, including Nigeria’s President Muhammadu Buhari, who for the first time, discountenanced other official matters to attend NES 25, admitted the road to 2050 was bumby. He, nonetheless, assured that Nigeria coulds navigate through 2050 murky waters given her human resources.
On the focus of this year’s economic summit, which is discussing what Nigeria would be in the year 2050 when many studies estimate the country’s population will rise to over 400 million people, the President said: “As a government, our view is to equip our citizens with the means to seize any opportunities that may arise. This means we continue investments in education, healthcare, infrastructure, security and strengthen and entrench the rule of law.’’
Taming population size, prioritising girl child education
Some of the panelists included Founder of the Kukah Centre, Bishop Mathew Kukah, Emir of Kano, Mohammadu Sanusi (II), Governor of Ekiti State, Dr. Kayode Fayemi, and CEO, Jumia Nigeria, Mrs. Juliet Anammah.
These eminent Nigerians x- rayed complexity of Nigeria coping in the event of anticipated 400 million population size, and the vital role an affordable quality education, with emphasis on girl child education could have on reducing poverty rate.
Emir of Kano, Mohammadu Sanusi (II) punctuated a notion that Nigeria’s huge population is asset. He said, it was a liability, and pegged the bad vices ravaging the country to huge, uneducated population.
“The huge population is clearly a liability. All the issues you have, Boko- Harram, drug addiction, youth unemployment, kidnapping all tied to huge population. People say that our population is an asset but we are yet to get there. Nigeria’s population is currently a liability because most of the root cause of problems such as kidnapping, armed robberies, Boko Haram, drug addiction are all tied to the population that we have and the question is how you turn that into a productive one.
“This population problem is perhaps the most important developmental challenge we have to face. If we don’t have a demographic transition, we will never have economic transition,” he said.
The former CBN governor said girl child education should be given priority, saying “if we don’t give them good, quality education, it will be a huge crisis for us. Some people are deluded with hope. It’s time to move from hope to reality.”
Father Kukah aligned his position with the former CBN governor, saying population growth of other countries afforded them the opportunity to boost economic output.
According to him, “everything that becomes an opportunity in other countries is a liability to Nigeria. I don’t want to speculate how other nations have turned population into positive. Is either that there is something in Nigerian that makes it impossible for us, the lack of capacity and the sense of opportunities.”
For Anammah, she identified access to quality education as key to managing huge population for productive economy.
“We need policies that support micro industries. We have millions of people that are under employed today. How do we tackle it?”
Providing unemployed youths with enabled internet smart phone, she opined is one infrastructure that could take millions out of unemployment.
Also contributing, Fayemi noted that states were not in charge of their education curriculum, a development he said made states handicap in the area of developing suitable curriculum.
Creating an enabling environment for industries to thrive is the surest way to grow the economy, and get majority of Nigerians employed.
President of Dangote Group, Aliko Dangote, represented at the summit by Executive Director, Government and Stakeholder Relations, Ahmed Mansur, put this point forward at the first plenary session titled: “Competing with Giants.”
Mansur said private sector was key to the much touted industrial revolution, adding that his conglomerate was leading Nigeria into a new epoch through massive investment in the manufacturing sector and skill development.
Chairman of the Economic Advisory Council, Dr Doyin Salami, admonished Federal Government to get out of business and allow the private sector drive it. He also said that since the Federal Government was wooing the private sector to take risks and invest in the economy, it must be willing to mitigate the risks businesses face.
Chairman of First Bank Plc, Mrs Ibukun Awosika, said an emergency on the education sector must be declared, stressing that more than 70 per cent of Nigerian students were studying courses they are not interested in but are forced on them.
As with NES tradition, NESG recommendations, outcome of dialogue will be presented to the president via established channel, usually through the Minister of Finance.
The onus lies on Federal Government to take the recommendations seriously by committing them into policies for implementation. The earlier the government officials start by taking measures that will shift gears for a smooth ride to 2050 destination the better it will be for all.
Giving force to Nigeria’s data protection regulation
Nigeria recently took a cue from the European GDPR by coming up with a data protection regulation. However, while the GDPR is a law binding on all handlers of European citizens’ data, Nigeria’s remains a regulation, which enforcement is at the discretion of the country’s ICT regulatory agency. SAMSON AKINTARO reports
Prior to its recent red flag against mobile app platform, Truecaller, Nigeria’s ICT regulator, National Information Technology Development Agency (NITDA) had said it was investigating some banks and telecommunications operators in the country over possibility of flouting its data protection rule.
This was the regulator’s attempt to warn data handlers in the country that it was no longer business as usual as the country now has data protection regulation.
The NDPR was introduced in January this year to address the lacuna that existed in the country regarding data protection. While the National Data Protection Regulation (NDPR) is fashioned after the European General Data Protection Regulation (GDPR), stakeholders are worried that Nigeria may not achieve much with the regulation except with dogged enforcement.
Key Provisions of NDPR
The regulation, which is binding on all entities handling Nigerians’ data “provides that personal data shall be collected and processed in accordance with specific, legitimate and lawful purpose consented to by the Data Subject.”
Article of the regulation mandates the data controller to expressly inform the Data Subject of the purpose(s) of the processing for which the Personal Data are intended as well as the legal basis for the processing. Data controllers are also expected to collect the minimum required data and avoid unnecessary surplus age. “Data that is not useful for the Controller ought not to be collected. No data shall be obtained except the specific purpose of collection is made known to the Data Subject. This principle relates also to the principle on purpose of collection.”
On enforcement, the NDPR classified Controllers into large and small categories. Those who process data of more than 10,000 data subjects are liable to forfeit two per cent of their Annual Gross Revenue (AGR) while those handling less than 10,000, would lose up to one per cent of their AGR.
With the regulation coming into force April 2019, NITDA had on two occasions raised the alarm over some organisations’ non-compliance. While there is yet no sanction against any organisation for breach, the agency had threatened punitive measures, noting that some organisations were already under investigation.
Earlier in August, the agency said it was investigating some telecom operators, banks and fintech operators over allegation of breach of the country’s data protection regulation. The Director General of NITDA, Dr. Isa Pantami, in a statement, said some of the organisations under investigations have been reported to be violating the rule. Aside the private operators, the DG said the agency was also investigating the Nigeria Immigration Service (NIS) for alleged violation of the NDPR.
NITDA said it also discovered that there were over seven million Nigerians who are active users of the service, hence the need to enlighten the need to look deeper into the app and enlighten public on some of the areas of non-compliance as well as guide those affected.
NITDA, in a statement signed by its Director General, Kashifu Inuwa, said the caller-identification service was putting “many Nigerians in unsavoury conditions.’’
He said contrary to the expectation of many users, the Truecaller service collected far more information than it needs to provide its primary service.
The EU General Data Protection Regulation (GDPR) came into force on Friday 25 May 2018 and it has been described as the toughest data protection regime in the world as enforcements kick-started immediately. Late last year, authorities in Portugal issued a €400,000 fine to a hospital for failure to apply appropriate access controls over digital patient data. One of the most interesting aspects of this particular case is that no breach of data occurred. It indicates that corporations of all sizes, across the EU and in other jurisdictions, should expect a rise in regulator activity from a variety of catalysts, not just breaches.
In another GDPR enforcement, the UK Information Commissioner’s Office (ICO) demanded that a Canadian-based organisation “cease processing any personal data of UK or EU citizens obtained from UK political organisations or otherwise for the purposes of data analytics, political campaigning or any other advertising purposes,” or else face significant financial penalties. That enforcement validated the expectation of many experts that data protection authorities will indeed pursue any company in violation of GDPR regardless of whether or not they are based in Europe.
Major breaches of the GDPR can lead to fines of €20 million or four per cent of the infringer’s global turnover, whichever is the higher. Major breaches include failures to respect the rights of data subjects (such as the right to erase data), failures to process on the basis of the one of the permitted grounds, failures to apply the prescribed procedures for special categories of data (e.g. health or genetic data), or transferring data outside the EEA without lawful process. “Less significant breaches” can lead to fines of €10 million or two per cent of the infringer’s global turnover, whichever is the higher.
Need for law
Before the introduction of NDPR this year, NITDA had introduced Data Protection Guidelines in 2017 as a way of protecting the citizens’ data. Obviously, failure of that regulatory guideline to address the issue led to the release of NDPR, a replicate of Europe’s GDPR.
To avoid same fate befalling NDPR, industry analysts said the country would need to give data protection force of law by signing the Data Protection Bill 2010, which has been pending before the National Assembly, into law. The bill sponsored by a former Speaker of the House of Representatives, Hon. Yakubu Dogara, seeks to protect parties in regard to publication of market survey details and information, ensure that unauthorised processing of personal information is reduced, and use of personal data and information without the prior consent of the data is subjected to scrutiny.
Passage of the bill into law is expected to bolster the objectives of the NDPR and help in enforcement of the regulation.
The introduction of the regulation, no doubt, ushered in a new era of data management in the country; however, to achieve success in the regard, enforcement must be taken seriously.
According to stakeholders, if the regulation is duly enforced and complied with, it will be in substantial compliance with the GDPR and may provide more comfort to Nigerian entities doing business in the EU or with EU entities.
Fake phones: NCC to hire consultant for DMS solution
The Nigerian Communications Commission stepped up its efforts to tackle the issue of fake phones through the use of technology. To this end, the telecoms regulator said it was set to hire a consulting firm to act as transaction advisor in the deals that would deliver a centralised Device Management System (DMS).
NCC said it would deploy the DMS through public private partnership (PPP) arrangement, whereby the procured private party is expected to provide end-to-end solution, with a cost recovery-based registration fee charged in Naira per device, for a determined period by both parties.
The role of the transaction advisor to be appointed, according to the Commission, is to develop a bankable DMS PPP Project and successfully move the transaction to market and reach financial close.
In a notice on its website, NCC said the advisor is to, among others, “provide full technical, managerial and financial advice to NCC on the proposed PPP project; assist in designing work-plans, timetables and technical support during the PPP procurement process; provide input in the conduct of the PPP procurement process for selection of the PPP Partner/Concessionaire for the DMS project; and provide market trends that will confirm decisions on scope, structuring, and timing of the transaction.”
The consultant is also expected to “provide duly required technical advice and any other assistance that will ensure a smooth conduct of negotiations with one or more parties that will lead to a quick actualisation of a robust PPP Agreement/network of relevant Agreements for the proposed PPP DMS project.”
Worried by the influx of substandard phones into the country, the Executive Vice Chairman of the Commission, Prof Umar Danbatta, had recently announced plans to deploy technology solution.
According to him, the proposed DMS will have the capacity to facilitate the mandatory registration of all SIM-based devices in Nigeria, block all stolen, counterfeit, illegal or otherwise substandard SIM-based devices from operators’ networks and interface with Nigeria Customs Service, tax authorities, security agencies, Standards Organisations of Nigeria and other relevant agencies to ensure the full registration, payment of duties and taxes due on those devices and the protection of security and privacy of users in Nigeria.
To arrive at the decision, the EVC said several consultative forums had been held with the identified stakeholders.
Explaining how the system would work to detect cloned or fake phones, Danbatta said all mobile devices had IMEI, which are allocated by the GSMA. He added the DMS would be connected to the GSMA database for easy detection of devices with fake IMEI once they are connected to any of the networks in the country
While noting that counterfeiting is a global problem, which Nigeria is not insulated from, the EVC said the challenges posed by the menace were quite devastating as it has been hindering the progress made so far in ICT usage and processes in terms of its economic, social, environmental and security impacts on the country.
“The unchecked import and use of unregistered, cloned, substandard, counterfeit, stolen and or non-compliant devices pose a considerable threat to Quality of Service (QoS) and Experience (QoE), security, amongst others in Nigeria,” he said.
He said the increasing cybercrime, evasion of taxes, terrorism and health and safety concerns raised by the use of stolen, counterfeit and substandard devices in Nigeria are of serious concern to the regulator, hence the deployment of technology.
Through the provisions of the Nigerian Communications Act 2003, NCC is mandated to establish and enforce standards for all telecommunications equipment in operation in the country to ensure that they operate seamlessly and safely within the Nigerian telecommunications environment. Mobile manufacturers that want to sell in the country are expected to first apply with the regulator for the type-approval, which is granted after the device has been tested.
However, despite the regulation, thousands of mobile phones still find their way into the market without approval.
Border closure: Agonies of manufacturers, exporters
Recently, local manufacturers and exporters under the auspices of Manufacturers Association of Nigeria Export Promotion Group (MANEG) held its second annual general meeting (AGM) in Lagos where issues on border closure and other constraints were raised. Taiwo Hassan reports
In reality, the recent pronouncement by the Nigeria Customs Service that it is raking N5 billion daily from land border closure still sounds somehow before local manufacturers/exporters amid the challenges and negative impact the development is currently having on their business bottom line and investment in general.
However, government has repeatedly stated that the border closure was more of security concern following influx of illegal weapons, ammunition and smuggled rice via the country’s land borders.
Ironically, even before government took the decision, members of the organised private sector had called on it to intervene in smuggling of fake and counterfeit goods coming into the country, saying that the trend was severely affecting their businesses.
Speaking at the MANEG AGM, the association’s president, Chief Ede Dafinone, explained that its members were facing difficulties in their export businesses since government announced the closure.
Dafinone noted that members were already counting huge losses as exporters no longer meet up with their production outputs.
He, however, maintained that MANEG wanted the Federal Government to reopen land borders with immediate effect following its negative consequence on the economy, especially the manufacturing sector.
“MANEG and MAN will continue to make representation to the Federal Government that there must be a time frame where we know that the borders can be opened for business because our members are losing significant revenues in this period. They will still be servicing loans and taking on board overhead cost this time that cannot be recovered.
“You may also be getting pressure from your customers for not complying with the delivery contracts order you have made. I say all these to enhance the points we have made and put it in perspective of those who are not aware so that the public, government, and agencies of government will be aware of the sufferings of the exporters through this border closure.”
Also speaking, the representative of Aarti Steel (Nigeria) Limited, Imokhai Ehimigbai, carpeted the Federal Government for the sudden announcement of border closure without prior notice to MAN and other private sector groups in the country.
He explained that the border closure announcement was counter-productive and inimical to genuine exporters of goods in the country, frowning that many of them were facing severe difficulties in their export business.
According to him, the border closure has put genuine exporters on the edge as the lull business has affected their bottom line.
Ehimigbai said: “We were not informed about the border closure by the Federal Government, especially the Nigeria Customs Service as manufacturers and exporters that it would take place at such period, and till today, the borders are still closed. Many trucks are hanging there as at now, can you imagine if you are paying demurrage on your goods meant for export for over a month now what will be the cost today? I don’t know if there is any way MANEG can step into this matter for those of us doing proper business so that we can be allowed to carry out our genuine businesses at the Seme border and other borders.”
The steel exporter noted further: “If I tell you that am not feeling the heat I will be telling you lie. I had an order from my client in Ghana to supply steels and then on getting to the border, we met it closed. Imagine there was no prior information to that effect. I had six trucks; four going to Ghana and two for Benin Republic hoping that it would be shut for a short period.
“After about a week, I have to recall these goods back to the factory, it was a big loss on the company’s side having paid for six trucks we could not recover the money. You have loaded and one week they got to the border one week they returned. Demurrage was paid money was spent so it was a very big loss to the company.”
Speaking on preference for land borders by some exporters, Ehimigbai noted that many local exporters had abandoned the ports because of the lingering gridlock, which is fuelling high cost of transportating goods meant for export to the port.
Recounting Apapa congestion experience, he said: “Until today, the orders are there from our foreign clients in neighbouring countries but we cannot export, we cannot meet the order from our own point because the borders still remain closed. And if you decided to export by sea, the problem we are facing in Apapa is another one. Do you know that to take out a truck out of the Apapa port is a hell.
“For instance, I have zinc ice going to Mombasa port in Kenya, this order was made in March this year, the products were available in factory but I could not export until May because of the congestion on the Apapa end of Lagos. I even faced query from Colbert because I opened my NSP as far back as March when the orders were made but did not export until May. They were asking me for the delays I have to do a letter explaining why the delay came up.
“We all know the problems we face at the Apapa end of Lagos, getting empty containers out of the ports is a problem, returning containers with products to the port is another problem and we decided to go by roads and the borders are closed.”
The MANEG president stressed that it had been difficult for the association’s members as Apapa gridlock continues to linger.
MANEG stressed that the border closure was having serious multiplier effects on Federal Government’s revenue as well because a lot of money is being lost in the process.
Firm rues dearth of road infrastructure
The Board of Chemstar Group has said the deplorable road infrastructure across the country is a major crisis confronting paints industry, saying the poor situation of highways has continued to pose greater challenge and difficulty to the industry.
This board called on federal and state government to fix major highways in the country to easy the problems facing paints companies while transporting their products to the customers.
It also advised that government look at other areas, such as security, import tariff and electricity that have significant impacts on the real sector of the economy.
Chemstar Group is the owner of Chemstar Paints Nigeria Limited, manufacturer of Finecoat and Shield Paints, and its other subsidiaries.
According to the board, like other sectors of the economy, Nigeria paint industry has also been adversely affected by the economic condition in the country.
It added: “Construction activities in the country have been at the low ebb; property development is also at its lowest pace; while the construction sector is not growing at the pace it has been growing in the past four or five years, and the lull in the property business has also affected the paints business.”
2020: FG earmarks N103m for broadband plan, RoW
The Federal Government is to spend a total of N103 million on the implementation of National Broadband Plan and harmonisation of Right of Way charges next year. This was part of the N5 billion proposed for capital projects in 2020 by the Ministry of Communications.
According to the 2020 budget proposal, N72.1 million is to be spent on “implementation of national broadband plan,” while N30.9 million is to be spent on “implementation of the decision of government on the harmonisation of right of way (row) charges.”
For 2019, N138.8 million was proposed by the executive to be spent on implementation of the broadband plan, even though last NBP expired in 2018. This was, however, reduced to N74.9 million by the National Assembly. Similarly, for Right of Way harmonisation, N80.9 million was proposed but the lawmakers approved N76.8 million
Nigeria’s National Broadband Plan (NBP 2013-2018), which is government’s policy direction to achieve ubiquitous broadband in the country, came to a close in December last year and a new plan is yet to be released almost one year after. Indeed, as at the time of filing this report, the government is yet to set up a committee to draft a new plan as being clamoured for by telecom operators.
The immediate past Minister of Communications, Mr. Adebayo Shittu, had promised to set up a committee for another broadband plan before the end of 2018, but could not do so until he left office in May this year. Worried by the delay, telecom operators have called on the new Minister of Communications, Dr. Isa Ibrahim Pantami, to set up a committee to that effect.
The committee, according to them, is expected to come up with a new plan to drive 70 per cent broadband penetration in the next five years as proposed by the Association of Telecommunications Companies of Nigeria (ATCON).
The Director, Public Affairs at NCC, Dr. Henry Nkemadu, also recently noted that Nigeria was due for another national broadband roadmap. He, however, said government was yet to set up another broadband committee that would drive the process.
“As a regulator, NCC was part of the broadband committee for 2013-2018 and it will always be a member of such committee, but we have to wait for the appointment of a new committee to begin the process of achieving the proposed 70 per cent broadband penetration by ATCON in 2024,” Nkemadu said.
Stressing the importance of a broadband plan for Nigeria, President of ATCON, Mr. Olusola Teniola, said the country was able to attain and surpass the 30 per cent broadband target in 2018 because there was a roadmap.
According to him, “the general Nigerian economy is currently struggling between one and two per cent growth in Gross Domestic Product (GDP), but by the time we attain the proposed 70 per cent broadband penetration level by 2024, Nigerian GDP will reach 9.6 per cent, which is high in global ranking.”
On Right of Way charges, which is seen as one of the major hindrances against operators’ efforts at deploying broadband infrastructure, the Federal Executive Council (FEC) had in 2017 resolved to harmonise the various charges across states, to ensure that it is same nationwide. The FEC recommended a uniform charge of N145 per metre to lay fibre cable anywhere in the country. However, until this month, telecom operators said states are still charging as high as N6000 per meter for Right of Way.
According to operators, states have arbitrarily fixed their own charges which range between N1, 500 and N6, 000. While states like Rivers and Abia charge N1,500 and N2,000 respectively, others like Lagos, Delta and Ogun charge up to N5,840, N4,600 and N6,500 respectively.
In total, the Federal Government had budgeted N172.4 million for the harmonisation of RoW charges between 2018 and 2019. Analysis of 2018 budget showed that N95.6 million was approved for this purpose, while in 2019, N76.8 million was approved to implement the government’s decision. If the N30.9 million proposed for 2020 is approved, the government would have spent N203.3 million on harmonisation of RoW charges in three years.
MDXi wins Datacloud Africa Leadership awards
MainOne’s data centre company, MDXi, came out tops at the 2019 edition of Datacloud Africa Leadership Summit and Awards held in Ghana. The company was awarded the “Excellence in Data Centre: Africa” as well as “Africa Cloud Service Provider of the Year.”
According to the organisers of the awards, the awardees were selected by an independent panel of global data centre experts recognised for being world-class data centre and connectivity providers and innovators.
“The highly competitive ‘Excellence in Data Center’ award, honours companies known for excellence in providing regional collocation services in Africa, focusing on the data centres that combine best practice in data centre management and infrastructure, with efficient technologies that lend towards the optimization and security of critical resources,” the organisers said.
Reputed as the largest purpose-built commercial data centre in West Africa, MDXi was recognised for its world-class data centre infrastructure designed with a strong focus on high availability, security, and open access connectivity and operational excellence.
Expressing his pleasure at receiving the awards, General Manager, MDXi, Gbenga Adegbiji, said: “We are immensely appreciative of the recognition by the international community for the role we play in the West African digital ecosystem and we reaffirm our unwavering commitment to continued service excellence, by providing reliable collocation and cloud solutions.
“The data center business is about giving our customers peace of mind to run their businesses from wherever they may be, and we do not take the responsibility lightly. We have just launched our Abidjan Data Centre and announced our Appolonia (Accra) Data Centre where we plan to bring our operational expertise and processes to ensure the highest quality standards are put in place for customers in those markets. We are firmly looking forward to serving more businesses as the region continues to grow its digital economy.”
Bells’ students develop software to computerise hospitals
A team of 19 students of Bells University of Technology were recently mentored by leading US-based international IT company, New Horizons, to develop a high-end hospital management application to solve university-wide medical need.
According to the school’s management, the development has further advanced the capability of Nigerian universities to be the provider of much needed IT solutions, which can bail the country out of dependence on oil economy and near-total reliance on foreign technology experts to solve critical societal issues.
At the commissioning event on the university campus, it was revealed that the students successfully developed a digital solution named Bells Hospital Management System (BHMS) that completely digitalises the university’s medical/hospital system through a project platform named “Bells/New Horizons TECH HUB.’’
According to the project’s team leaders, the technology hub was established as the project-based component of the high-end deliverable emanating from the partnership between the university and New Horizons organisation.
The university management led by the Vice Chancellor, Professor Jeremiah Ojediran, was visibly impressed based on the fact that the project team consists of students from diverse disciplines, which include Atewogbola Yanmife – 400L Computer Engineering, Adetipe Kehinde – 300L Accounting , Oyienloba Joel -200L Computer Science, Umeh Tobenna -200L Computer Engineering, Adedigba Mololuwa- 300L Accounting , Ushie Joan – 400L Electrical Engineering, Uko Akanowo- 300L Computer Science, Kevin Obaro – 300LComputer Science, Noiki Tomiwa – 400L Electrical Engineering, Oladele Seyi -300L Computer Science, Odusami Olatunde- 300L Computer Science, Yusuf Halimat -300L Mechatronics.
The rest are Arogundade Rahmat -300L Mechatronics, Jibueze Anthony – 300L Computer Science, Oguh Kelechi -400L Electrical Engineering, Makanjuola Eniola -400L Architecture, Onatoyinbo Timileyin -300L Civil Engineering, Ogunseye Abiodun- 300L Accounting , Echefu Louis- 400L Mechatronics.
Professor Ojediran appreciated New Horizons management for mentoring the students from the scratch up to the development of the hospital solution.
According to him, various supports from New Horizons, which include periodic free ICT training for staff, media promotion of Bells University brand, prizes at convocation event, among others, have shown that the partnership with New Horizons is a viable one.
The Managing Director/CEO of New Horizons, Mr Tim Akano, who led the company’s team, commended the project team for having teachable spirit and being fast learners.
Akano charged the students on three main takeaways. Firstly, he said the students should have the mentality that they are not too young to be successful and that they should learn from internationally successful technopreneurs like Bill Gates, Mark Zuckerberg of Facebook, Dell, etc that started their researches and exploits as very young undergraduates.
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