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KEDCO appoints head of corporate communication



Kano Electricity Distribution Company (KEDCO) has appointed Ibrahim Shawai as its new head of corporate communication.
The company said in a statement that the appointment was part of its plans to rebrand the image of the company.

Shawai is a member of Nigerian Institute of Public Relations and Advertising Practitioners Council of Nigeria.

In letter signed by the Managing Director of the company, Jamilu Gwamna, the new head of the corporate communications unit was asked to map out strategies to reshape the image and identity of the company.

Shawai obtained a degree in Mass Communication from Bayero University, Kano and a master degree in international affairs and diplomacy from the Ahmadu Bello University, Zaria.

Also, he was trained at the DW Radio Academy, Germany, where he obtained an International Certificate for Journalism (ICJ) in 2002.


Prior to his appointment, Shawai has served in the following capacities: senior special assistant to the Kano State Government on Societal Re-orientation Programme, Gombe State correspondent, News Agency of Nigeria (NAN); information officer, Kano State Ministry of Information; news editor, programme producer/presenter; DW Radio Bonn, Germany; senior manager, National Identity Management Commission (NIMC); executive assistant, Dantata Foods and Allied Products Limited andmedia consultant with Compass Media and Communication Consult.

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Oil prices surge after attack on Saudi facilities




Oil prices surge after attack on Saudi facilities

Oil prices surged on Monday after two attacks on Saudi Arabian facilities on Saturday knocked out more than 5% of global supply.

Brent crude jumped 10% to $66.28 a barrel, while West Texas Intermediate rose 8.9% to $59.75 in Asian trading.

Prices pulled back slightly after US President Donald Trump authorised the release of US reserves.

The strike, which the US blames on Iran, has sparked fears of increased risk to energy supplies in the region.

The drone attacks on plants in the heartland of Saudi Arabia’s oil industry included hitting the world’s biggest petroleum-processing facility.

It could take weeks before the facilities are fully back on line. State oil giant Saudi Aramco said the attacks cut output by 5.7 million barrels per day.

Jeffrey Halley, senior market analyst at Oanda said the price spike across oil markets was a reaction to the “political and geopolitical implications” of the attacks.

“The bigger issue is just how secure is Saudi’s infrastructure from attacks?,” Mr Halley said.

US Secretary of State Mike Pompeo said Tehran was behind the attacks. Iran accused the US of “deceit.”

Later Mr Trump said in a tweet the US knew who the culprit was and was “locked and loaded” but waiting to hear from the Saudis about how they wanted to proceed.

The Saudis have not gone into any detail about the attacks, barring saying there were no casualties, but have given a few more indications about oil production.

Energy Minister Prince Abdulaziz bin Salman said some of the fall in production would be made up by tapping huge storage facilities, reports the BBC.

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Analysts back planned introduction of 10-year naira futures



Analysts back planned introduction of 10-year naira futures


The measure is aimed at easing pressure on naira



he reported plan by the Central Bank of Nigeria (CBN) and the FMDQ OTC Securities Exchange to consider introducing between 5-year and 10-year naira futures contract as part of efforts to ease pressure on the local currency and boost investor confidence has received the support of analysts at CSL Research.



In a note obtained by New Telegraph at the weekend, the analysts said: “The foreign-currency futures contracts was introduced by the Central Bank in 2017, and was recently extended to a maximum duration of 13 months. The introduction of the futures contracts helped to attract investment to the treasury bills market as investors are able to hedge against fluctuations in the Naira for the duration of their investment.



“However, the availability of only short-term contracts limits the inflow of non-resident capital to markets with long-term maturites. This has resulted in a concentration of short-term maturities which the Central Bank is constantly trying to manage, being the main supplier of FX to the foreign exchange market.”



Continuing, the analysts said: “In our opinion, longer-tenor futures will help to drive capital into Nigeria’s economy. If the FX curve is extended, bonds with maturities of up to 10 years will become more liquid than they currently are, as they will become more accessible to foreign portfolio investors.



“Also, an extension of the FX futures curve could result in an increase in foreign direct investments because investors will take advantage of the futures to guard against exchange rate volatility.

“Additionally, an extension of the curve provides opportunities for Nigerians in diaspora to bring their money home and would also be beneficial to long-term borrowers in foreign currency (corporates and non-corporates) as it reduces the fear of an unexpected erosion in the value of the naira.”



Bloomberg recently reported the Chief Executive Officer of FMDQ, Mr. Bola Onadele, as saying   that given softening crude oil prices, the securities exchange was holding discussions with the CBN about extending the FX futures curve to between five and 10 years in order to reduce pressure on the naira and attract capital inflows into the country.



The news agency quoted Onadele as saying  that market dealers and the FMDQ were “engaging the central bank to extend the curve of the FX futures because it will create stability for capital inflows into Nigeria,” adding that, “We wish for 5- to 10-year futures.”



According to the FMDQ CEO, “the best way to guard against exchange-rate volatility is to purchase futures contracts. Longer-tenor futures will help to drive capital into Nigeria. It also provides opportunities for Nigerians in diaspora to bring their money home.”



“The availability of this FX futures product reduces, if not eliminates, the need to hoard FX and front-load on FX requirements.”



He expressed optimism saying “foreign-portfolio investors tracking value will buy the futures, so will foreign direct investors and long-term borrowers in foreign currency.”



As the CSL Research analysts pointed out “in recent times, pressure has been mounting on the country’s reserves as oil prices have been oscillating around the government’s $60/bbl benchmark, causing outflow of foreign investment from the capital market.

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Awobodu: Political interference fuels fraud in procurement process



Mr. Kunle Awobodu is the new President of the Nigerian Institute of Building (NIOB) and founding president, Building Collapse Prevention Guild (BCPG). In this interview with Dayo Ayeyemi, he speaks on various issues affecting the housing and construction sectors in Nigeria and what should be done to resolve them



Many people believe there is corruption in the construction sector, especially in the procurement process. What’s your take on this?



Construction over the years has been seen as an outlet for siphoning funds. The cost of construction is huge. Are you talking of roads and construction running into billions of naira? There is always temptation to pad the estimate and tendency to introduce variations to be able to make extra profits from such a project. Some might not be legitimate; it is an indirect way of generating income for certain use politically. Engineers in  road construction in Nigeria do not  permit  quantity surveyors to interfere in the estimates; rather they use Bill of Engineers. That is the difference.



How can corruption be checked in the building  industry?



Building construction is guarded by standards. When money devoted to construction works cannot be juxtaposed with the quality expectation, then that project will fail. Procurement process is useful at promoting due process, but don’t forget that the system that brought most of the public office holders to power is compromised. When you expend so much on electioneering, you are bound to recoup your investment and one of the things to do to recoup the money is the idea of getting contracts for  project execution. As a result, the procurement process could be influenced because if you are a procurement officer, you may have problem not dancing to the tune of your boss. Our electoral system is very expensive, the system of government is very expensive, so, if huge resources are expected from party members, those who sponsored public officers must have got the money from somewhere and want to recoup their investment by getting contract. And if some of the contracts are tight, there is no way they can get further remunerations. If it is competitive and is given to the lowest bidder that has political interest, the only way he can have extra income in such a project is to compromise quality. Can you see the difficult situation we find ourselves? You cannot have your cake and eat it. Invariably, the due process that is supposed to checkmate overloading of contract sum is the procurement system, but you discover that those who bid for project innocently might end up not  getting the contract because of certain hiding interests.



Yet, it is a known fact that President Buhari is fighting corruption, but his experience as a military Head of State is at conflict as a civilian president. As a military head of state, he used fiat to get things done without much hindrance, but as a civilian president, there are so many obstacles that he needs to maneuver. He is surrounded by businessmen and political jobbers.



  If you are to set agenda for the president and ministers, what would be your priorities?



I credit the government over its empowerment programme. N-Power programme is to train Nigerian youths from  age 18 to 35 in trademanship so that they would have handwork instead of having ambition towards white collar jobs. So, Council of Registered Builders of Nigeria (CORBON) and NIOB have been training artisans across the country so that they would be able to generate income on their own rather than waiting for government to give them salary. The area government should look at, which is very critical is how it will increase the value of naira.  When we went to Builders’ show in the United States, one of the objectives is to bring investors to Nigeria on building materials, but by the time we compared prices of building materials  and converted  them  to  naira, it was huge. So, the best thing is to start manufacturing most of these things in Nigeria so that we will not be importing them, which was what China did to raise the value of their currency. This government has been given second chance but in the next two years if people don’t see significant improvement in the economy, they would become despair; they would lose interest in the government. The greatest challenge before this government is economy because in a country where you have huge number of youths that are untrained and unemployed, then crime can never be far-fetched. There is no way you can control crime. One of the sectors that generates jobs for youths is the construction industry. For this reason government must deliberately checkmate the influx of foreign artisans so that those within the country can also get jobs.



The issue of Ministry of Work and Housing getting involved in construction of housing scheme might not really solve the big challenge of inadequate housing provision. Private sector is still better to handle the crisis. I think the ministry should be an umpire – a magnetic pole that would attract developers from private sector and coordinate them appropriately for provision of houses. We have seen the ministry getting involved in construction of houses during Shagari regime, but one of the hidden      reasons is because of political patronage. It is when they have such projects that they use to compensate those who have contributed to the campaign. It is also a way of taking care of them and we can’t rule them out. It is give and take system, but the ministry should ensure that those who are working for the political contractors have professional experience/qualifications



Dangote group recently said its refineries project was delayed due to lack of quality steel. Are you not worried that Nigeria has not been able to revamp Ajaokuta Steel Company to fill the gap?



Steel companies are very germane for rejuvenation of the nation’s economy. We are worried about the moribund nature of Ajaokuta steel milling over the years; and for many long time, that has always been going back and front, moving round the circle. For a project that is very crucial for the development of a nation’s steel sector to be moving round the circle without progress is very worrisome.



We are just lucky that the Indian and Chinese came with rolling mills, which are majorly concentrated around Ikorodu, Lagos. These are the rolling mills that have  been helping the  steel sector in the country. Without them, the sector would have been in shambles. Everybody knows that Ajaokuta is very pertinent to the growth of Nigerian economy, but  somehow, it has been moribund. I don’t know how this government will handle it. It requires a lot of discipline and action; it requires a lot of reengineering;  it requires rumination about where the expertise would come in to deliver.



What are the benefits if the major steel company is rejuvenated?



It would aid the manufacturing industry. Also, rather than importing billets from abroad, we will get them right here and also get the iron right here. Even those who are manufacturing steel-based vehicles and other things will find it cheaper to operate. Bringing vehicles, trucks and equipment that are manufactured from steel to Nigeria are very expensive with the nation’s weak naira. That is why we cannot afford new ones but fairly used plant, vehicles and equipment.  Invariably, if  the steel company becomes very active, honestly speaking, prices of steel-based materials will become affordable.



Are you not worried about the huge unemployment rate among Nigerian artisans despite various re-training exercises?



The unemployment is general, it cuts across all professions. We should try to find out from the cement manufacturing companies and steel rolling mills, they would be able to provide data of what they have been producing in the past. When juxtapose with the present,  it shows there was a decline in construction activities. Also, when you have a competitive market, you would advitise yourself to me that your handwork would also be under perpetual request.  It is one thing to train them, it is another thing for the trainees to market themselves when such trainings are offered.  It is one thing to train people who are offered such opportunities to display their skills, but somehow they could not impress their supervisors. This means their patronage would not be constant. It is one thing for you to make claims on a trade, it is another thing to deliver.



There is argument that foreign artisans are taking over their jobs despite being trained and certified by government. Is this true?



System of construction makes it difficult to impose workers on contractors because the construction companies have the right to recruit workers and access them. So if they bid for government’s project and you now introduce a clause that whosoever win  the contract must engage building artisans trained by government,  what  do you think would happen to the artisans they groomed over the years? If you say government has trained some artisans and that  those building artisans working with the construction companies should  hand off while local artisans take over the jobs, do you know that the contractors might use it as an excuse for poor performance?



This means that government has interfered in the system they have enjoyed over the years. It is a complex situation for any government to impose building artisans on contractors.



Also, if they talk of foreign artisans like those from West African countries, our local artisans should replace them because we need to empower them. But the area we need to also address is dexterity, skill and expertness.


When you talk of skills, are we satisfied with the skills the indigenous building artisans are displaying?



Some of them are acceptable; some of them are below average.




Is this the  main  reason for their joblessness?



It might be. Some of them are below standards. If you go around, government projects are not so many when it comes to building construction. Most of the estates are being developed by private companies or private developers. So this is the area where  building artisans have to focus. Can those developers who are making use of Chinese, Indians and Togolesse be convinced to start patronizing indigenous building artisans? Whether you like it or not, anybody that has fund to execute project would not want to engage  building artisans that would be creating problems for the project. A developer told me her experience that large  building that were constructed in one of her project sites ended up having plumbing issues.  She said people who procured the apartments were just complaining. They have to concentrate on rectifying plumbing issues. So, would you say such a person would not scout for the best hands?  This makes it very complex. We can patronize local artisans, but they need to provide good credentials.



We are worried about capital flight, aren’t you?



We are concerned. We have understudied major reasons foreign artisans are more competent than ours.  Some of them passed through the system of National Vocational Qualification for Frameworks (NVQF) – that is the system that would be assessing the performance and  skills or abilities of building artisans and put them under gradation or levels.  They would go through the system, they would assess their works practically and discover their shortcomings and deficiencies, and then improve on them.  I am an assessor. I have gone through the training and I can assess artisans and discover their deficiencies and have a way of improving on them. We don’t have this system. Presently, the National Board of Technical Education has introduced it to our system.  We now have National Skills Qualification Framework. This will enable us to assess the ability of our local artisans, assess level of their skills and introduce up-skills, having discovered their area of deficiencies. If this is done, local artisans would be able to compete successfully with foreign artisans.




What is your advice to these artisans?



They should not despair; they should not be frustrated, they should be optimistic that things will get better. It is a matter of time, they would become more relevant than foreign artisans. Of course, as I have told you, private sector is re-investing more into the building sector than government. If you go to Lekki axis, you will see huge estates and construction going on there. We are going to be having meeting with developers as part of my programme on how to patronize local artisans and make them gainfully engaged in construction work.

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Costs hurt Cutix Plc’s earnings



Costs hurt Cutix Plc’s earnings

Nigeria’s weak macro-economic environment and its multiplier effect on businesses has triggered sustained pressure on the profit margin of Cutix Plc. Chris Ugwu writes




iven headwinds such as weak demand on the back of a squeeze on household wallets, most consumer goods companies in Nigeria have continued to find it difficult to weather the storm.

Rising cost of raw materials, driven by the challenging macro environment and fiscal and monetary headwinds have resulted to a marked reduction in domestic output, which has impacted negatively on companies’ bottom line.

The impact has been more especially on multinational consumer goods firms that have taken up foreign currency liabilities.



Also, infrastructural deficit, particularly electricity supply and bad road networks, have continued to hit hard on manufacturers, at times forcing some of them to fold up.

The prevailing macro-economic indicators also point to a sector, which is headed for collapse, if adequate measures are not taken to arrest the situation.

One of the companies negatively affected is Cutix Plc, which has seen fluctuations in profits.

The company had begun the financial year 2018 with a considerable gain of 7.21 per cent and also closed the year with eight per cent growth despite declines recorded during the half year and Q3.

However, due to high cost of sales occasioned by operational challenges, the company began the 2019 financial year unimpressive with a 15 per cent decline to what market watchers attributed to weak consumer demands, stiffer competition and lack of accessibility to key markets in some parts of the country, coupled with increased costs, which have resulted in slow growth of many fast moving consumer goods companies.



Following the sell offs that have enveloped equities market in recent times, market sentiments for the shares of Cutix, one of the building material firms listed on the floor of the Nigeria Stock Exchange, has also depreciated  significantly.

The share price, which closed at N2.03 per share in October 2018, has recorded a drop in growth that when the closing bell rang on Friday, the company’s share price stood at N1.50, representing a decrease of 53 kobo or 26 per cent year to date.




Cutix Plc closed the year ended April 30, 2018 impressive with 71 per cent growth in profit after tax to N440.295 million from N257.497 million recorded in 2017.

Profit before tax stood at N661.563 million during the period under review from N370.143 million posted a year earlier, accounting for an increase of 79 per cent.


Revenue grew by 38 per cent to N5.057 billion from N3.675 million reported in 2017.
In view of this performance, the directors recommended a dividend of 20 kobo per share to be paid to shareholders.

Cutix began the financial year with considerable gain of 7.21 per cent for the first quarter ended July 2018.


Its unaudited financial report showed that the company posted a profit after tax of N111.629 million for the first quarter as against N104.117 million reported in 2017.

Profit before tax stood at N171.737 million from in 2018 from N160.180 million posted in 2017, accounting for a growth of 7.21 per cent.

Revenue of the company grew marginally by two per cent from N1.296 billion in 2017 to N1.322 billion in 2018.



Cost of sales stood at N901.955 million during the period under review, from N925.129 million in 2017.

However, expectation that the firm would maintain growth momentum in bottom line was dashed as Cutix Plc closed the half year ended October 31, 2018 with  7.74 per cent decline in net earnings.


According to the company’s filing with the Nigerian Stock Exchange, its half year profit after tax dropped from N242.850 million in 2017 to N224.058 million during the period under review, accounting for a drop of 7.74 per cent.

The company’s profit before tax equally decreased by 7.74 per cent to N344.704 million in 2018 as against N373.616 million reported in 2017.


However, revenue increased by 2.20 per cent to N2.783 billion during the second quarter ended October 2018 from N2.723 billion recorded during the comparable period of 2017.


Cost of sales stood at N1.932 billion during the period under review from N1.920 billion in 2017.

Cutix ended Q3 with a dip in bottom line to post 9.39 per cent decline in net earnings for the nine months ended January 31, 2019.


Its nine months profit after tax dropped from N332.064 million in 2018 to N300.867 million during the period under review, accounting for a drop of 9.39 per cent.

The company’s profit before tax equally decreased by 9.39 per cent to N462.873 million in 2019 as against N510.868 million reported in 2018.


However, revenue increased by 7.51 per cent to N4.131 billion during the third quarter ended January 2019 from N3.842 billion recorded during the comparable period of 2018.

Cost of sales stood at N2.932 billion for the period as against N2.672 billion, accounting for an increase of 9.73 per cent.


Cutix reported seven per cent growth in revenue for the full year ended April 2019 to N5.434 billion from N5.057 billion in 2018.


Profit after tax rose by eight per cent to N477.070 million in 2019 from N440.296 million in 2018 while profit before tax stood at N679.332 million from N661.563 million in 2018, representing a growth of three per cent.

Based on the result, Cutix declared a final dividend of N220.1 million for the financial period ended Tuesday, April 30, 2019. This translates to 12.50 kobo per 50 kobo ordinary share.


The dividends will be paid electronically on Wednesday, October 30, 2019, to shareholders whose names appear on the register of members as at Friday, October 11, 2019, and who have completed the e-dividend registration and mandated the registrar to pay their dividends directly into their bank accounts.


However, Cutix began first quarter of 2019 unimpressive with a post of 15.42 per cent decline in net earnings for the period ended July 31, 2019.


According the company’s filing with the Nigerian Stock Exchange, its three months profit after tax dropped from N111.629 million in 2018 to N94.415 million during the period under review, accounting for a drop of 15.42 per cent.

The company’s profit before tax equally decreased by 15.42 per cent to N145.254 million in 2019 as against N171.737 million reported in 2018.


However, revenue decreased by 3.63 per cent to N1.274 billion during the first quarter ended July 2019 from N1.322 billion recorded during the comparable period of 2018.


The company’s cost of sales stood at N896.551 million from N901.955 million in 2018.

Profit deflators


The company had said that the operating environment in Nigeria remained very challenging despite some positive changes recorded during the 2018 financial year.


It noted, however, that the Central Bank of Nigeria took advantage of the increased foreign reserves to complement the availability of foreign exchange. With the availability of sufficient foreign exchange, the import of raw materials through Letters of Credit (LCs) increased, thereby reducing the attendant risks associated with the purchase of foreign exchange from parallel markets.


“Cutix Plc could, therefore, purchase the bulk of its foreign exchange requirements through the more cost effective official and more stable import-export (I & E) window.


“We recorded significant increases in the sale of power/armored cables due to high demand from ‘Operation Light up Nigeria’ projects in Anambra State. Nigeria’s multi-decade long electricity problems persisted during the financial year compelling our Company to rely on relatively more expensive AGO powered generating sets,” the company said.



It had earlier stated that the issue of multiple taxation had not been fully addressed by the federal and state government.

“A few government agencies are still finding alternative ways of increasing taxes which have created further hardship to local manufacturers and businesses,” it said.


The Chief Executive Officer, Mrs. Ijeoma Oduonye, had said her vision was to find success drivers and solidify on them, stressing that the company would maintain quality, which they are known for as well as good customer relationship.

According to her, the company took bold steps in the face of inflation and insisted on quality which speaks for their products pointing out that what they present to regulatory agencies is what they sell to their customers.


Oduonye, who lamented the poor power supply in the country and the influx of substandard products into Nigeria market as threat to quality goods manufactured locally, called on government to take necessary steps to protect local manufacturers.

Looking ahead


The management said: “We shall continue to drive for sustainable and profitable growth. Specific areas of focus will be capacity expansion, human capital development, improvement of operational efficiencies and improved culture of accountability.


“We will also track and take advantage of the increases in the sales of power/armoured cables especially from the continuing “Operation Light up Nigeria” projects in Anambra and other states in Nigeria.

“The company plans to continue driving its current aggressive growth ambitions. Special focus will be on volume capacity expansion and accelerated profitability whilst remaining competitive in the market place.”


Last line

Following challenges in the operating environment, the management of Cutix should proactively work towards cost reduction and optimisation in all areas of its operations to ensure the survival of the business and its sustained value creation for stakeholders.

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PPPRA: Nigeria records steady growth in domestic LPG utilisation



PPPRA: Nigeria records steady growth in domestic LPG utilisation

The Executive Secretary of the Petroleum Products Pricing Regulatory Agency (PPPRA), Abdulkadir Saidu has commended the efforts of the Federal Government, industry operators and regulators in deepening the utilization of Liquified Petroleum Gas (LPG). According to him, the effort is paying off in the penetration in the country.


The Executive Secretary made this disclosure in Abuja in a statement he issued on Sunday.



According to him, while domestic utilization ranged between 40,000MT and 54, 000MT from January to April 2018, July 2019 monthly utilization hit 78,000MT.


He said: “this figure is expected to increase in the months ahead as some of government and industry initiatives take root.


“Correspondingly, there has been a steady decrease in kerosene utilization within the same period indicating that Nigerians are increasingly finding value in the switch to LPG from House Hold kerosene for cooking and other domestic purposes.”


Speakin further,  he said: “The rapid growth in LPG utilization is in fulfillment of the vision of the government on deepening LPG utilization in the country as encapsulated in the National Gas Policy 2017.”


He assured that government, regulators, operators and other stakeholders will remain focused on the formulation and implementation of a stream of policies that will see to the actualisation of the 5 million Metric Tons cumulative target by the year 2022.


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SEC: Rules on Sukuk has enhanced issuance process



SEC: Rules on Sukuk has enhanced issuance process


he Securities and Exchange Commission (SEC) has said that the release of rules on Sukuk bonds has enhanced the issuance process and fostered participation in the instrument.

The Acting Director General of SEC, Ms. Mary Uduk  who stated this at a two-day international capital market conference held in Lagos by SEC in collaboration with the University of Lagos, said that following the development, Osun state issued a Sukuk bond to finance building of schools while the Federal Government used two series of Sukuk isuances to finance roads and other infrastructure.



“As we move into the future, we expect to see the issuances of such new products in our market,” she said.



Uduk noted that to further support infrastructure financing, especially projects with positive environmental impact, SEC released the rules on Green Bonds in December, 2018.

“The rule defines Green Bond as any type of debt instrument, the proceeds of which would be exclusively applied to finance or refinance in part or in full new and/or existing projects that have positive environmental impact. You may agree with me that green bonds are essential elements of our journey towards economic development and sustainability.



“So far, the Federal Government has issued two green bonds to finance afforestation, renewable energy, provision of clean energy and other climate change initiatives. Also, two companies (NSP-SPV Powercorp Limited and Access Bank Plc) have issued this instrument to finance eligible green assets and projects,” Uduk said.



“As we move into the future, we need to continuously embrace innovation in the way we carry out our market operations and regulation. Financial innovation is germane for the conception and delivery of a dynamic industrial society. Market participants and regulators have to continually familiarize themselves with the rapid ever-changing economic, regulatory and business environment.

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Flooding: Averting farmers’ yearly losses



Flooding: Averting farmers’ yearly losses

As the rainy season gradually gets to its peak with attendant flooding, stakeholders in agric and insurance sectors are expected to step up efforts to minimise losses that are peculiar to the season. Sunday Ojeme reports



ast year, some agric sector stakeholders in the country lamented the grave losses by farmers to attacks on various crops and livestock attacks.

Although they put the estimated loss from livestocks alone at over N20 billion annually, efforts to stem the tide appear not to be enough as agric investors are continually being exposed to series of natural disasters, especially flooding that keeps ravaging their investment.


Stakeholders’ worry


According to the stakeholders, absence of insurance cover for smallholder farmers is part of the reasons livestock agriculture was not growing in the country.


Although they acknowledged the importance of insurance in their business, they, however, lamented the absence of specific products tailored along their investment.

According to the Executive Director, Zynosism Nigeria Ltd, Dr. Kolade Adebayo, the insurance sector should create products that capture small farmers.


“The absence of insurance products for small farmers is costing the agricultural sector over N20 billion annually. We need insurance products that will aggregate small farmers cooperatively and provide cover for them. As such, insurance companies need to deal with poultry associations, rice farmers association and so on so that agricultural produce can be enhanced.


“Risk is an integral element of the farming industry, but the challenge we are having is that we don’t have the insurance partnership to cover most of our risks. The association of livestock farmers usually organize annual agric forums where we come together to discuss issues. For years we have always invited stakeholders from other sectors to rob minds together on ways of moving agric business forward. For over 10 years that we have been having this forum, while we have had many representatives from other sectors, we only see one person from the whole of the insurance industry. This is not good for the insurance sector.”


Similarly, the Chairman, SME Trade Group, Lagos Chamber of Commerce and Industry (LCCI) Mr. Biodun Oladapo, echoed Adebayo when he said that livestock business was still stunted in Nigeria because over the years there has not been insurance support to give it a boost.

Oladapo said: “We have seen little growth in livestock business in the country because we have not had adequate insurance support. Any farmer that has any insurance cover today got it because they wanted bank loans. Unfortunately, no bank in Nigeria will give any farmer loan without insurance cover.


“For the farmers that have insurance, when cows enter a rice farm and eat up the rice, the insurance companies will tell you that ‘cow eating rice’ was not covered. At the end of the day, no claim will be paid and the farmer is abandoned to his fate. Such incidents have contributed in impoverishing many farmers and the experience is causing apathy between us and insurers. So there is need for the insurance sector to introduce products that will cover all our risks.”

Touched by the outcry, the President of the Nigerian Insurers Association (NIA), Mr. Tope Smart, promised that the insurance industry would partner the agricultural sector going forward as part of measures to survive and thrive, saying that even the insurance sector was under threat of survival, and as such, should re-strategize and innovate to continue to exist.


This is not the first time that farmers would come out openly to bemoan losses to disasters, especially following their failure to take advantage of benefits provided by government through insurance.

Recall that last year, President Muhammadu Buhari had personally promised compensation to farmers whose investments were lost to flooding. It has, thus, become an annual ritual for the few farmers now in the business, as bandits and cattle herders have scared others out, to agonise over losses to flooding and other disasters including strange insects.


Raising the alarm


As a matter of caution and the need to be prepared, the management of Nigerian Agricultural Insurance Corporation (NAIC) has again drawn their attention to the ‘Red Flood Alert’ issued by the Nigerian Hydrological Services Agency (NHISA) with respect to some states of the federation.


NAIC’s alarm to farmers is to enable them prepare early by arranging insurance cover for their investments.

According to the Managing Director/CEO of the Corporation, Mrs. Folashade Joseph, the reminder underscores the need for farmers to keep abreast of the impact of the heavy rains, which is expected to peak between the months of August and October, 2019.

She advised all farmers, especially those covered by NAIC, to strictly adhere to best agricultural practices, as they have already been educated by the Corporation during various farmers sensitisation programmes on how to maintain sound house-keeping on their insured projects, thereby closing gaps of risk occurrence.


To consolidate on Federal Government’s seriousness in putting an end to the farmers’ plight, the National Insurance Commission (NAICOM), issued licences to more operators for agric insurance business.

FG’s commitment

In the past, about  $5 million was approved by Federal Government to enhance the activities of NAIC for adequate crop and livestock insurance, a gesture that was meant to support NAIC’s institutional reforms, strengthen operations and roll out agricultural insurance products.

The Federal Government said then that it understood the importance of risk management in agricultural investment and, therefore, decided to build its capacity and prepare it to effectively meet the insurance needs of the agricultural sector.

“As we continue to modernise the agricultural sector, we will ensure that farmers are protected from the effects of climate change. The devastating flood of 2012 was a wake-up call for the need to develop policies and risk transfer systems to protect the government and farmers from effects of climate change,” it said.




Last year, the rainy season, which typically runs from March to September, brought with it inevitable flooding, killing over 100 people.

The flooding, which submerged houses, farmland and other businesses, is always exacerbated by poor infrastructure and lack of planning to protect against the waters.


Already, flood has started taking over some parts of the country with houses and farmlands being submerged, thus exposing farmers to risk of losing their investment, considering the heavy rains still expected within the next few weeks into the month of October.

To further encourage the farmers, the management of NAIC had emphasised that the underwriting firm would always pay appropriate compensation to insured, whose agricultural farmlands were ravaged by the flood disaster across the country.


She urged insured farmers to make all efforts possible to avert and minimise the untoward effects of the torrential rains and floods on their farms by promptly informing the nearest NAIC office in their states of their travails so appropriate support will be extended to them in a timely manner with emphasis that the succour would be strictly for farmers insured under its policy.

Expert’s opinion


Despite efforts by government and insurance firms, a practicing farmer, Mr. Anga Tonya, had blamed the poor utilisation of agric insurance on ignorance on the part of farmers.

He described agric insurance as the best form of support for farmers to recoup their investment in the case of losses.

He said: “Agric insurance is very good. Over the years, farmers have not utilised crop insurance adequately and as a result they suffered colossal losses. The reason actually is due to ignorance and that is still the same reason a lot of farmers are not involved in it.

“Another reason is the cost implication. Most of the farmers don’t know what it costs. They think it is very expensive whereas it is something they can afford if only they take time to find out.


“I believe the best thing to do, moving forward, is to sensitise farmers on the benefits. Basic knowledge and information would make a lot of difference. When they know it will protect their interest and crop, they will go for it.”

Last line



As the raining season typically sets in again with all the threats already being visible through early signs of disasters as typified by flooding, it is expedient for farmers to tow the path of wisdom by approaching any of the licensed agric insurer for advice and the best insurance product to ensure his investment does not end in vain.

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Stock market halts weekly losses with 2.3% gain




Financial Services industry led the activity chart with 840.704 million shares valued at N10.765 billion traded in 11,331 deals



rading activities on the floor of the Nigerian Stock Exchange (NSE) at the weekend  finished on the green route as the NSE All-Share Index and market capitalization appreciated by 2.33 per cent and 2.39 per cent to close last week at 27,779 and N13.523 trillion respectively.

Similarly, all other indices finished higher with the exception of NSE Insurance and NSE Industrial Goods Indices which depreciated by 2.13 per cent and 0.41 per cent while the NSE ASeM index closed flat.


A total turnover of 1.147 billion shares worth N14.082 billion in 17,980 deals were traded last week by investors on the floor of the Exchange in contrast to a total of 1.101 billion shares valued at N17.082 billion that exchanged hands the previous week in 15,431 deals.


The Financial Services industry (measured by volume) led the activity chart with 840.704 million shares valued at N10.765 billion traded in 11,331 deals; thus contributing 73.30 per cent and 76.45 per cent to the total equity turnover volume and value respectively.



The Conglomerates industry followed with 111.231 million shares worth N243.124 million in 963 deals. The third place was ICT Industry with a turnover of 95.087 million shares worth N605.135 million in 404 deals.

Trading in the top three equities namely, Guaranty Trust Bank Plc, Access Bank Plc and FBN Holdings Plc (measured by volume) accounted for 484.003 million shares worth N8.306 billion in 4,265 deals, contributing 42.20 per cent and 58.99 per cent to the total equity turnover volume and value respectively.


Thirty nine equities appreciated in price during the week, higher than 27 equities in the previous week. 19 equities depreciated in price, lower than 34 equities in the previous week, while 108 equities remained unchanged, higher than 105 equities recorded in the preceding week.

A total of 6,540 units valued at N23,650.70 were traded last week in  five deals compared with a total of 3,692 units valued at N1.974 million transacted the previous week in 10 deals.


A total of 274 units of Federal Government Bonds valued at N280,932.14 were traded last week in 7 deals compared with a total of 47,690 units valued at N51.008 million transacted the pprevious week in 15 deals.

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Nigeria’s broadband growth slows



Nigeria’s broadband growth slows

Rises by 2% in 7 months



In the absence of a new plan, broadband growth in Nigeria has become lethargic



fter surpassing 30 per cent target last December, broadband penetration growth in Nigeria has slowed down since the beginning of this year, as penetration figure released by the Nigerian Communications Commission (NCC) revealed that the country only managed to grow broadband by 2.2 per cent between January and July 2019.



This was a departure from the level of growth recorded last year, where penetration grew averagely by one per cent monthly. While some months recorded less than one per cent growth, others witnessed more than one per cent. For instance, in April 2018, penetration grew by 2.9 per cent, while it rose by 1.6 per cent in May. In September, the penetration rose by 2.8 per cent. The steady growth helped the country achieve 11.6 per cent growth in the full year, bringing the total penetration to 31.48 per cent in December.



However, analysis of seven months data released so far for this year by the NCC showed that penetration grew by 0.86 per cent in January to 32.34 per cent. By February, it rose by 0.74 per cent and in March it went up marginally by 0.14 per cent. In April, it grew by 0.48 per cent. However, in May, there was a reversal of growth, as penetration declined by 0.57 per cent.  In June and July, Nigeria’s broadband penetration rose by 0.18 per cent and 0.41 respectively, bringing the total penetration to 33.72 per cent.



According to a World Bank study, a 10 per cent point increase in fixed broadband penetration would increase Gross Domestic Product (GDP) growth by 1.21 per cent in developed economies and 1.38 per cent in developing ones.



Speaking with our correspondent on the cause of the slow growth, President of the Association of Telecommunications Companies of Nigeria (ATCON) Mr Olusola Teniola, said the methodology used to arrive at the level of broadband penetration last year took into account population lower than the current peg of 200 million. He noted that the rate of population growth in the country is higher than the rate of broadband subscribers’ growth hence the penetration rate may start dropping as population increases.



Teniola added that operators’ efforts to increase the rate of penetration are still being hindered by myriads of challenges, which the government has not addressed as part of the National Broadband Plan (NBP). He said with the current state of things in the sector, broadband growth is not sustainable in the country. “Without a religious focus on the details highlighted in the NBP, it is very unlikely that the broadband penetration achieved will remain sustainable in the future. It is exceedingly important to note that a revised NBP from 2019 – 2024 is now overdue to revise the minimum speeds and other areas of demand that makes any broadband penetration relevant to the present context,” he said.



The Federal Government had in 2013 launched a five-year National Broadband Plan (NBP 2013-2018) with a target of achieving 30 per cent penetration by end of 2018, from six per cent in 2013. By last December, the country was said to have surpassed the target, as penetration hit 31.48 per cent.



However, the ATCON President noted that absence of a new plan after the expiration of the NBP 2013-2018 has slowed down the momentum.  “ATCON has already recommended to government in 2018 a figure of 70 per cent by 2024 to ensure the momentum in terms of effort and necessary levels of investments are encouraged,” he said.



The Executive Vice Chairman of NCC, Prof. Umar Danbatta, recently said that there was no official pronouncement on a new plan yet from the government, adding that plans were afoot to come up with another penetration target to be attained in the next five years of the mission of National Broadband Plan phase two.

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Climate change ranked top extreme risk for investors



Climate change ranked top extreme risk for investors



lobal temperature change is the number one extreme risk to economic growth and asset returns for investors, a new ranking by the Thinking Ahead Institute has suggested.

Also, a global trade collapse is the number two extreme risk listed in the index, driven by a rise in protectionism and other geopolitical developments over the last six years.


Cyber warfare completes the top three risks, with the prospect of a weaponised internet thought to be increasingly possible as the world becomes more connected.


Tim Hodgson, head of the Thinking Ahead Group, said that extreme events are much more likely than previously thought in a complex world, even if they are hard to imagine, according to a report obtained from The Actuary.

“We believe that the world is subject to fundamental changes, whether environmental or political, which will alter power balances,” he continued.


“Global temperature change becomes the highest ranked risk due to our assessment of higher likelihood coupled with significant impact in the extreme, this would mean mass extinction.”

Extreme risks are described as “events that are very unlikely to occur but that could have a significant impact on economic growth and asset returns should they happen.”


Biodiversity collapse and abandonment of fiat money enter the top 15 risks for the first time, while deflation, terrorism and an insurance crisis drop out.


The Thinking Ahead Institute, established by Willis Towers Watson in 2015 said there are three main hedging strategies available to investors, one of which is holding cash.


It highlighted how cash has held its real value through episodes of inflation and deflation over long historical periods, although there is no guarantee this will remain so in the future.

The researchers also said that investors should look to hold derivatives and a negatively-correlated asset, but warned that no asset will work against all possible bad outcomes.

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