News

NDIC Opposes Senate Over CBN Autonomy


By Chris Uba

Mr. Umaru Ibrahim, managing director of the Nigeria Deposit Insurance Corporation (NDIC), has warned that the sustenance of the nation's financial systems stability will be truncated if the Central Bank of Nigeria (CBN) is not allowed to operate independently.
Ibrahim made this known as he joined the on-going criticism of the planned removal of CBN's autonomy by the National Assembly. He spoke at a public hearing organised by the joint Senate Committee on Banking, insurance and other financial institutions. According to the NDIC boss, granting autonomy to the apex bank is a global practice which needs not to be subjected to debates.
His opinion came against the backdrop of move by the National Assembly to amend the 2007 CBN Act, first to replace the CBN Governor as Chairman of the board, and also compel to CBN to submit its budget to the National Assembly.
Citing examples from both developed and developing economies which allow its apex banks to operate without political interference, Ibrahim noted that withdrawing the statutory mandate of the CBN might put a nation's economy in jeopardy.
Other financial experts, top government officials and members of the committee were at the public hearing on the amendment of the Central Bank of Nigeria Act.
Part of the mandate of the committee's findings is to uncover if the apex bank deserves to remain as an autonomous institution, capable of not submitting its budget to the national assembly.
The International Monetary Fund (IMF) had penultimate week advised the National Assembly against tampering with the CBN's autonomy, saying that such move would negatively impact on the country's monetary policy and economy.
IMF said Nigeria was presently enjoying monetary regime due to the relative independence of the CBN which allows it to respond quickly to global financial reality.
 Mr. W. Scott Rogers, IMF Country Chief/Senior Resident Representative said the idea should be dropped for the sake of the Nigerian economy.
The House of Representatives last week vowed to ensure that the CBN comply with constitutional provisions and submit its annual budget for scrutiny to the legislature.
Mr. Albert Sam-Tsokwa, chairman of the House Committee on Rules and business, made the announcement at a news conference to evaluate the achievements of the house in the last one year. He said the house will ensure that the CBN submits its annual appropriation to the legislature.

NSE Advises Engineers on Sincerity,  Professionalism


By Linda Ugwuoti

The Nigerian Society of Engineers has charged members to shun corruption and use their intellectual prowess to make Nigeria an industrialised nation of distinction.
   Mr. Louis Azode said engineers are the engine room of any nation and, as such, they should be upright in carrying out their duties. He stated that looting of funds meant for developmental projects should not be their focus but trying to make Nigeria an industrialised nation should be their watchword.
   Azode said capital projects under the purview, ambit and care of engineers are the major drain pipes for corruption. "The Nigerian Engineers can and should take the bull by the horn to kill corruption and retrieve Nigeria from precipice," he said. "Engineers are the critical growth drivers of any nation and no nation grows or develops geometrically without a vibrant, strong, focused and totally committed engineering workforce."
He added that government's overbearance, undue interference, timid engineers and bad leadership are responsible for the drastic collapse of the nation's pool of infrastructure.
Azode urged Nigerian engineers not to cheapen themselves by allowing political office holders to dictate to them on issues of professionalism. He urged them to be able to say "NO" when the interest of Nigeria is being mortgaged, subverted or compromised.
“The Nigerian engineer must first and foremost see himself as an avid patriotic technocrat on whose head and shoulder lies the future of this nation. The engineer should not append his signature to certify, approve or ratify for commissioning a project that he is not religiously satisfied has been executed to the best of international best practices and standards.
He should not engage in or involve self with anything that will undermine, belittle or denigrate the dignity of the engineering profession."
Azode  stated that most foreigners continue to build Nigerian roads, refineries, power plants, dams, sewages, windmills, telephones, computers, silos, air, crafts, buses and cars, while the Nigerian engineer wallows in inferiority complex and foreign dependence.
He added the rot being excavated in the N155 billion fuel subsidy probe saga would not have taken place without the involvement and connivance of the Nigerian Engineers in the petroleum industry.
Azode advised that Nigerian Engineers should not be contended with doing routine or mundane things without tasking their brains for scientific and technological breakthrough. He commended them for their developments efforts so far but added that "the infrastructure needs of the people in the 21st century are still a far cry. Nigerians expect and deserve a lot more from you. We know you can do it".


Dana Crash: International  Community Defends Demuren

By Chris Uba

Members of the international aviation community have come in stout defence of Dr. Harold Demuren, director general of the Nigerian Civil Aviation Authority (NCAA), who has come under criticism from the National Assembly for Dana Air disaster.
The Senate, last week called for the suspension of Demuren, pending the outcome of investigations into the crash  brought before the upper legislative chamber by Senator Hope Uzodinma, chairman of the Senate Committee on Aviation.
But reacting last week, the Flight Safety Foundation, a United State (US) non-profit advocacy group, issued a statement last week calling on the federal government to "not compound this tragedy" by targeting Demuren.
"You can't let a leader go down in Africa if you want to make any change," Mr. Bill Voss, president of the Alexandria, Virginia-based foundation, said in an interview.
Mr. Tony Tyler, director general and chief executive officer of the International Air Transport Association, a Geneva-based trade group, also backed Demuren.
"Safety is a constant challenge everywhere in the world," Tyler said in a statement. "In Nigeria, as elsewhere, this important work must continue without political interference."
In 2005 and 2006, airlines in Nigeria had three fatal crashes and three others serious enough to destroy the aircraft, according to the AviationSafetyNetwork, a Netherlands-based website that tracks aviation safety statistics. Those accidents killed a total of 322. From that stretch until the Dana Air crash, there was one accident that claimed three lives, according to the group's data.
A plane operated by a Nigerian cargo airline, Allied Air, skidded off a runway in Accra-Kotoka Airport in Ghana on June 2, striking a van on an adjacent road, according to the safety network's website. The collision killed 12 people in the van.
The Dana flight crew's final radio broadcasts included "Mayday. Losing two engines" and "Throttle not responding. Not responding," Demuren said in the interview, emphasizing he was speaking from memory.
The pilot didn't mention hitting birds, which has caused simultaneous loss of power in two engines in other incidents, or any other reason for the failures, he said.
The crash-proof recorders on the jetliner, known as black boxes, have been found and will be flown to the U.S. for analysis by the Washington-based National Transportation Safety Board, which is assisting in the investigation, Demuren said.
The jet took on what Demuren characterised as a routine fuel load before departing Abuja, the capital adding that other aircraft had refueled in Abuja without reports of engine failure, which suggests the fuel wasn't contaminated.
Nigeria imposes maintenance requirements similar to those in the U.S. and Europe. Dana had performed maintenance in a facility in Istanbul, he said.
Investigators combing the charred wreckage, which was partially lodged in an apartment building, have found all major pieces of the plane, he said. It remained pointed toward the airport when it struck the ground a few miles short of the runway, he said.
Accident investigators can tell from the pattern of damage in engines whether they were under power when they struck the ground. No determination has been made on the Dana engines, Demuren said.
Today's jet engines are so reliable that it's very unlikely two would fail at once,  Mr. John Cox, a former airline pilot who is a consultant at Washington-based Safety Operating Systems, said in an interview.

Naccima  Renews Call for Non-oil Sector Upgrade


By Chris Uba

The Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (Naccima), the umbrella body of chambers of commerce in the country, has called on the government to as  a  matter of urgency begin the upgrade of the non-oil sector to enable it contribute meaningfully to the economic development and growth of the country.
The association, which spoke at its 51st annual general meeting  in Shagamu,  Ogun State, recently emphasised the need for  Nigeria to align with the global trend by refocusing and re-strategising through diversification of its economic base away from oil to non-oil products.
The association said the upgrade of non-oil sector is  needed to ensure the successful growth and development of the nation's economy and for the achievement of  the transformation and vision 20:2020 agenda.
It also emphasised the need for the federal government to remove all forms of levies and taxes imposed on some export products, especially on agricultural exports to make such product competitive in the global market place.
Dr. Herbert Ademola  Ajayi, president of the association, stressed the need for the government to overhaul the entire process of the existing export incentive regime for efficiency, including introducing new industrial incentive.
He also said that government should   carry the Organised Private Sector (OPS) along on   all its exports and export related policies and activities in the country through a sustainable Public-Private Sector Partnership (PPP) arrangement. Ajayi added that government should ensure appropriate standardisation of export products, especially, sanitary and phytosanitary (SPS) issues for agricultural products.
He added: "There should be establishment of border markets at some strategic locations; there should be adequate funding of non-oil commodities; development of infrastructural deficiency; provision of logistics to support supply value added chain; increase in dominance of primary commodities and high productive capacity; empowerment of small and medium scale enterprise through entrepreneurship; development of agro-allied industrial; packaging and labelling standards of made-in-Nigeria products; and focusing on the comparative and competitive advantages".
He stated:  "Nigeria has to gear up to the challenges posed by the current global economic crisis, and strive to achieve its non-oil sector growth and development objectives under the vision 20:2020, bearing in mind that the international environment may not offer the expected result at all times.
This is because promoting non-oil sector products will bring about reduction on the nation's level of dependence on the dominance of crude oil or what can be described as mono-cultural foreign trade products that averagely rake in over 80 per cent foreign earnings."


GSM Companies Need N2.8trn for Network Upgrade


 By Lawson Ovih

The four GSM companies in Nigeria would require a combined investment of about N2.8 trillion to deliver an effective quality service to subscibers. Specifically, about 50,000 base transceiver stations (BTSs) are required to effectively cover the entire country.
Investigations show that despite the huge investment that has gone to networks management in the country, all the operators still need massive infrastructure roll-out especially in rural areas to meet with the demand of the over 95 million subscribers who yearn for value for their money through effective delivery of quality of service.  According to Engineer Gbenga Adebayo, chairman, Association of Licenced Telecom Operators of Nigeria (Alton), the GSM operators would make effective coverage if additional 50,000 BTSs are added to the existing ones.
Meanwhile, Tony Ojobo, director, public affairs, NCC, has stated that the commission would ensure that the recent sanctions imposed on the network providers are strictly adhered to as it would serve as a deterrent and measures of keeping them on track with their core duties of providing quality service to the over 95 million subscribers in the country. "We are looking at the next line of action and have decided never to withdraw the sanctions," he said. "After our next meeting, the commission would take the appropriate action that deems fit to it as a regulator."  However, the recent meeting held in Abuja with the chief executives of the four GSM companies ended in deadlock, as Juwah maintained unwavering position on the sanction. Mr. Steven Evans, chief executive officer, Etisalat, described the sanction as inappropriate. Mr. Akinwale Goodluck, corporate service executive, MTN, explained that the sanction was unacceptable, at this time that the companies are faced with myriad of problems, ranging from poor power situation in the country that has made them to run on generator sets, coupled with high cost of diesel and maintenance, vandalisation of BTSs, frequent fibre optic cable cut from road construction, multiple taxation, lack of right of way, among others. 

‘Be Wary of Adulterated Petroleum Products' - Odumodu


By Chris Uba
The Standards Organisation of Nigeria (Son) has clamped down   on a filling station in Port Harcourt where petroleum products ranging from PMS and AGO are adulterated and sold to the unsuspecting motorists and household users .
Neccon filling station on Eleme road, Port Harcourt was discovered to have an illegal depot behind the station where petroleum products are adulterated, while vehicles and tanks used for conveying the products including containers and  drums of different sizes with  hoses used for the adulteration were found at the vicinity.
The discovery was made when the Task Force on Petroleum products adulteration led by Engineer Timothy Abner  visited Port Harcourt as part of Son ongoing  Zero Tolerance to substandard Products in Nigeria programme. Other than the adulterated products sampled at the Neccon filling station which showed 22 per cent kerosene in diesel,  the overall quality of PMS and diesel sold in Port Harcourt and Calabar were found to meet the quality specifications, with diesel meeting the Cetane number of 49min  required for EURO11.
Dr. Joseph Odumodu, director general of the organisation, used the occasion to warn Nigerians to be wary of patronising adulterated petroleum products and dealers who have  formed the habit of short changing Nigerians by their attitude of adulterating the products, even as some of them dispense below the pump price. Odumodu said Son in collaboration with all the relevant agencies will continue to monitor the quality and quantity of petroleum products sold to Nigerians until dealers of the products revert to status quo, stressing that what Son is presently doing is a sensitisation and awareness campaign which will ultimately transform into a full blown and more robust exercise that will result in enforcement of the relevant standard.
He advised marketers and indeed petroleum products as well as dealers in the country to ensure that the quality of products dispensed to Nigerians meet the required standard so that consumers will have value for their money.
  Odumodu observed that with the abundant natural resources Nigeria is blessed with, our economy will be one of  the best in the world if  businesses are done right in Nigeria,  and solicited for the cooperation of all stakeholders in the sector so that Son succeeds in the drive of improving life through standards.

FG Account  not in Red - Okonjo-Iweala


From: Simeon Ogoegbulem, Abuja

Dr. Ngozi Okonjo Iweala, coordinating minister for the Nigerian economy and minister of finance, has reassured that the federal government is buoyant  and the  ministries, departments and agencies  (MDAs) are not facing any cash crunch as held in some quarters. There has been concerns in several quarters about the financial state of several MDAs.
Okonjo-Iweala, who spoke to media men shortly before inaugurating the new members of the Investment and security Tribuna (IST), lamented the funds paucity story saying that "I am puzzled by this issues of releases and cash crunch.  There is no case like that, right now all cash releases are not yet utilised.
According to her, "we have 29 per cent utilisation and there is still plenty of room for MDAs to implement their projects because you know that 2011 budget ended in March.''
The minister noted that after the meeting of the cash management committee last Wednesday, the second tranche releases would be implemented. 


GSM Companies Need N2.8trillion for Network Upgrade


By Onyewuchi Ojinnaka

It was a second victory for Dr. John Abebe and his company Inducon Nigeria Limited as Court of Appeal, Lagos division, last Tuesday affirmed the judgement of Federal High Court, Lagos which ordered Statoil  Nigera Limited to pay Abebe 1.5 per cent of its accruable profit from the three oil blocks allocated to it by the federal government.
    The payment of 1.5 per cent which is about $3 billion is to compensate Abebe for bringing the oil firm to Nigeria in the early nineties for oil operation business. The affirmation of the High Court judgement was sequel to the Appeal Court 's dismissal of the appeal filed by Statoil Nigeria Limited, a Nigerian-based Norwegian oil firm challenging the decision of the High Court. In dismissing the appeal filed by the oil firm, the appellate court unanimously held that the appeal lacked merit. In addition to the dismissal of the appeal, the sum of N50, 000 was awarded as cost against Statoil.
 The panel of judges unanimously held that it would amount to injustice if Abebe and his company are denied part of the profit, knowing full well that he brought the foreign firm to Nigeria to exploit crude oil. In a lead judgment delivered by Justice Hellen Ogunwumiju, the appellate court held that Statoil's appeal lacked merit and was therefore dismissed. She faulted the argument of the oil firm and its counsel, Fidelis Oditah (SAN) that judgment of the lower court was against the weight of evidence adduced, adding that their arguments were of no value. The judge held that based on the evidence before the court, it was clear that there was an agreement between Abebe and Statoil.
    She noted that there was an alliance between British Petroleum (BP), Statoil and Abebe, and in her view, the fact that BP later pulled out and left the country does not mean that the agreement reached with the respondent had died.
   She held that since Statoil was a beneficiary of the crude oil operation which was why it came to Nigeria, it implies that it inherited the terms of agreement BP made with Abebe based on the 50:50 alliance and agreement. The contention of the appellant that the public policy of the federal government on local content as canvassed by the respondent had not taken off when the deal was struck, was faulted by the judge, saying that the testimony of a prosecution witness Dr Abdullah Jibril Oyekan (PW3), who was the head of the Department of Petroleum Resources (DPR) at the time the pact was entered was credible to show that indeed there was an agreement between the appellant and the respondent.
    The appellate court resolved that the issue of privy of contract and lack of fair hearing raised by the appellant are not sustainable because it was given the opportunity to present its case before the lower court.
   Abebe, a businessman had filed an action against Statoil before a federal high court, Lagos, submitting that in April 1990, British Petroleum (BP) approached and informed him that it was interested in exploring the opportunities in the Nigerian oil industry together with its partner Statoil of Stavanger, Norway, with whom it had entered into an alliance agreement.
    He stated that the alliance, as was represented to him, would present the first ever opportunity for Statoil, then an indigenous Norwegian company, to operate outside its home base, Norway and to venture into West Africa, amongst others.