Nigeria's modular refinery promoter seeks government financial support

The promoter of Lagos 20,000 barrel daily modular refinery has challenged Nigeria government to provide the enabling environment for financial support to boost the West African country's quest to increase capacity for refined petroleum products.

Emmanuel Iheanacho, Chairman, Integrated Oil, and Gas, said the government support is required to make the dream of creating modular refineries in the country a reality.

Iheanacho said the federal government should come up with a policy framework that will compel financial institutions to make funds available to indigenous players who might intend to build modular refineries.

“Financial support is one major area we need government’s help if government realises that there is need to have a lot of the small-scale refineries to turn around the economy," he noted, adding that government should make provision for financing because it is the key requirement to do 20,000 barrels per day.
According to him, building such modular refinery requires an investment of millions of dollars, saying “We are not asking to be given grants and handout but to be assisted in the process of being able to secure financing in major financial institutions,”

Iheanacho is the promoter of 20,000 Barrel Per Day (BPD) production capacity of Eko Refinery and Petrochemical.

He said the modular refinery at Tomaro Island Port Lagos, to cost $250 million would be a hub for the refinery industry.

He noted that when the 20,000 bpd refinery comes on stream it will address government’s frequent importation of refined petroleum products into the country.

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Nigeria's Cbank says manufacturing PMI at 56.3 points in Feb vs 57.3 points in Jan

The Manufacturing PMI in the month of February stood at 56.3 index points, indicating expansion in the manufacturing sector for the eleventh consecutive month, the latest report by the Central Bank of Nigeria (CBN) has shown.
The regulatory bank said the index grew at a slower rate when compared to that in the previous month.
According to the report, from the 15 subsectors surveyed, 10 reported growth in the review month in the following order: Plastics & rubber products; textile, apparel, leather & footwear; appliances & components; paper products; primary metal; petroleum & coal products; chemical & pharmaceutical products; food, beverage & tobacco products; electrical equipment and furniture & related products.
On employment level index, the bank said the index in February 2018 stood at 53.9 points, indicating growth in employment level for the tenth consecutive month.
Out of the 15 subsectors, 6 subsectors increased their employment level, two remained unchanged while seven reduced their employment level in the review month the following order: printing & related support activities; cement; nonmetallic mineral products; fabricated metal products; and transportation equipment.
"At 57.8 points, the production level index for the manufacturing sector grew for the twelfth consecutive month in February 2018. The index indicated a slower growth in the current month when compared to its level in the preceding month. Six of the 15 manufacturing subsectors recorded increase in production level, 6 remained unchanged, while the remaining 3 recorded declines in production level during the review month," the bank said.
At 55.6 points, the new orders index grew for the eleventh consecutive month, indicating an increase in new orders in February 2018. Eight subsectors reported growth, 4 remained unchanged while 3 contracted in the review month
The manufacturing supplier delivery time index stood at 57.0 points in February 2018, indicating faster supplier delivery time for the ninth consecutive month. Six subsectors recorded improved suppliers’ delivery time, 7 remained unchanged while 2 subsectors recorded delayed delivery time

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Nigeria ruling party finally endorses Buhari's 2019 reelection bid

The National Executive Committee (NEC) of Nigeria’s ruling party APC has endorsed President Muhammadu Buhari to seek a second term in the forthcoming general election next year, Reuters report on Wednesday, quoting two senior party sources.
Buhari, who took office in May 2015, has not yet said whether he intends to seek re-election.
The 75-year-old leader spent five months on medical leave in Britain last year for an unspecified ailment, raising questions about his ability to run Africa’s most populous nation.
The All Progressives Congress (APC) NEC, which takes decisions on the party’s direction, held a one-day meeting which ended in the presidential villa late on Tuesday.
“The party made it clear that this endorsement is not an automatic ticket for the president,” one of the sources said, adding that the party would still conduct a presidential primary to be fair to other potential candidates.
But political observers said the party endorsement has automatically closed the door for any other person intending to compete for the party ticket for the general election.
A spokesman for the president could not immediately be reached for comment.
Nigeria’s political parties must select their candidates for the 2019 presidential election between Aug. 18 and Oct. 7 this year. Presidential and parliamentary elections are scheduled to take place on Feb. 16, 2019.
Adebayo Shittu, Nigeria’s minister of communications who played a prominent role in Buhari’s 2015 campaign, said in January he would chair a group to support the re-election of Buhari and Vice President Yemi Osinbajo.
Campaigning for the re-election of a president in Nigeria has often started with such support groups before the incumbent declares his intention to run again.

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Ivory Coast Lost 125,000 Tons of Cocoa to Smuggling

Ivory Coast lost an estimated 125,000 metric tons of cocoa this season through the smuggling of beans to neighboring countries where farmers and traders are paid better prices, according to two people familiar with the matter.
The industry regulator of the world’s biggest cocoa producer estimates that the country lost as much as 100,000 tons through its eastern border with Ghana and another 25,000 tons through the western boundary with Liberia and Guinea, said one of the people, who asked not to be identified because the information isn’t public. 

One of the biggest cocoa buyers in the country made a similar forecast, said the second person.
The estimates were calculated by subtracting the border regions’ port deliveries from the average of previous harvests. The total is the equivalent of 9.2 percent of arrivals since the beginning of the season in October through Feb. 25, according to government data.
Mariam Dagnogo, a spokeswoman for Le Conseil du Cafe-Cacao, the regulator, didn’t answer calls seeking comment.
Ivory Coast is struggling to contain cocoa smuggling this season after the country lowered the minimum price for farmers by more than a third to the equivalent of $1,314 per ton as international contract prices declined. 

The change opened an unusual payment gap with Ghana, the second largest cocoa producer, which left its minimum producer price unchanged at the equivalent of $1,700 per ton.
The government and regulator will review border security ahead of the smaller
of the two annual harvests which begins in April, said one of the people.

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African Eximbank to raise $200 mln in Nigeria on expansion drive

African Export-Import Bank plans to sell shares in Nigeria and two other African countries to support lending and broaden its ownership base.
The Cairo-based lender is in talks with Nigerian regulators to issue depositary receipts and raise equity worth $200 million by the third quarter, Afreximbank said in an emailed response to questions. It is still considering the other markets and will release details once discussions have been finalised, the company said.
Afreximbank, which was started in Nigeria in 1993 to finance and promote trade across Africa, will list about 67 million existing depository receipts on the Nigerian Stock Exchange to improve liquidity, it said.

The lender approved $3.2 billion of credit for Nigerian companies last year and has received loan applications from more than 30 firms in the West African nation, the lender said. 

It is targeting trade, financial services, tourism, manufacturing, export infrastructure and agro-processing for loans, it said.
As the Nigerian economy recovers, “funding is required to harness the opportunities,” Afreximbank said, adding that it is talking with the Nigerian Export-Import Bank about a joint program that will grow the country’s non-oil exports. 

Gross domestic product in Africa’s biggest crude producer expanded 0.8 percent in 2017 compared with a contraction of 1.6 percent in 2016.

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Shoprite makes bold entry into Kenya as it ramps up Africa expansion

South African Shoprite Holdings will move into Kenya, where weakened competitor positions have opened an opportunity for Africa’s biggest grocer to expand its presence in East Africa, its chief executive Pieter Engelbrecht said on Tuesday.
South African retailers have struggled to lift earnings at home as high household debts squeeze consumer income, although Shoprite has fared better than others with its focus on budget-conscious consumers, including more than 10 million South Africans on welfare grants.
To diversify its earnings base, it has expanded deeper into the rest of Africa to take advantage of oil-rich Nigeria and Angola and now Kenya.
“We have not changed our focus to say we’re not looking at the continent anymore. We have grabbed that opportunity, we’re going to Kenya,” Engelbrecht said at the presentation of the company’s half-year results.
Shares in Shoprite were up 3.88 percent to 267.99 rand by 0737 GMT.
Shoprite, which reported a 14.2 percent increase in half-year headline earnings per share, expects to be in Kenya before the end of 2018.
“Five years ago, Kenya wasn’t considered by us because they had three very big retailers there,” said Engelbrecht.
“Starting last year ... the retailers in Kenya were in total disarray and we were able to secure seven sites and leases.”

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U.S. to overtake Russia as top oil producer by 2019 at latest

The United States will overtake Russia as the world’s biggest oil producer by 2019 at the latest, the International Energy Agency (IEA) said on Tuesday, as the country’s shale oil boom continues to upend global markets.
IEA Executive Director Fatih Birol said at an event in Tokyo the United States would overtake Russia as the biggest crude oil producer “definitely next year”, if not this year.
“U.S. shale growth is very strong, the pace is very strong ... The United States will become the No.1 oil producer sometime very soon,” he told Reuters separately.
U.S. crude oil output C-OUT-T-EIA rose above 10 million barrels per day (bpd) late last year for the first time since the 1970s, overtaking top oil exporter Saudi Arabia PRODN-SA.
The U.S. Energy Information Administration said early this month that U.S. output would exceed 11 million bpd by late 2018. That would take it past top producer Russia, which pumps just below that mark C-RU-OUT.
Birol said he did not see U.S. oil production peaking before 2020, and that he did not expect a decline in the next four to five years.
The soaring U.S. production is upending global oil markets, coming at a time when other major producers - including Russia and members of the Middle East-dominated Organization of the Petroleum Exporting Countries (OPEC) - have been withholding output to prop up prices.
U.S. oil is also increasingly being exported, including to the world’s biggest and fastest growing markets in Asia, eating away at OPEC and Russian market share.
Meanwhile, U.S. net imports of crude oil fell last week by 1.6 million bpd to 4.98 million bpd, the lowest level since the EIA started recording the data in 2001, reflecting further erosion in a market OPEC has been relying on for decades.
Birol said production growth was not just strong in the United States.
“Canada, especially the oil sands, and Brazilian offshore projects. These are the two major (non-U.S.) drivers,” he said.
On the demand side, Birol said the IEA expected growth of around 1.4 million bpd in 2018.

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Nigeria's GDP up 1.9 pct in Q4 '17

Nigeria’s economy rose 1.92 percent in the fourth quarter of last year, better than -1.7 percent contraction recorded in the same period of the previous year, the National Bureau of Statistics said on Tuesday.
The West African country's Gross Domestic Product (GDP) grew by 0.83 percent in 2017 as a whole after shrinking by 1.58 percent in 2016, its first annual contraction in 25 years.
The NBS report said GDP growth in the fourth quarter of 2017 was driven by growth in crop production, crude production, and natural gas, metal ores, construction, transportation and storage, trade, electricity and gas production.
For instance, the report said crop production grew by 4.58 percent in the fourth quarter of 2017 compared to 3.19 percent in the third quarter 2017.
Crude production, it noted grew by 8.38 percent in the fourth quarter of 2017 compared to 25.89 percent in the third quarter of 2017.
Oil production rose to 1.91 million barrels a day (mbpd) in the last quarter of 2017 compared with 1.76 mbpd in the same period of 2016, the statistics office said.
The recession in 2016 was largely caused by low crude oil prices and militant attacks on energy facilities in the Niger Delta. Crude sales make up two-thirds of government revenue.
Africa’s biggest economy returned to growth in the second quarter of 2017 but the recovery has been fragile since it is largely due to higher oil prices. The International Monetary Fund (IMF) said in December that the economy remains vulnerable.

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Nigeria Takes Steps to Avoid Repeat of Etisalat Collapse

Nigeria’s telecommunications regulator said tougher financial-health checks on the country’s biggest mobile-phone companies could prevent a repeat of last year’s collapse of debt-laden Etisalat and help stabilize the industry.
The Nigerian Communications Commission has compiled reports on the financial well-being of the local units of Johannesburg-based MTN Group Ltd., the market leader with 52.3 million customers, Bharti Airtel Ltd. and Lagos-based Globacom Ltd., NCC Executive Vice-Chairman Umar Garba Danbatta said in an interview. The regulator has identified some areas of concern and these “issues that can be addressed,” he said.
Etisalat Nigeria, which has been renamed 9mobile and is for sale, plunged into crisis almost a year ago. A consortium of banks seized control of a 45 percent stake from Abu Dhabi’s Emirates Telecommunications Corp. after it defaulted on a $1.2 billion loan. The Central Bank of Nigeria and the NCC stepped in to avoid the collapse of the company, which employs 4,000 people and has about 17 million subscribers, down from 19.6 million at the end of March.
Ensure Survival
While the central bank will do a financial check of the winner of the 9mobile auction, the NCC will be focused on the buyer’s ability to provide a quality service, Danbatta said in a hotel in Kano, a city in northern Nigeria. “These are all measures we’re putting in place to ensure the survival of 9mobile and prevent a repeat of what happened,” he said.
Two companies are vying to take over the embattled operator in a process that the NCC hopes will be concluded by the end of March. Lagos-based ThisDay newspaper reported that Teleology Holdings Ltd. and Johannesburg-based data provider Smile Communications are the remaining bidders, without saying where it got the information. Both companies declined to comment. Barclays Africa was appointed as sale adviser, the NCC said in November.
“Time is of essence,” Gbenga Adebayo, president of the Association of Licensed Telecommunications Operators of Nigeria said by phone from Lagos on Wednesday. “They can only get good value for this company for as long as it has good business.”
Weaker Naira
Nigerian companies have suffered since the 2014 oil-price crash triggered an economic contraction and sent corporate earnings plunging. Rampant inflation reduced consumers’ purchasing power and the central bank’s tightening of capital controls led to a shortage of dollars, which companies need to pay for imported equipment and service foreign-currency loans. The naira lost more than half its value against the greenback in that period.
Foreign investments in the telecommunications sector dropped 86 percent to $33.6 million in the third quarter of last year, compared to the same quarter the previous year, according to data from the Nigerian Bureau of Statistics.
Etisalat Nigeria would still be here, “but for the deterioration of the exchange rate,” Danbatta said. “The NCC will continue to put in place flexible regulations that will ensure the survival of telecommunications companies in the marketplace.”

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Nigeria raises 79.6 bln naira in bond short of amount on offer

Nigeria sold 79.62 billion naira in sovereign bonds at an auction on Wednesday, fell short of the initial amount proposed as investors stayed on the sideline due to low interest offered on the debt paper.

The Debt Management Office (DMO) had planned to raise 100 billion naira worth in 5-year and 10-year paper at the auction but ended up with less amount.

Data released by the debt office on Thursday showed that a total of 27.18 billion naira of the 5-year paper was sold by the DMO at 13.70 percent yield, while 52.44 billion naira of the 10-year paper was sold at 13.98 percent.

Investors put in bids as high as 16 percent at the debt auction, but the debt office was unwilling to pay higher than the benchmark interest rate on the domestic debt.

Nigeria recently raised about $2.5 billion in Eurobond at an average of 7.6 percent in its bid to refinance domestic treasury bills at a cheaper rate.

Though investors put in about 117.58 billion naira in subscription, more than half of that was in demand for the 10-year paper.

The government has been working to lower its borrowing costs, particularly as inflation fell for the 12th time in a row in January. 

Yields on local debt have started falling since the successful auction of the $2.5 billion Eurobond last week.

Investors are waiting for the debt office to announce which bills it intends to pay off and a reduction in auction volumes for the second quarter, which could spur buying.

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Heaps of refuse all over Lagos as Visionscape falters

In the last couple of months, Lagos, Nigeria’s economic nerve centre, has been overtaken by refuse, no thanks to the Lagos State Government’s attempt at transiting from the Public-Private Partnership mechanism to a new initiative of waste management to be driven solely by a consortium under its Clean Lagos Initiative programme.
The state had last year embarked on the review of its waste management scheme under its new scheme and commissioned a consortium of waste manager, led by Visionscape, an environmental utility group. The group was expected to deploy technology, better funding, and germane solutions to execute the initiative.
The government believed that its previous scheme on waste management was not producing the maximum effect and as such, decided to deploy more scientific means to recover and recycle waste into raw materials for use in producing other products.
However, the disengagement of the previous operators under the Private Sector Participation and the rancour that follows the transition to Visionscape has frustrated the new initiative, making it difficult for smooth and efficient take-off of the new scheme as envisaged by the government.
Refuse has taken over major roads, highways and inner streets in the state, threatening epidemic across the state. Concerns over a probable outbreak of cholera and other diseases in the state as a result of the improper disposal of waste in the last couple of months have grown among the populace.
One of the critical challenges facing the new operators of waste management in the state is lack of adequate manpower to help prosecute the projects. Visionscape was just in the process of employing workers to help manage the scheme, while most of its procured vehicles had yet to be put in use due to inadequate personnel to handle the machinery.
Although the state projected that its contract with the new firm would last 10 years in the first instance with the capacity to generate 27,000 direct employment and lead to improvement in waste management in the state, the consortium has yet to employ enough manpower to implement the waste management scheme in the state.

Many of the dumpsites in the state have become inadequate to accommodate the enormous waste being generated in the state and this has slowed down the turnaround time for the vehicles transporting refuse from collection points to disposal centres.
Over the years, the state government has failed to invest enough resources in waste management and refuse recycle to promote a healthy living environment.
According to statistics, the state currently generates around 13,000 metric tons of waste daily. Last year, the state also raised about N27bn in its first green bond with a five-year tenor at 17.5 percent coupon in its quest to improve on waste management in the state. It intends to raise an additional N23bn subsequently to support the CLI scheme.
Insiders say unless the state moves to create new dumpsites to accelerate the process of collection and disposal of waste, the challenges of waste management in the megacity will persist.
Private sector operators should be promoted to handle the recycling aspect of the waste management while massive education of the populace should be embarked upon by the state government to protect the environment from indiscriminate disposal of waste.
The current dumpsites could be converted to recycle centres for interested investors with attractive incentives by the government to ease the pressure on the dumpsites and reduce health implications of the congestion in the sites.
The government could also convert part of the waste into biomass materials to produce electricity for some parts of the state. Through technology, the waste dumpsite could be converted to revenue generation centre for the state by turning the place into massive recycling hub to produce raw materials for other purposes and uses.
The government should also consider the health implications of the current situation of waste mountains across the state and ensure that it improves on collection and disposal efforts.
Some of the dumpsites should be well-treated with relevant chemicals to prevent pollution of underwater so as to avert an epidemic in the state.
The government with the help of international financial institutions could establish incinerators in some parts of the state to help reduce the volume of waste and the challenges of finding suitable dumpsites for the disposal of waste.

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NNPC says spent $5.8 bln on fuel imports since late 2017

Nigerian National Petroleum Corporation (NNPC) said on Tuesday it had spent $5.8 billion on fuel imports since late 2017, in its bid to combat scarcity of gasoline that has left people queuing for hours at filling stations.

 “The corporation’s intervention became necessary following the inability of the major and independent marketers to import the product because of the high landing cost which made cost recovery and profitability difficult,” the state-run oil firm said in a statement.
The price of petrol is a highly charged subject in Nigeria, Africa’s largest oil exporter. President Muhammadu Buhari in 2016 raised the top gasoline price to 145 naira per litre, a 67 percent hike, but did not remove a cap for fear of hurting people on low incomes.
And as global pricce of crude oil rise, the price cap on finished products makes it tough for many importers to profit from gasoline and NNPC has imported as much as 90 percent of the nation’s gasoline needs over the past year. Fuel shortages have gripped much of the country in the last few months.
The nattional Economic Council (NEC) has been in discussion with the NNPC to determine whether gasoline is appropriately priced in the country, a state governor said last week.
The relatively cheaper cost of Nigerian fuel combined with crude oil price rises in the last few months mean smugglers can make more money selling fuel intended for the Nigerian market across borders, creating shortages in the West African giant.
Nigeria’s refining system means it is almost wholly reliant on imports for the 40 million litres per day of gasoline it consumes.
Efforts by Buhari’s predecessor, Goodluck Jonathan, to end expensive subsidies in 2012 led to riots in the streets because the move would have doubled gasoline prices, angering citizens who see cheap pump prices as the only benefit from living in an oil-rich country.

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African governments hurry to beat higher borrowing costs

Governments across sub-Saharan Africa are hitting international debt markets hard and fast to try to beat rising borrowing costs, pushing the region’s debt levels to new highs.
Nigeria has raised $5.5 billion over the past three months, Kenya wants to borrow at least $1.5 billion, and Angola, Ivory Coast, Ghana, and Senegal are all queuing up.
The flurry of issuance adds to an already-record debt tally for sub-Saharan Africa, which has ballooned to over $200 billion from less than 30 billion in 2007, Bank for International Settlements data shows.
“If you have a lot of issuance in a short period of time, that tells you something,” said Kevin Daly at asset manager Standard Life Aberdeen.
“Maybe these guys are realising that their borrowing costs are going to potentially go higher over the course of the year if we get a continued rise in Treasury yields and further rate hikes by the Fed.”
With investors busy assessing where U.S. Federal Reserve interest rates are headed, the focus is now on just how vulnerable the region may be to such an increase, especially with a large pile of repayments also looming.
Rating agency Moody’s calculates Ghana has $4.5 billion of bonds due between 2020-2026, Gabon has $2 billion maturing between 2022-2025 and Zambia has $3 billion between 2022-2027.
Meanwhile, Kenya’s first Eurobond payment of $750 million, representing roughly 1 percent of its annual economic output or GDP, is due in June next year followed by $2 billion in 2024.
“For sovereigns which do not have long track records of repaying international bonds, this will represent a significant test,” Moody’s said in an e-mailed statement.
The increase in international debt issuance means “sub-Saharan African borrowers are now more exposed to shifts in global risk sentiment and external financing conditions,” they added, stressing the risk of rising borrowing costs.
Nigeria, Africa’s largest economy, is pushing ahead regardless. The country’s 2018 provisional budget has laid out plans to raise some $2.8 billion this year.
Finance Minister Kemi Adeosun also wants to lift the proportion of dollar debt to 40 percent from its current level of 27 percent, to replace expensive naira bonds with 10-year interest rates as high as 14 percent.
“Nigeria is focused on reducing the cost of our debt portfolio and ensuring we have the optimal mix of domestic and international debt,” she told Reuters.
“The proceeds of the dollar issuance ... will be used to re-finance domestic debt, which is high-cost and short-term, with lower-cost international debt with a longer tenure.”
Debt levels in the region are still low compared to many other parts of the world. Sub-Saharan Africa’s average public debt level surpassed 50 percent of GDP in 2017, according to The Institute of International Finance.
But there has been an explosion since 2005 when rich countries, for a second time in a decade, wrote off billions of dollars to help the continent out of its debt trap.
Part of the recent big run-up in debt levels came as commodity exporters such as Nigeria, Zambia or Angola were forced to fill the gaps in coffers left by a 75 percent slump in oil and some key metal prices between 2014 and 2015.
Combined with the related hit to growth rates, this triggered an outsized fall in sovereign credit ratings in the region which only now looks to be leveling off. S&P Global’s sub-Saharan Africa ratings have dropped around two notches on average since 2008 from BB- to B, whereas across all emerging markets the fall has been only about half a notch, from just above BBB- to just below. Moody’s downgrades in sub-Saharan Africa have outnumbered upgrades 21 to 2 since the beginning of 2015.
The region is not out of the woods. In 2017, at least three countries - Mozambique, Congo-Brazzaville and Chad - defaulted or tried to renegotiate debt. Angola announced it wanted to extend maturities in 2018.
But thanks to attractive yield offers, investor interest seems unabated. Nigeria’s $2.5 billion offering attracted bids in excess of $11 billion.

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Yields on Nigeria treasury drop after Eurobond sale

Yields on Nigerian short-dated debt decline by around 50 percent on Tuesday after the government announced pricing for $2.5 billion Eurobond meant to repay maturing treasury bills.

Investors are expected repayment of around 198 billion naira in maturing treasury bills as soon as the government is through with the Eurobond issuance process.

Once the government refinances its maturing debt with the proceeds of the Eurobond, the volume of treasury for the next quarter is expected to drop.

 Since last year, Finance minister Kemi Adeosun had announced government intention to refinance domestic debt with the foreign bond in order to cost of debt services.

The government has been working to lower its borrowing costs, particularly as inflation fell for the 12th time in a row in January. 

By November last year, the government paid off the maturing bills rather than rolling them over as it has done in the past.

Head of the Debt Mangement Office (DMO), Patience Oniha said the issuance of the $2.5 billion in Eurobond will enable Nigeria refinance a portion of its existing domestic debt portfolio, with external debt at considerably lower cost.

According to her, the impact of the process has already led to a reduction in the cost of domestic borrowing, and so a double benefit for the cost of our broader debt portfolio. Lower domestic rates will also benefit corporate borrowers.

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Maersk says to compete with UPS, Fedex after breaks up

A.P. Moller-Maersk plans to expand its transport and logistics business to compete directly with package delivery companies UPS and Fedex as part of a major restructuring, its chief executive said Tuesday.
Maersk, the world’s largest container shipping company, has sold off the majority of its energy assets to focus entirely on transport and logistics.
“We’re building this company that is a global integrated container business, a company very similar to UPS and Fedex,” CEO Soren Skou told investors at a capital markets day in Copenhagen on Tuesday.
“I hope they will be considered peers of ours, when we are done with this journey in 3-5 years,” he added.
As part of the restructuring, Maersk aims to expand its services to all parts of the supply chain, giving customers the ability to deal with one firm when shipping goods from one end of the world to another.
In a digitisation drive, Maersk has teamed up with IBM to create an industry-wide blockchain-based trading platform it says will allow it to offer more value-added services in areas like freight forwarding and trade finance.
In the biggest deal in breaking up the Maersk conglomerate, French oil major Total purchased the company’s North Sea-focused oil and gas business in August in a $7.5 billion deal.
Shares in Maersk were trading 3.7 percent lower at 10,495 Danish crowns at 1003 GMT, below the August level when the Total sale was announced and around same level as when it announced its new strategy in September 2016.

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Nigeria plans to sell assets recovered from looters to boost economy

President Mohammadu Buhari has said that all assets seized by the government in course of its anti-graft probes would to sell and proceeds to fund the budget and bolster the economy.

Many past government officials have been accused of looting the country's economy while in the office with billions of naira lost in the process. 

President Buhari was elected in 2015 in part on a promise to rid the country of graft.

In recent time, his government has focused on efforts to recover billions of naira stolen by the officials of the past administration.

Many properties have been recovered by the anti-graft agencies, including EFCC in the course of the fight against corruption.

“All mismanaged and misappropriated national assets recovered will be sold off and proceeds paid to the treasury for the benefit of the country,” he said, according to a statement from his spokesman.

The presidency statement did not say when the sales would happen, nor provide further details.

Very few officials from Buhari’s administration have so far been prosecuted despite frequent allegations against them.

Notable exceptions were his sacking last October of Nigeria’s most senior civil servant, Babachir Lawal, and the former head of the National Intelligence Agency for alleged involvement in corruption.

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Nigeria seeks sanction against foreign firms engaging in tax malpractice

Multinational companies operating in Nigeria and engaged in tax malpractices should be designated and treated as ‘foreign corrupt practices,’ Nigeria's minister of finance has said.

Kemi Adeosun told a conference on in New York tagged the Platform for Collaboration on Tax (PCT) that Nigeria was doubly affected by illicit financial flows as a result of corruption and tax evasion.

She requested global organisations such as the OECD, World Bank, IMF and United Nations to see the tax avoidance actions of multinational companies as corrupt practices.

“There is absolute need for a complete understanding of how these Multinational Corporations (MNCs) behave in Nigeria and developing countries, many operate a completely different standard in Africa to what obtains globally,” Adeosun said.

She lamented the capability of defaulting MNCs to hide behind slow legislative processes to avoid doing what was right in the nations from which they derived significant income.

The Minister, who disclosed that options to sue such companies in their own countries were being explored, said that the designation of tax crime as foreign corrupt practices would support such efforts.

The PCT is an initiative of the Organisation for Economic Cooperation and Development (OECD), World Bank Group, International Monetary Fund (IMF) and United Nations.

On the issue of illicit Financial Flows, the minister said Nigeria ‘taking strong action and was determined to reverse their impact’.

Africa's top economy, according to Adeosun is taking a number of measures internally and also taking full advantage of international initiatives to tackle the problem.
"Internal measures include tightening financial controls and surveillance, adoption of the National Tax Policy with its commitment to regular revisions of tax laws and the ongoing tax amnesty programme, the Voluntary Assets and Income Declaration Scheme (VAIDS),” are some of the steps being taken by the government to stem tax malpractices and illicit financial flows out of the country, she said.

She said Nigeria would use every available avenue to improve its revenue generation and tax collection and credited the United Nations with putting the issue of Illicit Financial Flows at the forefront of the fight against IFF.
She noted that that it was ‘entirely appropriate that we are discussing this issue in the United Nations Headquarters, as this is a United Nations sized problem’.
“The Nigerian Government is taking responsibility for preventing illicit flows but the range of measures used and the sheer volumes are such that the recipient nations must also take measures to discourage the flows into their countries by asking more questions,” Adeosun noted.

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Nigeria's banking regulator bars banks with huge NPLs from dividends payment

Nigeria's central bank has barred commercial lenders with large no-performing loans (NPL) and weak capital from paying dividends to shareholders as more listed companies released their year-end financials.

Sources said the central bank took the step to stem the rising incident of NPL and further erosion of capital base by such financial institutions.

Analysts said the regulatory bank directive could impact negatively on the performance of the stock market as many investors have taken positions ahead of the release of 2017 financial statements and accounts.

It was said that many of such investors had invested ahead of the year-end account to benefit from expected bounty dividends usually declared by banks at this period.

With the directive, many of the banks would not be able to meet their shareholders' expectation and could lead to the dumping of shares of such banks on the floor of the Nigerian stock exchange.

In the letter to the banks and discount houses, the banking sector regulator said it had observed that rather than grow their capital with retaining earnings, some banks were paying out a greater proportion of their profits, irrespective of their risk profile and the need to build resilience through adequate capital buffers.
The regulatory bank said any commercial lenders or discount houses with NPLs above 10 percent would not be allowed to declare dividends for their shareholder.

Nigeria has NPL threshold of five percent, which means any banks that exceeded the threshold is considered in danger.

As of September 2017, the banking industry’s average NPLs stood at 15.18 percent.
Total NPLs in the industry rose by 50 percent to 2.4 trillion from 1.6 trillion as at December 2016, according to data from the Nigeria Deposit Insurance Corporation (NDIC).
Also, the regulator said commercial lenders that failed to meet the regulator’s minimum Capital Adequacy Ratio, should not pay dividends to their shareholders.

“Globally, retained earnings have been identified as an important source of growing an institution’s capital. Advantages of retained earnings include being a source of long-term finance; being easier and cheaper to raise than external finance; curtailment of financial risks; and improving liquidity and profitability," the central bank said.
The central bank said it has been observed that rather than take advantage of this beneficial means of capital generation, some institutions pay out a greater proportion of their profits, irrespective of their risk profile and the need to build resilience through adequate capital buffer

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Nigeria's school enrollment, school feeding and corruption

Out of school enrollment drop in Nigeria primary school level from 10.5 million to 8.6 million across the country last year, according to statistics released by sources in the education ministry. 

This was a significant improvement considering growing poverty in the country and resistance to education in some part of the North. 

The increased in school enrollment at primary level coincides with the introduction of school feeding programme by the government in conjunction with some state governments.
Many parents who had hitherto failed to send their wards to school are reportedly having a change of mind and have decided to send their children to school because of the provision of a meal a day by the federal government in some schools across the country.

It was equally learnt that in many cases, some parents are withdrawing their children from private school to public school to enable them benefit from the free school feeding programme.
Ordinarily, the increased or rather the decreased in the out of schools enrollment should have been a cheering news as it portends improvement in the quality of life expectancy and the desire of the country to fight poverty through education. 

However, the very scheme that seems to have spurred the increase in school enrollment in some part of the country is gradually losing steam and may end up like any other government programme due to huge corruption and lack of commitment on the part of state governments to ensure the success of the scheme.
Reports from many of the states that are currently executing the programme showed a very dismal performance in the implementation of the programme and the quality of the food being served the children by the vendors due to funding challenges. 

Often time, the quality of the food was poor, inadequate and not sufficient to go round the supposedly pupils that they are meant for.
In some cases, the vendors employed by the government to supply food to the participating schools are being short-changed by the official of state education ministry in charge of disbursement, while those who are sent to supervise the process are not committed to carrying out their duty.
Recently, a video emerged on the social media on the poor nature of the food being served children participating in the free food scheme. 

The government has debunked to claims by some vendors that the scheme is laden with huge corruption and manipulations by officials in charge.
During the run-up to the 2015 general election, president Buhari and his party, APC promised to introduce national free feeding programme for pupils in primary schools across the nation. 

The programme was meant to encourage more out of school pupils to enroll in school, promote hygiene and reduce pressure on parents who could not provide their children adequate feeding
before sending them to school.
By 2016, after some initial delay and hiccups, the government kick-started the programme, first in seven states, then increased gradually to 17 states at the end of last year. The figure released by the government showed that so far, the government had disbursed over 6.2 billion naira to support 17 states to implement the National Home Growing School Feeding Programme.
While the programme was a welcome initiative to boost nutrition among children at the primary level, encourage productivity by farmers who are expected to supply the food and provide jobs for
vendors, the programme has been described as poorly thought out and implemented by the government.
A former president Olusegun Obasanjo had in a recent interview said the federal government should not have involved itself in the programme. Although, he lauded the initiative and progressive so far
made by the government, but proffered that states governments are better positioned to manage such programme.
Reports from some of the 17 states where the programme is being executed have shown that many of the states are diverting the fund disbursed for the programme to other use, while some of the officials
saddled with the implementation and supervision of the programme are equally engrossed in corruption activity that have reduced the impact of the programme on the targeted pupils.
Initially, many parents were happy to allow their wars enroll in school to enable them benefit from the programme and reduce the burden of feeding on their meager income, however, as the programme faltered, many of the parents have started withdrawing their children from the schools.
Analysts are calling for the suspension of the programme by the federal government until adequate preparation and strategy are designed to ensure successful implementations of the programme.
While the initiative was considered laudable, the government has been advised to enlist some NGOs or civil society group in the implementation to ensure that fund disbursed for the programme are used for that purpose.
Aside from the corruption that have bedecked the programme, many of the states are not buoyant enough to provide the counterpart funding for the programme and as such the amount provided by the
federal government was insufficient to provide a balance and adequate feeding for the pupils.
The critical question to ask is that was the federal government well equipped to carry out such programme considering the state of education in the country? Both primary and secondary education
falls under the purview of the states and local governments, while the tertiary education is on the concurrent list.

There are suggestions that the federal government should focus on providing adequate infrastructure to make learning conducive across the country rather than striving to provide free feeding to pupils who may never get the food at the end of the day.
Government is also advised to devise other measure to reduce poverty in the country by providing incentives for job creation to empower parents to take care of the feeding needs of their children
rather than a feeding scheme marred by corruption embedded in the government system.
Many of the schools where the programme is been implemented lack basic facilities for a conducive learning process while many of the pupils targeted in the feeding lack books, uniform and even the
school lack enough teachers to teach. 

These are major issues that needed to be tackled first if the government is serious about encouraging increase enrollment of out of school children.
Also, many of the school across the states lack basic infrastructures such as classroom, teaching aids and quality textbooks.
Most of the children who are out of school are mainly the children of the poor and government should focus more on alleviating poverty in the country to reduce its negative impact on children of school age.
Many of the children have to trek long distance to enable them to attend school because the government could not provide school within the some areas remain a big challenge to boost enrollment in school.

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Obasanjo, Jonathan team up against President Buhari ahead of 2019

As the campaign for the 2019 general election gradually and subtly gathers momentum across the country, former President Olusegun Obasanjo has linked up with his repentant protege ex-president Goodluck Jonathan in what policial observers said was a grand coalition against the present government of President Muhammadu Buhari.

Obasanjo was at the home of Jonathan in Bayelsa State over the weekend in a fresh rapprochement ahead of the general election and realisation of the move to force President Buhari into premature retirement in 2019.

The meeting between the ex-presidents Obasanjo and Jonathan took place at the same time President Buhari hosted his ruling party governors in his home state, Kastina in preparation for the next general election.

Although President Buhari is yet to personally announce his intention to seek re-election for a second term in 2019, the secretary to the federal government and other party leaders have at one time or the other proclaimed the president readiness to contest for a second term in office.

In a recent letter, Obasanjo had appealed to president Buhari not to seek re-election for a second term as a result of his failure to meet the aspiration of Nigerians who voted overwhelmingly for him in 2015 against his protege, Jonathan.

The ex-president also accused Buhari of clannishness and nepotism in his appointment of top government officials, while he criticised him for failing to address the urgent security challenges in the country.

Although details of the meeting between Obasanjo and Jonathan was not made open, sources said it may be the beginning of a move to strengthen opposition against the government of Buhari ahead of the next election.

Already, some of the allies of Obasanjo had formed what they called Coalition for Nigeria Moment, however, political observers said for the coalition to really be taken seriously they must anchor their campaign on the vibrant national issues while aligning with a political party to realise their objective of grabbing power.

PDP remains the country's main opposition party and a viable alternative and platform to use to remove the president in the forthcoming election.

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Nigeria collaborates with W/bank, others to halt illicit financial outflow

Nigeria is collaborating with global organisations to curtail financial flows through the continent as Africa economy bleeds with an average loss of about $80 billion through the illicit cash flight.

A high-level collaboration between Nigeria on one hand and the Organisation for Economic Cooperation and Development (OECD) and the World Bank Group and other African countries is being worked out.

This was a major resolution reached at the ongoing Platform for Collaboration on Tax (PCT) Conference at the United Nations in New York.

According to the head of OECD Global Forum on Exchange of Information, Monica Bhatia, automatic information sharing had been adopted as part of proactive steps to curtail the IFFs from the African continent to developed countries.
“The Sustainable Development Goals (SDGs) specifically says that we must significantly reduce illicit financial flows by the year 2030. A lot of efforts are ongoing to achieve this and support developing countries to end the IFFs,” Bhatia said.
Nigeria’s Minister of Finance, Mrs. Kemi Adeosun, in her address at the conference, affirmed that the IFF was a problem that urgently requires global focus and actions towards the realisation of significant developmental progress for Nigeria and other developing countries.
“The IFFs are driven by the desire to hide illicit wealth, hide the proceeds away from the public eye and law enforcement agencies and also conceal the ways and means by which illicit wealth was created. This makes it difficult to trace the associated money flow," Adeosun said.

She said “Developing countries, including Nigeria, collect significantly lower levels of tax, as a percentage of Gross Domestic Product (GDP), than wealthier States. This is partly because the income and wealth being created is taken out of the country illegally, without being taxed.”

Quoting the report of former South African President Mbeki’s High-Level Panel on IFFs, the Minister said Africa loses $80 billion annually to IFFs, with a significant percentage of the loss coming from Nigeria.
She disclosed that the Nigerian Government had engaged a leading international Asset Tracing and Investigation Agency (Kroll), to trace and track illicit flows and assets.
In addition, she said Nigeria had signed the Multilateral Competent Authority on Common Reporting Standards, which allows for the exchange of financial account information.
The country, according to her, is expected to effect the first exchange by 2019 as soon as the domestic legal framework was completed.

“Furthermore, as part of open government partnership, Nigeria has included in the national action plan a commitment to establish a public register of beneficial owners. To this end, the Corporate Affairs Commission, the custodian of Nigeria's company registry, is pursuing relevant amendments to the Companies and Allied Matters Act to comply with global standards.”

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World Bank supports Nigeria's power sector with $486 mln credit

The World Bank has approved a $486 million credit facility to Nigeria for electricity grid improvements, the lender said on Friday.
“The investments under the Nigeria Electricity Transmission Project will increase the power transfer capacity of the transmission network and enable distribution companies to supply consumers with additional power,” the World Bank said.
Nigeria’s dilapidated power sector is often criticised by economists for holding back the country’s economic growth. 

Businesses and households are subject to frequent blackouts, and many depend on their own generators that are expensive to run.

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Nigeria's Dangote Cement moves to raise $1 bln via London IPO

Nigeria's Dangote Cement, owned by Africa’s richest man, may have revived its plans to raise $1 billion through a share sale in London that, Bloomberg report has indicated, quoting people familiar with the matter.

The cement firm, majority owned by Aliko Dangote, is said to have approached investment bankers to discuss a potential United Kingdom listing.

Once banks have been appointed, it will probably take at least five months to complete the process, one of the people said. 

The cement maker, with extensive subsidiaries in some part of the continent and Nepal is also considering issuing a debut Eurobond, according to two different people familiar with the matter.
Discussions are ongoing and a listing of Africa’s biggest cement maker may not go ahead, the people said.
“We have not, to the best of my knowledge, taken such a decision,” Anthony Chiejina, Dangote Cement’s spokesman in Lagos, said in an emailed response to questions, without commenting on the banker talks.
Fresh capital would enable Dangote Cement to fund expansion plans in sub-Saharan Africa and comply with a demand from the Lagos bourse that listed companies should have a free float of at least 20 percent, regardless of where the shares are traded. 

The company sees London as a more favorable place to attract about $1 billion than in its home base of Lagos, Nigeria’s commercial capital, where no company has raised more than Starcomms Plc’s $796 million in 2008.
Dangote Cement, which has a Lagos free float of 8.9 percent and a market valuation of $12.2 billion, mulled raising equity in London in 2010. 

At the time, Goldman Sachs Group Inc., JPMorgan Chase & Co., and Morgan Stanley helped it prepare a sale that could have raised as much as $5 billion before the move was aborted.
The revival of the plan comes as Dangote Cement shares climb to near records as the Nigerian economy recovers from a downturn caused by the 2014 slump in oil prices. The economy of Africa’s most populous nation went into recession in 2016 as government revenue plunged. 

Nigerian stocks are up 11 percent this year in dollar terms, the sixth best performance globally according to data compiled by Bloomberg.
Aliko Dangote has a net worth of $13.5 billion, according to the Bloomberg Billionaires Index. His Dangote Industries Ltd. conglomerate has interests in sugar, flour, and packaged food as well as controlling the cement company. 

The 60-year-old has repeatedly expressed a desire to bid for London’s Arsenal Football Club and is building a 650,000 barrel-a-day oil refinery near Lagos, which will cost more than $10 billion.

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