Mr. Tope Smart
Chairman
Nigerian Insurers Association (NIA)
Mr. Tope Smart, Group Managing Director/CEO of NEM Insurance Plc was yesterday elected the 23rd Chairman of the Nigerian Insurers Association (NIA) at its 47th Annual General Meeting (AGM) in Lagos.
L-R: Past Chairman, Nigerian Insurers Association (NIA), Ven Ladipo Ajayi; past Chairman, NIA, Mr Godwin Wiggle; Commissioner for Insurance, National Insurance Commission, Alhaji Mohammed Kari; New NIA Chairman, Mr. Tope Smart; his predecessor, Mr. Eddie Efekoha; a past Chairman, Mr. Wole Oshin, and a past Chairman, NIA, Oye Hassan-Odukale.
In his acceptance speech, Smart said he would adopt a policy of ‘Insurance First’ to lift the business and image of insurance in Nigeria, as well as protect the corporate interest of member companies of the NIA.
“My agenda would be anchored on the basis of Insurance First and NIA First. I promise to lift the image and business of insurance in Nigeria to the next level. We need to leverage on the experience of the industry to achieve the necessary result as well as collaborate with other arms of the insurance industry and relevant stakeholders outside the industry to move our market forward.”
Mr. Tope Smart Chairman Nigerian Insurers Association (NIA)
He thanked the Council members of the NIA and the entire insurance industry for giving him the opportunity to lead the Association and the insurance sector in Nigeria. He solicited the support of the industry and other bodies outside the sector to ensure sustainable growth of insurance business in the country.
The new NIA chairman promised to unveil his comprehensive agenda during his formal investiture in the coming weeks.
The NIA is the umbrella body of insurance companies operating in Nigeria.
The 2018 Careers in Africa Employer of Choice Survey has ranked the African Development Bank the fourth best company to work with in Africa. Of 100 companies listed, the top four include the World Bank Group, Chevron, Exxon Mobil and the African Development Bank.
Over 20,000 African professionals answered questions about employee engagement and employment conditions. Opportunities to learn new skills, quality of healthcare provisions, leadership and opportunities for advancement emerged as key indicators of great employers.
Commenting on the African Development Bank ranking, Alex Mugan, Managing Director of the Global Career Company and co-author of the survey with UK-based firm Willis Towers Watson said: “The importance of making a positive impact came through strongly in responses to the Study. This, together with the on-going organisational transformation at the African Development Bank, explains the continued high esteem in which the Bank (as an employer) is viewed by many African professionals worldwide.”
Trust in senior leadership, especially leaders that listen, those who set a good ethical example, and who deliver the values of the business, emerged as the top three most important factors in choosing an employer in Africa. “Employees are interested in leaders that push a good mission. Brands whose leaders are very visible doing those things have tended to do well,” Mugan further indicated.
According to Akinwunmi Adesina, President of the Bank, “the ranking is further validation of the work of the Board and Management to accelerate critically needed institutional changes and efforts to attract the best and the brightest to help implement the Bank’s High-5 agenda to Power Africa, Feed Africa, Industrialize Africa, Integrate Africa, and Improve the quality of life of Africans.”
The Bank scored high in attracting top talents from across all Africa. It also retained its position in the top 5 of established corporate and multilateral organizations.
The report highlights a shift in the talent landscape with an increased interest in investment finance from job seekers and a quest for digital savvy experts from employers.
Overall, the survey revealed that job security is considered one of the main reasons to remain in an organization. In addition to attraction drivers for men, including skills development, the Report suggests that female professionals have a greater interest in healthcare opportunities, flexible working conditions, work-life balance, and ethics.
More than just a listing, the report seeks to shape the conversation around what makes a great employer in Africa, and through that positively change employee experience across the continent.
The 100-list includes banks, oil companies, FMCG brands and mobile phone operators.
Global and African financial heads identified country risk as the biggest challenge to their ability to lend more to African countries. Speaking in Abidjan during a one-day forum on investment risks in Africa hosted by the African Trade Insurance Agency (ATI), experts acknowledged that the abundance of current liquidity in the market did nothing to alleviate the capacity constraints faced by most banks when doing business in Africa.
Lenders are bound by regulations that prevent them from lending significant amounts to sub-investment grade sovereigns, which is the case for most African countries. Institutions such as ATI that can offer investment insurance can help to mitigate the risks and thereby bring added lending and investment capacity to African markets. Without an increased ceiling in limits, international lenders will continue to be constrained on the amounts they are able to lend both at the sovereign and corporate levels.
Experts attending the forum also noted positive movements in countries such as Ghana and Senegal for instance, which were recently put on positive watch by the rating agency S&P. This was largely based on the dividends anticipated from key infrastructure developments and investor-friendly policies. In Senegal, for example, the country has restructured its commercial laws, implemented a Public Private Partnership law that ensures all signed public contracts in the oil and gas sector are published and created a department of competition tasked with working hand in hand with investors.
Risk analysis experts at the conference cited Botswana, Côte d’Ivoire, Ethiopia, Rwanda and Zimbabwe as countries to watch in the coming months based on strong reserves in Botswana, political transitions in the case of Ethiopia and Zimbabwe, a strategy to transform its economy into a services hub in the case of Rwanda, and creating an enabling environment to attract investors in the case of Côte d’Ivoire.
Most government representatives at the meeting also noted their countries efforts to ramp up value addition in the agriculture sector along with an emphasis on removing barriers to trade within the continent. Jean-Louis Ekra, the former President of Afreximbank observed that Africa is in fact moving in a different direction than the current protectionist tendencies of Western countries. In contrast, Africa is uniting under the banner of the African Continental Free Trade Area, which will become the world’s largest trade area.
While participants agreed that the risk perception in Africa is typically greater than the on-the-ground reality, they also recognized that making Africa less risky would require a concerted focus aimed at improving the overall business environment in order to address the risks that do exist. According to a recent Moody’s report, 40 to 50% of defaults in developing markets are directly linked to country risks. During the forum, panellists discussed low-cost solutions that could help countries reduce their risk including ensuring fair adherence to existing regulations. “One of our roles at ATI is to educate governments to make them aware of the elements that international investors consider in their assessment of country risks. If countries are made aware that any drastic changes they make to legislation, for instance, could be a key political risk factor, they may make better choices and create more fertile environments for the private sector,” commented John Lentaigne, ATI’s Chief Underwriting Officer. He added that “a stable investment climate can be demonstrably and directly linked to growth.”
Despite Africa’s perceived risks, ECGC, India’s export credit agency and international broker, BPL Global, who have a combined USD142 billion worth of exposures, noted a relatively low claims and reasonable recovery experience in Africa. Out of BPL’s USD42 billion in current exposures which is insured with international investment risk providers 8 billion of this exposure is in Africa, where the company has historically recorded USD230 million in claims of which USD123 million has subsequently been recovered.
International lenders and insurers commented on the importance of ATI’s participation to make projects bankable through its preferred creditor status and relationships with African governments. This was seen as ATI’s core value proposition.
In his address to participants, Pierre Guislain the Vice-President responsible for Private Sector, Infrastructure and Industrialization of the African Development Bank noted the Bank’s commitment to transform the relationship with ATI into a strategic partnership that can leverage its reach and help countries accelerate regional integration.
ATI, a multilateral investment and trade credit insurer posted record results in 2017 for the sixth consecutive year with USD10 million in profits representing a 55% increase over 2016 and USD2.4 billion in gross exposures.
The bearish sentiment persisted in the local bourse yesterday as declines in market bellwethers – DANGCEM (-2.2%) and GUARANTY (-1.6%) – pulled the All NSE All Share Index (ASI) 0.6% lower to 37,733.44 points while YTD loss deteriorated to 1.3%. Hence, investors lost N88.5bn as market capitalization fell to N13.7tn.
However, activity level improved as volume and value traded rose 11.5% and 40.0% to 414.9m units and N4.5bn respectively. Top traded stocks by volume was CHAMPION (140.4m), STERLING (47.8m) and ZENITH (26.2m) while GUARANTY (N921.6m), ZENITH (N651.8m) and DANGCEM (N599.5m) were the most traded stocks by value.
Largely Bullish Sector Performance
The performance across sectors was largely bullish as 3 of 5 indices trended northwards.
The Industrial Goods, Consumer Goods and Insurance indices were yesterday’s gainers, up 1.4%, 0.5% and 0.2% respectively, buoyed by bargain hunting in INTBREW (+3.3%),WAPCO (+5.0%), UNILEVER (+2.5%) and NIGERIANBREWERIES (+0.5%). On the flipside, the Banking index was the sole loser, shedding 0.7% on the back of sell-offs in GUARANTY (-1.6%), ZENITH (-0.4%) and DIAMOND (-3.5%).
The Oil & Gas index closed flat, halting its six days of consecutive losses.
Investor Sentiment Strengthens
Investor sentiment as shown by market breadth (advance/decline ratio) strengthened to 0.8x from 0.3x recorded yesterday as 16 stocks advanced against 20 decliners.
Yesterday’s top advancers were HONYFLOUR (+9.5%), LAWUNION (+9.3%) and AIICO (+5.0%) while EQUITYASSURE (-4.5%), WEMA (-4.1%) and DIAMOND (-3.5%) were the worst performers.
Given the largely bullish sector performance and improved investor sentiment, we see an opportunity for a market rebound in the last trading day of the week.
BudgIT is currently conducting its #StateofStates campaign which examines the level of transparency in the 36 Nigerian States. In its online assessment on the availability of public finance documents in State government domains, we observed that as at June 20, 2018, only 15 States in the country had published their budget documents online.
BudgIT, a civic tech transparency organisation working on holding government accountable and creating an active citizenry to improve governance is following the non-availability of States fiscal plan and urging Nigerians to demand their States budgets collectively.
Following this call, we were able to obtain fifteen (15) State budget documents for 2018. The States are Borno, Delta, Edo, Ekiti, Gombe, Kaduna, Kano, Katsina, Kogi, Kwara, Lagos, Nasarawa, Ondo, Plateau and Yobe.
It is instructive to note that only 13 States (Borno, Delta Edo, Ekiti, Gombe, Kaduna, Kano, Katsina, Kogi, Nasarawa, Ondo, Plateau and Yobe) of the 15 States are sufficiently detailed while Lagos and Kwara States provided a summary of their budgets on the government websites.
The document provided lacks actionable detail with which citizens can hold their elected officials to account. The organisation says it would like to state explicitly that Lagos and Kwara States have a history of opacity over the years and are notorious for resisting attempts by citizens to pry into the affairs of the state.
Shrouding public finance information in secrecy thereby encourages corruption and mediocre performance in the States.
The #StateofStates advocacy continues to critically look at the proactiveness in the disclosure of information in the Nigerian States and their compliance with the Freedom of Information law where applied. Transparency in the States continues the downward swing as governments persist in denying citizens the access to relevant information.
It is commendable that the States released full budget documents to the public, but it must be published within a reasonable timeframe. The proposed budget details presented to the State House of Assembly should be made available to the public to enable them to engage their Legislators during the budget debate. Any State keen on citizen participation in governance should publish full details of the proposal with 48 hours of submission to the legislature.
The fundamental requirement of good governance is transparency, and the least form of transparency is the availability of public finance information.
Abayomi Akinbo, BudgIT Project Manager, observed:”Information on government spending from the public purse should be provided to the people by the government through various communication channels; one of which is the official state website. However, this is not the case with State governments in Nigeria.”
The organisation states: “Beyond the release of pictures and stories of projects executed, it is vital that citizens are informed of project cost to enable them to decide if the project delivered optimum value for money spent. Nigeria battles the current scourge of corruption due to the prevailing practice of opacity at federal, state and local levels. No country achieves transparency and accountability without the active participation of citizens in the management of its resources. Taxpayers must hold government accountable to enable them to enjoy the dividends of democracy.
We call on the people of the States of (Abia, Akwa Ibom, Adamawa, Anambra, Bauchi, Bayelsa, Benue, Cross River, Enugu, Gombe, Imo, Jigawa, Kebbi, Niger, Ogun, Osun, Oyo, Rivers, Sokoto, Taraba, and Zamfara ) to demand their budgets be made open and accessible to ensure the society works in their interest. We equally call on all Nigerian citizens to keep an eye on the funds and follow the money. Across the world, transparency has been noted to foster citizens trust in government and increasing investor confidence. States with partially detailed budgets documents in public domains must provide details of capital projects being executed for the fiscal year.”
The Board of Directors, Linkage Assurance Plc has named Daniel Braie Acting Managing Director/Chief Executive Officer of the Company. He takes over from Dr. Pius Apere whose appointment with the company ended 21st June 2018.
The decision follows an emergency board meeting held on the 21st June 2018.
In a statement made available to regulatory authorities, the decision was taken in line with the Articles of Association of the Company and the employment contract of the Managing Director.
Braie will be in charge of the management of the Company pending the appointment and confirmation of substantive Managing Director.
The negative performance of the local bourse was sustained in yesterday’s session as the NSE All Share Index (ASI) fell 10bps to 37,963.93 points while YTD loss remained at -0.7%.
Profit taking in ZENITH (-2.0%), GUARANTY (-0.7%) and INTBREW (-0.7%) pulled the benchmark index lower. Conversely, investors gained N9.7bn as market capitalization rose to N13.8tn. Similarly, activity level improved as volume and value traded increased 43.9% and 0.4% to 372.2m units and N3.2bn respectively.
The most traded stocks by volume were STERLING (172.6m), ZENITH (31.5m) and TRANSCORP (22.9m) while ZENITH (N792.7m), PRESCO (N404.4m) and GUINNESS (N277.9m) were the top traded stocks by value.
Negative Sector Performance
Across sectors, performance was largely bearish as 3 of 5 indices trended southwards.
The Insurance and Banking indices led laggards, down 0.8% and 0.6% respectively as a result of losses in NEM (-1.2%), REGALINS (-4.0%), ZENITH (-2.0%) and GUARANTY (-0.7%).
The Consumer Goods index also closed in the red, shedding 0.2% on the back of sell-offs in INTBREW (-0.7%). On the other hand, the Industrial Goods and Oil & Gas indices advanced 0.9% and 0.3% respectively following gains in WAPCO (+2.4%) and TOTAL (+3.7%) which offset losses in SEPLAT (-0.2%).
Investor Sentiment Dwindles
Investor sentiment as shown by market breadth (advance/decline ratio) weakened to 0.3x from 1.0x in the prior session as 12 stocks advanced compared to 35 decliners.
Yesterday’s top gainers were CILEASING (+4.7%), UNITY (+4.5%) and TRANSCORP (+4.4%) while JAPAULOIL (-7.3%), ETERNA (-5.0%) and FIRSTALUM (-5.0%) were the worst performers.
Given the softer investor sentiment, we believe the negative performance will be sustained in tomorrow’s trading session.
Nevertheless, we do not rule out the possibility of some bargain hunting in market bellwethers by the end of the week.
“Innovation has potential to significantly contribute to addressing urgent development challenges in Nigeria; from youth unemployment and inequality to enhancing efficiency in the delivery of public services,” stated Samuel Bwalya, UNDP Nigeria Country Director at the signing ceremony of a Memorandum of Understanding (MoU) with the Civic Foundation for Innovation.
The two institutions entered into the agreement as an expression of interest to work together and promote innovation in designing solutions for the country’s development challenges.
The MoU was signed by Mr. Bwalya and Mr. Mosope Olaosebikan, Founder of Civic Foundation for Innovation on June 26, 2018 at UNDP offices in the presence staff of both organisations.
The two organisations intend to work together in promoting innovation activities especially among the youth – within the context of UNDP’s flagship initiative, the Youth Employability, Innovation and Entrepreneurship Programme.
This programme is aimed at promoting innovation and entrepreneurship as key drivers of economic growth, productivity and employment. With over 40% of youths in Nigeria unemployed, the programme also aims at enhancing their skill levels so that they are employable.
As the lead agency is supporting the Government of Nigeria in implementing the Sustainable Development Goals (SDGs), UNDP Nigeria intends to work with the Civic Foundation for Innovation in promoting innovation in the implementation of the SDGs at both Federal and State levels at which different ideas with potential to accelerate and/or contribute to governments efforts aimed at keeping the country’s SDGs promise will be explored.
With numerous challenges faced by startups in turning their ideas into viable businesses, the two institutions will also work together in identifying and promoting access to innovative sources of finance for innovations and commercialization of inventions. Additionally, efforts will be made aimed at strengthening capacities of the startups, innovation hubs and innovators across the country.
Speaking during the signing ceremony, Mr. Bwalya pointed out that he was looking forward to seeing the country’s youth come forward with ideas that will help address the numerous challenges Nigeria continued to face.
“There are millions of creative minds out there; they need support in turning their ideas into solutions and viable businesses,” he emphasized. Mr. Olaosebikan added that since its establishment, his organisation had undertaken several activities that that helped strengthen the startup ecosystem and that a partnership with UNDP will significantly enhance the national momentum aimed at moving the innovation agenda forward.
The two organisations also agreed to hold Annual Innovation Awards to recognise innovative ideas with potential to help address the country’s challenges.
L-R: Director General, Nigerian Insurers’ Association (NIA), Mrs. Yetunde Ilori; Chairman, NIA, Mr Eddie Efekoha, and Head, Corporate Affairs, Mr. Davis Iyasere, during a press briefing on the activities of the Association yesterday in Lagos.
Operators in the Nigerian insurance sector have been granted N1 billion tax refund by the authorities over the 2007 recapitalisation exercise in the sector.
Mr. Eddie Efekoha, Chairman, Nigerian Insurers Association (NIA) said in Lagos yesterday that following widespread complaints from operators that they were over-taxed during the consolidation exercise initiated by the National Insurance Commission (NAICOM) in 2007, the industry body made spirited representations to the appropriate authorities in the country for a refund. He said member companies of the industry have duly received a tax refund of almost N1 billion.
Efekoha said the refund notwithstanding, the NIA is still engaging with the Federal Inland Revenue Service (FIRS) and the Federal Ministry of Finance to effectively redress the tax burden on the insurance industry to ensure sustainable growth of the sector.
L-R: Director General, Nigerian Insurers’ Association (NIA), Mrs. Yetunde Ilori; Chairman, NIA, Mr Eddie Efekoha, and Head, Corporate Affairs, Mr. Davis Iyasere, during a press briefing on the activities of the Association yesterday in Lagos.
Giving account of his two-year chairmanship of the NIA, Efekoha described the commencement of work on the NIA Tower as the high point of his stewardship.
Efekoha said: “I am delighted that the NIA Tower project has moved from discussion to actual construction. That development represents the high point of my chairmanship of the NIA. Tax has been an issue in our industry but we continue to engage the FIRS and the Federal Ministry of Finance to work out an amicable solution to spur robust growth of our industry.”
The NIA chairman, who is also the chief executive of Consolidated Hallmark Insurance Plc, said the industry is currently expecting the harmonised 10-year Transformation Agenda (2017-2027) from NAICOM to spearhead long-term growth of the insurance sector in Nigeria.
He thanked members of the media for supporting his agenda in the two-year period of his chairmanship of the NIA.
L-R: Davis Iyasere of NIA; Uju Ndubuisi Chukwu, Deputy Director General, Chartered Insurance Institute of Nigeria (CIIN); Richard Borokini, Director-General, CIIN/member, 2018 National Insurance Conference Committee; Femi Hassan, Chairman of Committee; Muftau Oyegunle, member; Ekeoma Ezeibe, member, and Mr. Rotimi Edumni, during a press briefing on forth coming National Insurance Conference yesterday in Lagos.
Professor Yemi Osinbajo, Vice-President, Federal Republic of Nigeria is expected to declare the 2018 National Insurance Conference open on Monday, July 9 at Transcorp Hilton Hotel, Abuja.
The theme of the conference is: Insurance Industry and Financial Inclusion.
Alhaji Femi Hassan, Chairman, Planning Committee of the National Insurance Conference (NIC) said the 2018 Conference is being organised to further underscore the commitment of the Nigerian insurance industry to continually upscale the knowledge of insurance operators, other professionals in the financial services sector as well as other stakeholders about contemporary dynamics in the economic development of the country. He added that the Conference would also highlight the enabling roles of the insurance industry in achieving financial inclusion and by so doing, accelerate its contributions to Nigeria’s Gross Domestic Product (GDP).
L-R: Davis Iyasere of NIA; Uju Ndubuisi Chukwu, Deputy Director General, Chartered Insurance Institute of Nigeria (CIIN); Richard Borokini, Director-General, CIIN/member, 2018 National Insurance Conference Committee; Femi Hassan, Chairman of Committee; Muftau Oyegunle, member; Ekeoma Ezeibe, member, and Mr. Rotimi Edumni, during a press briefing on forth coming National Insurance Conference yesterday in Lagos.
Hassan said: “The fact that access to financial services is concentrated in urban areas has limited the people from the rural areas from contributing maximally to growth and development of the nation’s economy. It is therefore instructive to state that the theme of this year’s Conference: INSURANCEINDUSTRY AND FINANCIAL INCLUSION is quite apt, in view of the policy direction of government towards including all segments of the society within the financial safety net. As at 2012, according to a survey by the Enhancing Financial Innovation and Access (EFInA), about 39.7% or 34.9 million adult Nigerians were excluded from financial services. While various innovative services have disrupted the financial world by including more participants in the money sector, there is still an untapped portion of the world population that remains unbanked or under-banked, uninsured or under-insured.
It is noteworthy that the selection of the Conference theme is fitting into the Insurance Industry Consultative Council’s plans in deepening reforms, completing and implementing pending initiatives, engaging with the public and validating completed reforms that would kick off medium term reforms.”
This edition of the conference is the fourth in the series to be held since its conception by the Insurance Industry Consultative Council (IICC) which is the umbrella organisation for all insurance institutions in Nigeria.
It is made up of the regulatory body for all insurance practice in Nigeria, National Insurance Commission (NAICOM); The professional body for insurance practitioners, Chartered Insurance Institute of Nigeria (CIIN); The three trade associations: for underwriters, Nigerian Insurers Association (NIA); brokers, Nigerian Council of Registered Insurance Brokers (NCRIB); and loss adjusters, Institute of Loss Adjusters of Nigeria (ILAN).
The IICC which was inaugurated on the 13th of August 2013 has been the unifying voice and point of reference for everything insurance in Nigeria.
The National Insurance Conference is one of those established channels aimed at fostering intellectual and professional development of insurance practitioners and further creating a platform for networking and exchange of ideas between industry operators and critical stakeholders in the nation’s economy.
L-R: Prof. Akpan Ekpo, Director-General, West African Institute for Financial and Economic Management; Engr. Edoyemi Ogoh, Head, Interconnect and Network Monitoring/Quality of Service Unit, Nigerian Communications Commission (NCC); Engr. Ernest Ndukwe, Chairman, Open Media Group/former Executive Vice-Chairman, NCC; Prince Cookey, Publisher/CEO of Business Journal; Mr. Tope Smart, Group Managing Director/CEO, NEM Insurance Plc and Chidi Izuwah, Director-General, Infrastructure Concession Regulatory Commission, at the Business Journal 10th anniversary lecture and awards on Infrastructure and Economic Growth: Exploring The Strategic Alliance held at Sheraton Hotel, Ikeja (Lagos) on Thursday, June 7, 2018.
The text of the paper presented by Mr. Tope Smart, Group Managing Director/CEO, NEM Insurance Plc at the Business Journal 10th Anniversary Lecture in Lagos.
The economic growth of a nation depends largely on a number of factors among which is the level of her infrastructural development. Other factors such as macroeconomic environment, technological development, market size are very important, but the importance of infrastructure factor as a tool for economic growth is determined mainly by the quality of roads, railway, air transport and electricity supply to mention but a few.
A research once carried out by Fourie in 2006, classified infrastructure into two major levels i.e high level and low level. According to him, high level includes roads, highways, railways, airports, electricity, water, sewage and telecommunications, while low level includes schools, hospitals, parks, courts, museums, theatres, libraries, universities, hospitals, etc.
L-R: Prof. Akpan Ekpo, Director-General, West African Institute for Financial and Economic Management; Engr. Edoyemi Ogoh, Head, Interconnect and Network Monitoring/Quality of Service Unit, Nigerian Communications Commission (NCC); Engr. Ernest Ndukwe, Chairman, Open Media Group/former Executive Vice-Chairman, NCC; Prince Cookey, Publisher/CEO of Business Journal; Mr. Tope Smart, Group Managing Director/CEO, NEM Insurance Plc and Chidi Izuwah, Director-General, Infrastructure Concession Regulatory Commission, at the Business Journal 10th anniversary lecture and awards on Infrastructure and Economic Growth: Exploring The Strategic Alliance held at Sheraton Hotel, Ikeja (Lagos) on Thursday, June 7, 2018.
All these are referred to as physical infrastructure or infrastructure capital.
Physical infrastructure can also be referred to as public infrastructure because it creates benefits for a large number of users.
Therefore, infrastructure services such as energy, transport, telecommunications, provision of water, sanitation and safe disposal of waste are fundamental to all kinds of household activities and economic production. With the analysis above, we can see that infrastructure is a long term, capital intensive asset with a long life cycle.
A research conducted by Aschavier in 1989 revealed that productivity growth fell sharply in response to a reduction in public investment. Therefore, infrastructure is an important component of economic activity. According to Dixon (1995), efficient infrastructure supports economic growth, improves quality of life and it is important for natural security.
Advantages
Investment in infrastructure can stimulate organisational and management changes.
Public infrastructure provides the geographic concentration of economic resources and wider and deeper markets for output and employment.
Public infrastructure is generally seen as a foundation on which to build the economy, e.g the development of infrastructure is one of the most important aspects for sustainable socio- economic development of a country.
Economic Growth Definition
A research conducted by Aschaer in 1995 confirmed that public infrastructure is the basis of quality of life; for example, good roads reduce the number of accidents and increase public safety; water supply system reduces the level of disease; waste management improves the health of the environment. Also, social capital infrastructure has a significant positive impact on earnings.
Having looked at infrastructure, we shall now examine economic growth.
Economic growth simply put implies increase in per capital Gross Domestic Product (GDP). It is an increase in the production of goods and services over a specific period.
Economic growth leads to business expansion. This leads to more jobs being created which consequently leads to higher demand for goods and services.
In Nigeria for instance, the Nigerian Bureau of Statistics reported that the economy recorded a GDP growth of 1.95% for the first quarter of 2018 as against 2.11% recorded during the last quarter of 2017.
The linkage between infrastructure and economic growth derives from the following factors:-
Output of infrastructure sectors such as power, water transport
e.t.c are used as inputs for production in the directly productive sectors e.g agriculture, manufacturing e.t.c. Insufficient availability of the former results in sub optimal utilization of assets in the latter., and this can affect the economic growth or otherwise of a nation.
Infrastructure development such as transport improves productivity significantly.
iii. Infrastructure provides the key to modern technology in practically all sectors
Thus, given the type of linkage, infrastructural development is important not only for economic growth but also for poverty reduction.
Secondly, the backward linkage between economic growth and infrastructure derives from the following:-
Growth in turn makes more demands on infrastructure.
Studies have indicated that with a 20% increase in public investment in infrastructure, Government can accelerate real growth by 1.8% points in the medium to long term i.e 6-10 years. This is further estimated to accompany a 0.2% decline in inflation rate.
Having looked at the linkage between infrastructure and economic growth, it is now convenient to relate these issues to the concept of insurance.
Concept of Insurance
Insurance hinges on the concept of Risk and risk is present in every activity of human life.
Insurance is the backbone of any economy because of the basic role it plays which is to restore someone, firm, government to the position it was before the occurrence of an insured peril. For a consideration (premium) insurance ensures the continuity of an enterprise notwithstanding the occurrence of an unforeseen event.
Channels of Promotion of Economic Growth
Generally speaking, Insurance Industry promotes economic growth and structural development through the following channels:
Offer protection to firms and organizations – in this way, their financial stability is enhanced by the insurance company taking over any damage or interruption in the production process occurring as a result of the insured events.
Promoting entrepreneurial attitude, encouraging investment innovation and the vitality of the market.
3. Offer relieve and by so doing reduce pressure on government.
4. Increasing financial intermediation through the creation of liquidity and savings through life insurance products.
Promotion of risk prevention, thereby contributing to sustainable and responsible development.
Insurance, through life insurance companies provide funds for long-term investment in the real economy.
In the absence of a risk transfer mechanism like insurance, economic activities would be much lower and hence will result in economic loss. This is the view of Golher (1991).
8. Insurance also helps to smooth out the volatile economic condition.
Also, in the absence of insurance, human behaviour, particularly risk aversion would either lead towards avoiding these activities or excessive precaution and both of these actions would result in an economic loss (Masum Billah, 2014).
10. Also to be noted is that risk transfer mechanism will reduce fear, anxiety, frustration or demoralization which can reduce productivity in the environment.
11. Insurance also encourages creativity, innovation, entrepreneurial activities and trade that are vital for sustainable growth .
Insurance Contribution to World’s GDP
According to Swiss Re, insurance contribution to the world’s GDP was 6.23% in 2016. Insurance contribution to the gross domestic product of developed countries is very significant.
For instance, in Japan, the GDP is 11%, while in areas such as North America, it is about 8%. In United Kingdom and the Netherlands, the figure is about 12%, while for France, it is about 10%.
However, in Nigeria the penetration rate is still very low. Insurance contribution to the GDP is still less than 1%. Efforts are on to increase this figure significantly in the coming years.
Researchers have concluded that based on their findings there is a significant and a positive relationship between insurance and economic growth globally.
A recent study by Din (2017) investigated the relationship between insurance and economic growth for USA, UK, China, Malaysia and Pakistan. The research concluded that there is a positive and significant relationship between aggregate insurance measured by net premiums and economic growth for all six countries. While non life insurance is significantly associated with economic growth for all six countries, life is only promoting economic growth for UK, India and Pakistan.
Benefit to Insurance
It is also interesting to look at another perspective of insurance, relative to investment in infrastructure, various forms of benefits can be mentioned.
Research has equally shown that there is a linkage between insurance, infrastructure and economic growth. For example, investment in infrastructure leads to good quality of life. These automatically lead to improvement in mortality rate and consequently reduce death claims under life insurance. Also, good roads will reduce the number of accidents thereby leading to reduction in claim on motor insurance, goods in transit Insurance and group personal accident insurance e.t.c. This will ultimately lead to a better, stronger and a healthier insurance industry.
In addition, availability of data helps in the generation and preparation of good statistics that are useful in preparing rate guide for insurance. Good infrastructure will ensure this.
Conclusion
Without any doubt, it is very obvious from the above analysis that investment in infrastructure will result in the growth of the economy of any nation.
The attendant insurance needs resulting from such economic growth will be to the benefit of the insurance industry.
The Nigerian Stock Exchange (The NSE) is pleased to announce that it has reviewed its Equities Market Structure, which shall become effective on Monday, July 2, 2018.
The new Market Structure will create a level playing field for all market participants and enable investors deploy broader trading strategies, enjoy best execution and benefit from enhanced market depth.
The changes to the Market Structure include:
Opening and Closing Auctions to be followed by Imbalance Sessions (where bids exceed offers, and vice versa). These Imbalance Sessions allow market participants enter Imbalance Orders to address imbalances from the auction sessions.
Expansion of participants in the auction period to enhance fairness and competitiveness of the price setting mechanism.
Introduction of the size test condition in price determination during the auction period; as it currently applies during the continuous trading session.
Changes to the market price volatility mechanism such that daily Limit up Limit down (LULD) price band is now based on a single reference price (i.e., the previous day’s close) to allow for a symmetric up and down limit of 10% throughout the trading day.
Commenting on the new equities market structure, the Chief Executive Officer of the NSE, Mr. Oscar N. Onyema, said: “The review of the equities Market Structure was carried out to support our hybrid market model which offers the benefits of best execution and tighter spreads to investors. Moreover, it provides potential for cheaper cost of capital to issuers in our market. This Market Structure is in line with our 2018 to 2021 corporate strategy aimed at boosting retail investor participation.”
Mr. Oscar Onyema CEO NSE
Other information relating to the NSE market model can be found in the NSE Equities Trading Manual which will be made available on the NSE website from July 2, 2018.
The NSE remains committed to maintaining a platform that engenders a fair and efficient market in line with global standards.
Determined to open windows of opportunities’ for budding entrepreneurs in Nasarawa State and beyond, SKDC Global Links Limited, an emerging markets and events company has slated the maiden edition of the Nasarawa Entrepreneurs Summit (NES). The event is scheduled to hold at the Taal Conference Hotel, Lafia, the state capital.
According to Mrs. Stella Ajige, the Project Coordinator, the summit would provide the platform for entrepreneurs to attend the crucial entrepreneurship seminar that would hold as part of the summit. Additionally, participants would also have the opportunity of exhibiting their goods and services to an audience of over 2,000. She added that invited headline speakers will include distinguished experts engaged in small and medium business development.
Mrs. Ajige stressed that the NES will further bring the smartest ideas and entrepreneurial spirit of start-ups, innovation hubs, established SMEs together with government, policy makers, industry leaders, consultants and experts. “This unique audience has the influence and intelligence to power faster social and economic development, create collaborative opportunity and stimulate business growth.”
Armed with a mandate to identify barriers and challenges entrepreneurs’ face, the summit will proffer tangible business leeway to enable entrepreneurs seek innovative solutions like learning effective leadership communication skills, how to grow a business, the power of networking, influencing government policy and getting funding access towards expanding opportunities for all small business players.
Beyond participating in the summit, the exhibitions will feature fascinating sights and sounds of Nasarawa – Tourism sites/products/economic assets; cultural and heritage exhibitions. Service sectors such as: telecoms services, soft wares, digital television, videos, music and local movie industry, Nollywood; subscriptions for cable television, payment gateways, tech support retail and wholesale trade, banking, business and accounting solutions providers; insurance, mining, manufacturing, fashion and style would be part of the package and focal point.
With a token N5,000.00 as participation fee per person, entrepreneurs that intend making impact beyond just attending the summit can also exhibit their goods and services with fees ranging from N50,000 to N75,000.
As an exhibitor, Mrs. Ajige noted that the event also offers numerous ways to promote businesses and innovations to the influential audience before, during and after the event. “These include stand-alone promotion via event website, or via our event WhatsApp groups through which you can share, network and interact with other participants. Our event will attract media spanning top tier publications to key trade publications and our event PR team can help you connect with these media to share your stories.”
As an emerging markets and events company expanding opportunities for small businesses to succeed in the highly competitive market places, SKDC Global Links Limited, also assures participants that they would network and cross fertilise ideas through B2B and B2G lunches, specifically designed to bring SMEs, start-ups, entrepreneurs and accelerators together with high-level decision makers from government and industry, to discuss opportunities, build partnerships, share knowledge and make meaningful connections.
By so doing, they will be able to increase their brand awareness, gain new customers, build strong customer relations skills, increase turnover through greater market penetration. They can also benefit by spreading their expertise through impressive company introduction, smart platform presentation, network strengthening, image building, local and national publicity and product introduction.
The seminar and exhibitions will equally provide professional development, networking opportunity, how to best launch new products, writing a business plan, and increasing participants’ financial literacy to help grow their businesses.
The International Telecommunication Union (ITU) – the United Nations specialised agency for information and communication technologies (ICT) – is now accepting entries for the ITU Telecom World Awards 2018, recognising the most outstanding and innovative initiatives around the globe using ICTs for social good.
Entries can be submitted online through 3 August 2018. A distinguished jury of experts will select a shortlist of entrants who will pitch their solutions onsite at ITU Telecom World 2018.
The winners will then be announced by ITU Secretary-General, Houlin Zhao at a high-profile ceremony during ITU Telecom World 2018, taking place 10-13 September in Durban, South Africa.
First launched in 2015, the ITU Telecom World Awards initiative recognizes the innovative application of ICTs for social good created by entrepreneurs; small- and medium-sized enterprises (SMEs), and large industry players alike.
It also facilitates knowledge sharing of best practices, while providing a platform from which to network, mobilise investment, explore partnership potential and create new business opportunities.
The ITU Telecom Awards 2018 welcomes entrants in the following categories:
Global Corporate Awardsfor the most promising innovative solutions with social impact within large companies in two categories: sustainable development and smart emerging technologies.
Global SME Awardfor the most promising solutions from SMEs making innovative use of ICTs for social impact, in a number of different categories.
Host Country SME Award for the best and most innovative SME or solution from the Host Country.
Government Awardfor the National Pavilion at ITU Telecom Word 2018 with the most promising innovative SMEs present at the event, entering the Global SME Award.
All ITU Telecom World 2018 sponsors and exhibitors, either participating within a National Pavilion or Thematic Pavilion, as an Independent Stand, or with an SME Workstation, are eligible to enter the awards.
“Previous ITU Telecom World Awards winners have represented the innovative application of ICTs in the areas of e-health, e-education, digital finance, and smart emerging technologies. Winners earn global recognition, helping them to expand and scale up their businesses, while improving livelihoods through their innovative use of technology,” said ITU Secretary-General, Houlin Zhao. “ITU is proud to have developed this platform for promoting innovative examples of ‘tech for good’ and I look forward to exploring the next wealth of winners this September in Durban.”
ITU Telecom World is a global platform for accelerating ICT innovations, and is organized annually by ITU. It aims to deliver economic development and social good faster through its exhibition for digital solutions, forum for sharing knowledge, and networking hub connecting nations, organisations and individuals.
“The network and connections you can build at ITU Telecom World are invaluable – from a business perspective, an investor perspective, and a networking perspective,” said Matthias Brodner of South Africa’s Simplus Innovation, winner of the 2017 Global SME Award for best business model.
ITU Telecom World 2018 takes place 10-13 September at the Durban International Convention Centre in Durban, South Africa.
Under the theme Innovation for a smarter world, it will combine an international tech exhibition, a forum for sharing knowledge, a networking hub for corporates, governments and SMEs, in addition to the influential ITU Telecom World Awards.
It provides a unique international platform that brings together developed and emerging markets, public and private sector leaders, and industry representatives from across the entire ICT ecosystem.
The negative performance of the local bourse lingered yesterday, marking the fourth consecutive decline as the All Share Index (ASI) shed 0.2% to 38,605.07 points while the YTD return reduced to 0.9%. Accordingly, investors lost N16.2bn as market capitalisation declined to N13.9tn. Profit taking in market bellwethers – SEPLAT (-5.0%), GUARANTY (-0.9%) and NIGERIAN BREWERIES (-1.0%) – was responsible for yesterday’s bearish performance.
Similarly, activity level weakened as volume and value traded fell 31.4% and 37.4% to 267.8m units and N3.8bn respectively.
Yesterday’s top traded stocks by volume were ZENITH(44.8m), FBNH (38.7m) and ACCESS (25.8m) while ZENITH (N1.1bn), GUARANTY(N494.3m) and NESTLE (N414.8m) were the top traded stocks by value.
Mixed Sector Performance
Across sectors, performance was mixed as 2 of 5 indices we track closed in the green. The Insurance and Banking indices trended northwards, up 1.4% and 0.2% respectively as a result of buying interest in NEM (+4.9%), PRESTIGE (+10.0%), WAPIC (+4.3%),ZENITH (+2.0%), UBA (+1.4%) and ETI (+1.0%). On the flipside, the Oil & Gas index was the worst performer, down 2.6% due to losses in SEPLAT (-5.0%). Equally, the Consumer and Industrial Goods indices fell 0.3% and 0.2% respectively on the back of profit taking in NIGERIANBREWERIES (-1.0%), DANGFLOUR (-1.4%), NASCON (-0.2%) and CCNN(-3.1%).
Investor Sentiment Strengthens
Investor sentiment as measured by market breadth (advance/decline ratio) strengthened to 1.2x (23 stocks advanced compared to 20 decliners) from 0.4x in the preceding session. The best performing stocks were PRESTIGE (+10.0%), CILEASING (+9.3%) and ETERNA (+8.9%) while SEPLAT (-5.0%), CUSTODIAN (-4.9%) and LIVESTOCK (-4.6%) were the worst performing stocks. In line with our expectation, profit taking across market bellwethers continued today despite improved investor sentiment.
We expect this bearish trend to be sustained in the next trading session although we do not rule out the possibility of a rebound by week end.
