L-R: Executive Directors, Asset Management Corporation of Nigeria (AMCON), Mr. Kola Ayeye, Dr. Eberechukwu Uneze; Managing Director/Chief Executive Officer, Mr. Ahmed Kuru; Chairman Senate Committee on Banking, Insurance and other Financial Institutions, Senator Rafiu Adebayo Ibrahim and Mr. Aminu Ismail, AMCON Executive Director at the just concluded retreat of the Senate Committee at the NAF Conference Centre…Abuja.

The Chairman, Senate Committee on Banking, Insurance and other Financial Institutions, Senator Rafiu Adebayo Ibrahim, has disclosed plans by the 8^th Senate to do everything it takes to empower the Asset Management Corporation of Nigeria (AMCON) realise the tough mandate given to them by the government and people of Nigeria.

The Senator who spoke yesterday at the opening of the Committee’s retreat at the NAF Conference Centre, Abuja stated that the Upper Chamber, as part of its oversight function, has decided that AMCON requires more support from the legislature if indeed Nigerians expect the Corporation to succeed in line with its sunset clause.

Reading from the keynote address he delivered at the commencement of the retreat titled, “AMCON as a catalyst for Economic Recovery,” Sen. Ibrahim said the upper chamber is intent on having serious discussions as soon as possible, which would AMCON further enhance its recovery mandate.

The Senator, who said there was no better time to redress the issue than now that the country is technically coming out of recession added, “Since inauguration, AMCON has been a key stabilizing and re-vitalizing tool in the Nigerian financial system and requires more support from the legislature to achieve its statutory objectives. This is the main reason why this retreat has been convened with the Senate Committee on Banking, Insurance and other Financial Institutions.

“In this retreat, we hope to make a case for AMCON to take on a larger and more proactive economic responsibility especially given its special place in the economy. To this end, serious conversation needs to occur on how best AMCON can intervene in the current economic situation of Nigeria beyond asset recovery.”

He further disclosed that the fall out of the discussion at the end of the retreat would lead to pronouncements from the 8^th Senate, which would comprehensively empower AMCON to better carry out its functions. Again he affirmed, “…this subject of expanded functions presents an opportunity to further strengthen collaboration and align the objectives of AMCON to the pressing demands of the country.”

He stated that it was safe to say that AMCON has drawn from its proactive and interventional roots in a time of economic crisis for it to take on this new expanded economic role that transcends the banking sector, and seek to revitalize an entire economic system in recession.

He said the 8^th Senate is heavily interested in the activities of AMCON because the leadership of the current Senate from inception conceptualized and mapped out its legislative agenda with economic recovery bill as top priority. According to him, such bills would help the country to raise credit availability and quality risk assets, which is in line with the job AMCON is doing for the nation.

While commending the Management of AMCON led by Mr. Ahmed Kuru, Managing Director/Chief Executive Officer, for the work done so far despite the challenges that confront them, Senator Ibrahim added, that all stakeholders should indeed support the Senate because the nation’s economy would be rebuilt as a result of key resolutions that would be adopted and decisions that would be made to empower AMCON.

Earlier in his address, Kuru reminded the Senate Committee that having fully harvested the low hanging fruits in the first and second stages of AMCON operations, the success or failure of the Corporation at this stage would be heavily dependent on the legislature as well as the judiciary because most obligors of AMCON are employing different antics in law to tie up the Corporation in different courts.

He stated that since AMCON is a creation of the Federal Government through the Act of the National Assembly, the Senate must find a way to encourage the judiciary to apply wisdom on AMCON related cases by focusing on substance rather the current diversionary tendencies that are stalling recoveries and destabilizing the Nigerian economy.

The AMCON CEO said, “There is need for a change of strategy. This job is not an easy assignment by any definition because every obligor has a perception of AMCON and is willing to tie us up in court. That is why you see that every week we have fresh enemies. Therefore we need very strong legislative framework, which would for instance make it possible for all AMCON cases to terminate at the Appeal Court.”

According to him, if the 8^th Senate allows the current legal processes on AMCON-related cases to drag-on as it is presently, he said he does not see AMCON meeting its obligation before its sunset in the next five years.

DANCEM Drags Benchmark Index … NSE ASI down 24bps
The Nigerian Bourse bucked a 2-day consecutive gain as the All Share Index fell 24bps to close at 37,051.54 points whilst YTD return moderated to 37.9%. Similarly, market capitalisation lost N30.3bn to close at N12.8tn.

Today’s negative performance was consequent on profit taking in DANGCEM (-0.9%), ex-DANGCEM market would have closed 4bps northward. However, activity level was mixed as volume fell 9.2% to close at 175.8m units while value traded rose 94.9% to settle at N3.5bn

Mixed Sector Performance
Sector performance today stayed mixed as 3 of 5 indices under our coverage closed in the green, while 2 trended southwards. The Banking index (-0.3%) led losers against the backdrop of losses in ZENITH (-1.9%) and UBA (-1.0%) while a decline in DANGCEM (-0.9%) pulled the Industrial Goods index 0.5% lower.

On the contrary, the Oil & Gas index appreciated the most, up 1.2% on account of gains in MOBIL (+7.8%) and FORTE(+5.0%). The Insurance index trailed, gaining 0.3% due to price appreciation in CONTISURE (+4.4%). Similarly, an uptick in INTBREW (+8.4%) pushed the Consumer Goods index to close 0.1% higher.

Investor sentiment Remains Unchanged
Investor sentiment stayed flat today as market breadth (advancers/decliners ratio) closed at 0.9x relative to 0.9x recorded in the previous session. Leading the gainers’ chart were CAVERTON (+9.5%), INTBREW (+8.4%) and MOBIL (+7.8%) while LAWUNION (-4.6%), NPFMCRFBK (-4.6%) and FIDELITY (-4.1%) were today’s worst performers.

While we attribute today’s performance to profit taking in DANGCEM, the relatively unchanged market breadth suggests investors are still sourcing for bargains. Accordingly, we expect a positive close for the week.

HE Paul Kagame, President of Rwanda and chairman of Smart Africa, and Tony Elumelu, Founder of the $100 million Entrepreneurship Programme, will be headlining the Young Entrepreneurship Day (YED) at the Africa 2017 Forum.
The YED is a new addition to the Forum and will take place on the eve of Africa 2017, on the 7^th December. It has been designed to connect some of Africa’s most promising entrepreneurs and also give them exposure to investors, incubators and accelerators as well as to partake in workshops that will give them the skills and tools to scale up their businesses.
Both Kagame and Elumelu have been championing entrepreneurship and will be sharing their perspectives both from government and the private sector as well as engaging in an open platform with some of the upcoming leaders from across Africa
Sitting on the advisory board of the YED are Issam Chleuh and Rebecca Enonchong, two of the foremost players in impact investing and in the technology space in Africa as well as Parminder Vir, CEO of the Tony Elumelu Foundation.

Other speakers at the YED include Ben White of VC4Africa and Wale Ayeni from IFC Ventures, the venture capital wing of the World Bank’s private sector arm.
Commenting on the YED, the Minister of Investment and International Cooperation Dr. Sahar Nasr, whose ministry is organising the Africa 2017 programme alongside COMESA Regional Investment Agency, said that creating a pro-business environment for entrepreneurs to thrive is at the centre of her government’s policies.

“Egypt has been at the forefront of making entrepreneurship work. With a bustling population of 90 million, 50% of which are below the age of 30 and tech savvy, Egypt is rightly staking a claim as one of the fastest growing entrepreneurial hubs in the world.”
Africa 2017 has been earmarked as the biggest B2B and B2G gathering to take place in Africa this year. A number of heads of state have confirmed their attendance and there are 30 African investment promotion agencies and government delegations scheduled to attend.

Alongside President Al Sisi of Egypt and President Kagame of Rwanda, the Presidents of Côte d’Ivoire, Alassane Outtara will be in attendance as well as the President of Comoros, Azali Assoumani and the Prime Minister of Mozambique Carlos Agostinho do Rosário.

Some of Africa’s biggest names from business will also be attending Africa 2017, with the aim to accelerate cross-border investments and partnerships.
The Forum will also be a platform for Egypt to showcase some of the mega projects that are underway and the opportunities linked to these in agribusiness, logistics, mining, energy construction, real estate and tourism.

Nigerian Equities Market Sustains Momentum… NSE ASI up 34bps
The Nigerian Equities market continued its positive performance today as the All Share Index gained 34bps to close at 37,138.97 points while YTD return expanded to 38.2%.

In turn, investors gained N43.4bn as market capitalization settled at N12.9tn. Today’s performance was buoyed by gains in DANGCEM (+0.9%), INTBREW (+10.2%) and FBNH (+1.7%). However, activity level softened as volume and value traded fell 36.6% and 37.8% to close at 193.5m units and N1.8bn respectively.

Mixed Sector Performance
Performance across sectors was mixed as 2 indices trended northwards, 2 closed in the red and the other flat. The Industrial Goods index emerged the top gainer, up 0.5% due to sustained buying interest in DANGCEM (+0.9%).

Likewise, the Consumer Goods index added 0.4% on account of gains in INTBREW (+10.2%) and NASCON (+3.0%). On the flip side, the Banking index lost 0.2% following profit taking in ZENITH (-0.9%) and ACCESS (-0.9%), while losses in LINKASSURE (-3.9%) dragged the Insurance index 0.1% lower. The Oil & Gas index closed flat.

Investor Sentiment Weakens
Investor sentiment weakened today as market breadth (advancers/decliners ratio) declined to 0.9x from 1.3x recorded in the previous session. Today’s best performing stocks were INTBREW (+10.2%), LEARNAFRICA (+5.0%) and CAVERTON (+5.0%) while the worst performers were UAC-PROP ( -4.7%), LAWUNION (-4.4%) and LINKASSURE (-3.9%).

Despite the weaker investor sentiment recorded today, market performance stayed positive in line with our expectations. We expect a rebound in sentiment in consequent trading sessions as investors continue to seek bargain opportunities in the market.

WHAT IS “DOING BUSINESS”?

Doing Business is a project that provides objective measures of business regulations and their enforcement across 190 economies. It looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle.

By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more efficient regulation; offers measurable benchmarks for reform; and serves as a resource for policymakers, academics, journalists, private sector researchers and others interested in the business climate of each economy.

In addition, Doing Business offers detailed subnational reports, which exhaustively cover business regulation and reform in different cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that the global Doing Business has ranked.

HOW IT ALL STARTED

Doing Business started from two developments in economic growth which happened simultaneously in the late 1980s and early 1990s, said Simeon Djankov, the creator of the Doing Business series and former Deputy Prime Minister and Minister of Finance of Bulgaria.

One was exemplified by Peruvian economist, Hernando de Soto, known for his work on the informal economy and on the importance of business and property rights. In his book The Other Path, published in Spanish in 1989, de Soto makes the point that the prohibitively high cost of establishing a business in his home country of Peru, economic opportunities to the poor were denied. As a result, they end up operating outside the formal economy.

“That was one motivation of the observation,” Djankov added. “If you make it easier for business by simplifying laws and regulations, many more firms and entrepreneurs will switch to the formal sector.”

In the formal sector, he said, workers will have benefits like social security, pension and insurance coverage. At the same time, the government benefits because it will get taxes through which health and education budgets can be replenished.

Second, with the collapse of communism after the Berlin Wall fell in 1989, new questions ascended. Many countries in Eastern and Central Europe and the former Soviet Union were running the economy as a state-owned economy. As a result, they did not think about how do you actually establish laws and regulations for small domestic private business to develop.

“These two things came together,” Djankov said. “We then asked the question in the one case, how can you simplify regulation, and in the other case how can you create new regulations so that businesses can be formal and that new businesses can be established in the formal economy and they can be a large generator of jobs.”

At that point when Doing Business was being considered in the late 1990s in the World Bank, there was a big discussion about whether the private sector can generate jobs at all, or the private sector is actually for small tiny firms and it’s just the state sector generating jobs.

“At that time 20 years ago, having to make that point that yes, if the private sector has simplified regulations it can actually be a generator of jobs and innovation. So, we helped establish that literature.” He added.

The Doing Business report was then established with five sets of indicators for 133 economies.

TOP IMPROVERS IN 2017

Governments in 119 economies carried out 264 business reforms in the past year to create jobs, attract investment and become more competitive, says the World Bank Group’s latest Doing Business 2018: Reforming to Create Jobs report.

This year marks the 15th Doing Business report. Since the inception of the project in 2003, the global business regulatory environment has changed dramatically. Governments around the world have embraced and nurtured advances in information technology to reduce bureaucratic hurdles and increase transparency.

Today, in 65 of the 190 economies covered by Doing Business, entrepreneurs can complete at least one business incorporation procedure online, compared with only nine of the 145 economies measured in Doing Business 2004. Furthermore, in 32 economies it is now possible to initiate a commercial dispute online. This kind of progress can also be observed in the other areas measured by Doing Business.

Marking its 15th anniversary, the report notes that 3,188 business reforms have been carried out since it began monitoring the ease of doing business for domestic small and medium enterprises around the world.

“Job creation is one of the transformational gains that countries and communities can achieve when the private sector is allowed to flourish. Fair, efficient and transparent rules, which Doing Business promotes, improve governance and tackle corruption,” said World Bank Chief Executive Officer Kristalina Georgieva.

Developing countries carried out 206 reforms, accounting for 78 percent of the total reforms, with Sub-Saharan Africa implementing 83 reforms, a record for a second consecutive year for the region, and South Asia implementing a record 20 reforms. A large number of reforms centered on improving access to credit and registering a new business, with 38 reforms each, as well as facilitating cross border trade, with 33 reforms.

In its annual ease of doing business rankings, New Zealand, Singapore and Denmark retained their first, second and third spots, respectively, followed by Republic of Korea; Hong Kong SAR, China; United States; United Kingdom; Norway; Georgia; and Sweden.

This year’s top 10 improvers, based on reforms undertaken, are Brunei Darussalam (for a second consecutive year); Thailand; Malawi; Kosovo; India; Uzbekistan; Zambia; Nigeria; Djibouti; and El Salvador. For the first time, the group of top 10 improvers includes economies of all income levels and sizes, with half being top improvers for the first time – El Salvador, India, Malawi, Nigeria, and Thailand.

“As we celebrate the 15th anniversary of Doing Business, it is particularly gratifying to see that many of the reforms are being carried out in economies and sectors where they are most needed. We look forward to continuing to shine a light on the real hurdles faced by entrepreneurs, both women and men, and celebrating policy change successes,” said Rita Ramalho, Acting Director of the World Bank’s Global Indicators Group, which produces the report.

WHERE IS BUSINESS REGULATION BETTER?

Although the economies with the most business friendly regulation in this year’s ease of doing business ranking are relatively diverse, the economies within the top 20 share some common features. Thirteen of the top 20 are OECD high-income economies; four are from Europe and Central Asia and three from East Asia and the Pacific. Eighteen of the top 20 are classified as high-income economies.

BUSINESS REGULATION IMPACT ON EMPLOYMENT AND POVERTY

Many factors explain poverty. These can include vulnerability to natural disasters, remoteness and quality of governance etc. Reforming in the areas measured by Doing Business can be particularly beneficial to employment creation when those reforms take place in the areas of starting a business and labor market regulation.

Across economies there is a significant positive association between employment growth and the distance to frontier score. While this result shows an association, and cannot be interpreted in a causal fashion, it is reassuring to see that economies with better business regulation, as measured by Doing Business, also tend to be the economies that are creating more job opportunities.

When it comes to unemployment, the expected opposite result is evident. Economies with less streamlined business regulation are those with higher levels of unemployment on average.

LIKE THE “WORLD CUP”

Throughout the 15 years of Doing Business, Djankov said that the biggest impact is that countries would compete on it. “That’s a component that in a way that most of our analytical and theoretical work we hadn’t thought of.”

He added that in addition to good policy, once you start ranking countries and comparing them, natural competition like a “World Cup” or the “Olympics” comes about.