NAICOM to Engage Insurers on 10-Year CEO Tenure Code

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08/11/2016

The National Insurance Commission (NAICOM) says it will engage operators in the insurance industry before taking a definite position on the 10-year tenure for Chief Executives (CE0s) of corporate organisations proposed by the Financial Reporting Council (FRC) under its Code of Corporate Governance model.

Alhaji Mohammed Kari, Commissioner for Insurance, Naicom, said the commission needs time to look through the provisions of the Code released by the FRC as it affects the insurance sector.
If Naicom adopts the provision of the Code on the 10-year tenure model for CE0s, not less than 13 CE0s of insurance firms will vacate their seats.

Already, there is concern in the market that forcing out such large number of CE0s at a time the Commission is moving towards Risk-based Supervision and sending out subtle signals for more capitalisation in the insurance industry will ultimately impact negatively on the sector.

There is also considerable evidence that a committee of insurers are set to meet with the leadership of the FRC to rationalise the key issues in the Code, as well as the contentious tenure matter.

ATCON: ‘0.2% Communications Tax Better than 9%’

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08/11/2016

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The Association of Telecommunications Companies of Nigeria (ATCON) has proposed communications tax of 0.2% as an alternative to the current Communication Service Tax (CST) bill of 9% before the National Assembly.

Mr. Olusola Teniola, President, ATCON, who made the call during a courtesy call on the Senate President, Saraki in Abuja, also recommended a tax reform that increases the current VAT by a new 1% added for the purpose of development of communications.

‘In 2013, we planned to achieve 30% Broadband penetration by 2018. Current access figure is clearly some way off this target and needs measures to boost growth in usage. A sharp rise in tax as being proposed in the CST will achieve the exact opposite of our desire. Another alternative is that the tax being proposed in the Bill be limited to 0.2%.’

The full speech by Teniola is reproduced below under ‘For The Record column.’

‘FG Should Fast-track Reform to Reap Opportunities in Oil & Gas Sector’

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08/11/2016

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Ibe Kachikwu, Minister of State for Petroleum

Afrinvest Research gives its view on the 7 Big Wins in the Oil & Gas Sector launched by the federal government. Below is the analysis:

Given the prominent role the petroleum sector plays in Nigeria, especially in relation to export earnings, government revenue and gross external reserves, we believe that the successful implementation of this proposal should fast-track required impetus to optimise opportunities in the oil & gas sector amid recent efforts to boost the non-oil contribution to export earnings and government revenue.

7 Big Wins … A look at Nigeria’s Oil & Gas Sector Short to Medium Term Priorities
The Ministry of Petroleum Resources released a report tagged “7 Big Wins- Short and Medium Term Priorities to grow Nigeria’s Oil & Gas Industry 2015- 2019” which focuses on improving transparency, efficiency, investment and security in the oil & gas sector.

The report also reviews developments in the sector between November 2015 and August 2016 while outlining the short-medium term plans of the Ministry of Petroleum Resources to reposition the industry, ramp up production, reduce costs, foster efficiency and attract investments across the oil & gas value chain. The document highlighted the 7 key focus areas to grow the Nigerian Oil & Gas industry as follows:

Policy and Regulation

Gains from the recently (May 2016) introduced price modulation framework that ensured a market reflective pricing of petroleum product was highlighted as a key success factor in curbing issues surrounding the diversion of petroleum products to neighbouring countries. This was noted to have reduced daily PMS truck loadout by 47.0% from an average of 1,031 to 546 trucks, eliminated subsidy payment and resulted in an increase in PMS supply within the country, saving the government about N15.4bn monthly.

However, the document emphasised the passage of the Petroleum Industry Reform Bill (PIB) as a key factor to drive reform further. We note that during the week, the National Assembly continued discussion on the PIB with increased optimism that the Bill will be passed soon. A key feature of the PIB is the establishment of a single Independent Regulator which will increase transparency in the sector. In addition to the PIB, the report also outlined plans to introduce 4 new policies; National Oil policy, National Gas policy, Downstream policy and Fiscal Reform Policy. Other policy and regulatory aspirations included, a gas sector policy blueprint, conclusion of the liberalization of the downstream sector, establishment of an appropriate pricing framework for all products, initiation of petroleum products tracking system and elimination of toxic contracts in NNPC.

Business and Investment Drive

Emphasis here was on improving business and operating environment in the sector (Upstream, Midstream and Downstream) to attract investment. In essence, a renewed approach to solving the Niger Delta crisis became the focus while fiscal and regulatory reforms to allow full private sector participation and reduce government dominance in the downstream sector and monopoly in the midstream sector.

Close to a US$100.0bn investment is expected to be attracted to the sector should the above be implemented successfully. In line with the above, strategic investment roadshows are expected to be conducted in China, India and US. It must be noted that in June 2016, an investor’s roadshow held in China resulted in signed MOUs worth over US$80.0bn. Also, discussion of a crude oil swap worth US$15.0bn between Nigeria and India is underway.

Gas Revolution

Plans to harness the vast gas reserves available in the country to reposition Nigeria to become a gas-based economy from an oil-based economy. The immediate gains from this will boost power supply and increase government revenue. A robust gas blueprint which focuses on investment in Gas Infrastructure (such as petrochemical plants), Gas Revolution projects (to improve domestic utilisation and gas monetisation), Promotion of Domestic Utilisation of Liquefied Petroleum Gas (LPG) and Compressed Natural Gas (CNG), reduction of gas flaring and a commercial gas framework is expected to be implemented to jump-start the gas industry.

Refineries and Local Production Capacity

In the last one year, some local refineries have been partially revived and as such daily production stands at about 7 million litres or 44 thousand barrels. Restoring local refineries to maximum production capacity is one of the major focus points in a bid to ensure a paradigm shift to reposition Nigeria from a net importer of refined petrol products to a net exporter by 2019 while also diversifying the export base. To achieve this, emphasis was placed on the rehabilitation and optimization of capacity utilization of existing local refineries while setting up co-located refineries and modular refineries to guarantee effective supply and distribution of products across the country and African sub-region. Private sector investments as well as Joint Venture Agreements are also expected to boost activities in the sector with an injection of US$1.4 – US$1.8bn for resuscitation of existing refineries.

Niger Delta Security

In response to attacks on oil installations in the Niger-Delta due to the resurgence of militancy in the region, and to support Government’s efforts in tackling these challenges, the document proposes a number of initiatives which include: development of a master plan for the region, introduction of new standards for oil & gas infrastructure to minimise threats of vandalism and the implementation of clean-up of oil polluted areas e.g. Ogoni land amongst others. Nonetheless, the plan to strengthen security in the short-medium term remains largely hinged on improvement in environmental conditions, diplomacy on the part of the current administration and collaborative effort of oil producing companies and the locals.

Transparency and Efficiency

Without doubt, improvement in transparency and efficiency will drive interest in the sector and a key component to this is the finalisation of the 2011 – 2015 audit of the NNPC which will improve fiscal responsibility as well as give investors better insight into the sector. In addition, the plans for the restructuring of the NNPC will also be finalised while Research & Development centres are set up with the deployment of ICT to ensure efficiency and accountability across the NNPC and Parastatals.

Stakeholder Management & International Co-ordination

This focuses mainly on improving communication in the sector both internally and externally with other petroleum producing countries while also increasing Nigeria’s relevance in the league of oil producing nations through active membership and participation.

SMILE Partner Alcatel on 4G LTE Voice Device Bundle

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08/11/2016

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Smile Communications has entered into a partnership with Alcatel to launch affordable voice over 4GLTE (VoLTE) device bundle utilizing the ALCATEL POP 4 series to further expand its voice reach. This is in line with the vision to provide innovative telecommunication solutions and offer unique propositions to new customers.

“This latest partnership reflects our desire to collaborate with companies that share our vision to provide world class service to our customers. We are very excited to work with Alcatel to offer the best value proposition and experience to customers in Nigeria.” said Ololade Shonubi, Head of Marketing at Smile Communications.

The unique bundle offer includes voice over 4GLTE Alcatel POP 4 handset, a complimentary 4G LTE sim and 60 days access to the internet for browsing and e-mails, 60 day access to social network sites, 30 SMS and 30 minutes local calls to any network on activation of the Smile voice app.

Shonubi disclosed that some of the benefits of using a Smile 4G LTE sim in a Voice over 4G LTE handset includes the ability to make calls locally and to anywhere in the world, Internet browsing, video/music streaming/downloads and SMSs, all using one Smile bundle plan, which is a first in the Nigerian market.

Commenting on the partnership, Nick Imudia, Regional Director, Nigeria and Central Africa at Alcatel said: “Our partnership with Smile Communications is one that will give Nigerians the opportunity to experience a superfast and innovative network using a quality smartphone that packs more cool features than any other device in its category. Now with the right device on the right network, Smile customers can achieve more.”

The Alcatel Pop 4 smartphone comes with a 5-inch touchscreen display that boasts a resolution of 720 pixels by 1280 pixels at a PPI of 293 pixels per inch. It runs Android 6.0 Marshmallow and is powered by a 2500mAh non removable battery.

This device boasts a 1.1GHz quad-core Qualcomm Snapdragon 210 processor and a 1GB RAM as part of its hardware component while its 8GB of internal storage can be expanded up to 32GB via a microSD card. It has an 8-megapixel primary camera on the rear and a 5-megapixel front shooter that shoots great pictures. Both cameras come with individual LED flash.

Smile has a range of innovative Voice and Data offers, and has recently reinforced the 0702 number range with the lowest call tariff that allows its customers to make calls at 8kobo per second to any network from within and outside the country at the same rate, using SmileVoice App on any Smart Phone and 4G LTE SIM on Voice over LTE or LTE compatible handsets.

63% of Africans Believe China Has Good Influence in Africa

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08/11/2016

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In Africa, a good part of the population believes China’s influence on the continent is positive, consortium of survey institutes Afrobaromètre said in a study released on October 28, 2016.

According to the study, 63% of the population surveyed – 50,000 people from 36 African countries – thinks China’s political and economic influence on the continent is positive. Only 15% of those questioned believe the opposite.

Countries that share the first belief most include Mali, Niger and Liberia with respectively 92%, 84% and 81% of the surveyed on that side.

In opposition, in Egypt, Ghana, Lesotho, Madagascar, Morocco and Zimbabwe, less than 50% of population surveyed has a positive opinion of China’s influence.

China is behind the USA in the rankings of nations with the best national development models. Yet, it is significantly ahead of former colonial powers. 24% of the surveyed in fact affirm that China has the best development model while 30% prefer US’ model.

The development model of former colonial powers comes third in the rankings picked by 13% of the surveyed ahead of South Africa’s (11%).

The majority of the population surveyed (56%) said development aid from China meets the needs of their countries.

The main factors explaining why China is so well seen by Africans are its investments in infrastructure projects (32% of the surveyed believe) across the continent and the low cost of its products (23%).

As for factors contributing to China’s influence on Africa being perceived negatively there is the poor quality of its products (35%), the fact that Chinese companies hire few locals (14%), the country’s huge appetite for Africa’s resources (10%) and Chinese investors grabbing lands from Africans (7%).

–Walid Khefifi

GEM-TECH Award Winners to be Unveiled on Nov 15 in Bangkok

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08/11/2016

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ITU and UN Women will jointly announce the three winners of the 2016 GEM-TECH Awards at ITU Telecom World in Bangkok, Thailand, on 15 November, bringing global attention to the finest work being done to empower women in the digital world and deliver on the Sustainable Development Goal to improve gender equality (SDG5).

The GEM-TECH Awards recognise outstanding contributions by organisations, individuals and innovative policy-makers to advance gender equality in the technology sector with a specific focus on information and communication technologies (ICTs).

The third annual Gender Equality and Mainstreaming in Technology Awards will highlight ITU’s continued commitment to promoting innovation and partnerships that work to shrink the overall global internet user gender gap, which has grown since 2013 with currently more than 250 million fewer women online globally than men.

The 2016 GEM-TECH Award winners were selected by a panel of experts in gender mainstreaming and ICTs at ITU and UN Women. They will represent each of the following categories:

Apply Technology for Women’s Empowerment and Digital Inclusion
Promote Women in the Technology Sector
Develop Gender Responsive ICT Governance, Policy and Access

The ceremony will feature opening remarks from high level representatives of ITU and UN Women and a keynote address from Kathryn C. Brown, President and Chief Executive Officer of the Internet Society.

ITU and UN Women are proud to also announce that the GEM-TECH Awards worked closely with these partners from public and private sectors around the world: the Internet Society, Verizon, MasterCard, Facebook, Swiss Confederation Federal Office of Communications (OFCOM), Rwanda Utilities Regulatory Authority (RURA), and VimpelCom.

FOR THE RECORD: SPEECH OF MR OLUSOLA TENIOLA, PRESIDENT, ASSOCIATION OF TELECOMMUNICATION COMPANIES OF NIGERIA (ATCON) AT A COURTESY VISIT TO THE SENATE PRESIDENT ON THURSDAY, NOVEMBER 3RD, 2016

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08/11/2016

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Protocols,

Senate President Sir,

Other distinguished Senators present

Ladies and Gentlemen

We appreciate the Senate President’s speedy response to our request to meet with him.

We congratulate you Sir on all the courageous interventions that the distinguished Senate of the Federal Republic of Nigeria has made to our laws in recent times.

Our mandate is to support the Federal Government to succeed in attracting and protecting investments in the telecommunications industry and to make meaningful input to all aspects of economic development including legislation and management of our industry so it continues to be the oil of growth and development.

The on-going work on the proposed 9% Communication Service Tax Bill (CST) is a trending subject. We would be happy to support Government to make the best of our tax efforts which certainly are key components of strengthening the economy and sustaining our industry. Contrary to uninformed opinions we do not object to reforms in taxation neither do we regard taxes as burden.

No doubt, there is severe pressure at these times and Government revenue cannot be different. We however pray that the template with which the telecom industry is viewed and assessed be slightly modified. The truth, Sir is that there is severe over taxation in our industry. It explains the slow penetration of services into unserved areas of the country. The truth again sir is that contrary to popular belief telecommunication operators and service providers are barely sustaining existence in these times.

There are reasons to suggest that the desire to widen the tax net is laudable and that as things stand telecommunications is about one of the few areas where the net-capture may be widened, we therefore suggest that an increase in VAT tax which is already included in all services of telecommunications by an increase that is not beyond 1% should be a good reform strategy.

Input of recent studies by credible organisations is our guide.

The projections are that a new tax on ICT services as high as 9% that is being proposed would result in excluding 10% of the population, that is talking of about 20 million Nigerians from access. Whereas the survival of our economy is on attracting more citizens into access to internet and therefore ICT services. It does not add up if whatever we do ends up not bringing more people into access.

The reality of Internet access in Nigeria is that it’s all about mobile. Only about 13% of Nigerians get broadband access via mobile while less than 1% does from fixed services.

One of the main reasons the rate of Internet adoption and use is rather slow in Nigeria is the high cost of data subscription.

A 500MB plan costs typically 5.4% of average monthly income. The current definition of affordability used by the UN Broadband Commission is where the price of a broadband plan is less than 5% of average monthly income. If we are to use this definition Nigeria is on the cusp of affordability.

In Nigeria the average income in 2014 was USD$2970 (GNI per capita, source: World Bank), 40% of the population actually earned less than half that amount. In practice this means that a 500MB mobile Internet plan priced at 5.4% of average monthly income actually costs the majority of Nigerians anywhere between 7-18% of monthly income.

In 2013, we planned to achieve 30% broadband penetration by 2018. Current access figure is clearly some way off this target and needs measures to boost growth in usage. A sharp rise in tax as being proposed in the CST will achieve the exact opposite of our desire.

In conclusion, we ask for a reconsideration of the CST Bill.

We recommend, as an alternative, a tax reform that increases the current VAT by a new 1% added for the purpose of development of communications.

Another alternative is that the tax being proposed in the Bill be limited to 0.2%.

Thank you Sir and thank you all for this opportunity and please accept our esteemed regards.

Olusola Teniola

National President, ATCON

Pension Industry Needs ICT to Reach 20m Contributors by 2019

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07/11/2016

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Chinelo Anohu-Amazu, Director-General, PenCom

The pension industry needs rapid deployment of information and communications technology to achieve its target of 20 million contributors by 2019.

This was part of the 9-Point communiqué at the end of the Annual Retreat for Media Practitioners organised by the National Pension Commission (PenCom) in Calabar, Cross River State.

Other recommendations in the communiqué include:

To adequately capture the informal sector, there is need for the pension industry to carry out lots of enlightenment campaigns on the scheme through trade associations and unions, while media has a greater role to play in pension propagation.
Pension operators must be aggressive in the marketing of pension products and services, so as to grow the pension contributors to 20 million by 2019. Here, there is a call for attractive incentives for subscribers so that more people can key into this scheme.
The need to drive the pension scheme through information technology is regarded as germane to its success.
Moreover, there is the need for consistency in government policies for co-ordination and investment of pension assets in infrastructure.
There is need for bankable projects to enable pension operators invest in infrastructure
Reliable investment templates should be developed for injection of pension funds in real sector.
For pension funds to be invested in the energy sector there is need for correct and adequate database of power users.
Insurance and pension operators as well as regulators are expected to address the issue of demarketing of Programmed Withdrawals and Annuity.

The media are required to verify any information they have on pension matters before reporting it in their various media, as bad information can lead to negative perception about pension. Balanced and fair reporting, according to the participants, is what is needed to enhance the sensitisation and understanding of the scheme.

The participants applauded PenCom for organising the seminar as part of its sensitisation exercise to deepen pension penetration and reportage in the country.

The participants believe that with increased pension education and sensitisation on the CPS and micro-pension, the target of 20 million pension contributors by 2019 is achievable.

Furthermore, the media practitioners agreed that there is still low awareness on pension matters, hence calling for improved awareness by relevant stakeholders on the CPS, in order to grow the pension assets and contributors.

The training provided more clarity and deepened the knowledge of journalists about the Contributory Pension Scheme who promised to apply the knowledge acquired to enlighten the Nigerian public about pension issues.

The regulator was equally mandated to extend enforcement of pension scheme to media houses so that they can remit monthly contributions as and when due.

In the same vein, PenCom was advised to set aside 1-5 per cent of its annual budget for media workshop, seminars and other forms of trainings.

PenCom was also asked to carry the media along in its foreign travels and seminars in order to broaden their knowledge and create news for the media.

Adeosun: PPP Model to Drive Infrastructure Plan

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07/11/2016

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The Minister of Finance, Mrs. Kemi Adeosun said at the African Development Bank Knowledge Sharing Forum in Abuja that the Federal Government is committed to improve the operation of Public, Private Partnership arrangement in the country.

According to the Minister, the Federal Government believes that Public Private Partnership is extremely important to the drive to restore and resolve the infrastructure of this country, saying that solving the nation’s infrastructure problem would unlock the potential of the economy and get Nigeria out of the current challenges.

“As far as our financial strategy is concerned, we are very committed to PPP and for us, the way to accelerate it is for the Federal Government to de-risk the involvement of the private sector and gradually, introduce the private sector to the PPP. This is because if we wait for every law to be changed and regulations to be amended, we will really not get any single project done,” the Minister stated.

She disclosed that the Federal Government plans to start with a number of transactions in 2017 and that it will use the federal guarantee to simply take the risk away from the risky avarices of the projects of, for example, road projects which are risky.

“So we will de-risk; we will guarantee and will allow private money to crowd in to these transactions. It is something we must crack because clearly, our infrastructure deficit is so large that even if we spend our entire budget on infrastructure for the next five years, we cannot bridge the gap, so we must be able to get private money,” she stated.

Access Bank Grows Q3 Profit to N72bn

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07/11/2016

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Herbert Wigwe, Group MD/CEO, Access Bank Plc

Access Bank Plc has announced an impressive profit of N72 billion for the nine months ended 30 September 2016 based on enhanced business efficiency as a result of the effective execution of its long-term strategy.

The Bank’s Profit Before Tax (PBT) showed an increase of 19% from N60.4 billion recorded during the same period in 2015. Profit After Tax (PAT) grew by similar margin from N48.1 billion in 2015 to N57.1 billion in 2016.

Access Bank Group’s unaudited nine-month results released to the Nigerian Stock Exchange (NSE) on Friday also showed Gross Earnings of N274.5 billion, up 7% from N257.6 billion in the corresponding period of 2015. The growth in gross earnings was driven by 17% increase in interest income on the back of continued growth in the Bank’s core business.

Similarly, the Bank posted 12% growth in operating income to N199.3 billion from N178.1 billion in 2015. Customer Deposits grew 25% to ₦2.10trillion from ₦1.68 trillion in December 2015.

Access Bank’s Capital Adequacy Ratio (CAR) remained solid at 19% as at September 2016, well above the regulatory minimum.

Commenting on the result, Group Managing Director/CEO, Herbert Wigwe said: “Access Bank’s performance in the first three quarters of this year remained strong and consistent, reflecting a stable business with the capacity to deliver sustainable returns, particularly during a period underlined by significant macro headwinds.” According to him, the Group maintained stable asset quality, recording NPL and Cost of Risk Ratios (CRR) of 2.1% and 0.9%, respectively.

“Our capital and liquidity position remained adequately above regulatory levels, as we continued to implement a disciplined capital plan, ensuring sufficient levels of profit retention to support our growth. In addition to capital enhancement, the recently concluded $300 million senior unsecured debt issue allows us optimise and enhance our foreign currency funding capacity whilst strengthening our balance sheet,” Wigwe added.

The Bank’s asset quality ratios also improved as the percentage of Non-Performing Loans (NPL) to total gross loans stood at 2.1% compared to 1.7% in December 2015. The NPL Coverage Ratio remained strong at 209.5% in the period, compared with 216.4% as at December 2015.

Further analysis of the result indicated that Cost to Income Ratio (CIR) improved 190bps y/y to 57.7 % in the nine months of 2016 on the back of strong income growth during the period. Total Assets stood at N3.39 trillion, up 31% compared to N2.59 trillion in December 2015.

“We remain committed to our cost containment plan, as we strive to balance operational efficiency with earnings growth in a constrained environment. The Bank will remain resilient in the achievement of its strategic imperatives; maximizing our strong market position and solid capital base, while leveraging digital innovation to improve service touch points as we sharpen our retail play with emphasis on cheaper funding sources,” Wigwe noted.

About Access Bank Plc

Access Bank is now one of the top 3 banks in Nigeria and ranked among the top 500 global banks according to a 2015 report by The Banker magazine.

The Bank recently won Best Branch Automation Project in the 2016 Asian Banker Awards; 2016 Karlsruhe Outstanding Business Sustainability Award; 2016 Euromoney Africa’s Best Bank Transformation Award; EMEA Finance Best Bank of the Year and CEO of the Year and the BusinessDay Best Bank of the Year and CEO of the Year.

The Bank currently serves over 7 million individual and corporate account holders, through 370 branches and with more than 1,500 ATMs in major centres across Nigeria, Sub-Saharan Africa, the Middle East, the UK and Representative offices in Asia.

African Airlines Record 8% Passenger Rise in September

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07/11/2016

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The International Air Transport Association (IATA) announced global passenger traffic results for September showing that demand (measured in revenue passenger kilometers, or RPKs) grew 7% compared to the same month in 2015.

This was the strongest year-over-year increase in seven months. Capacity climbed 6.6% and load factor edged up 0.3 percentage points to 81.1%. Growth in domestic traffic slightly outpaced growth in international traffic.

“September’s growth in passenger demand was healthy. Importantly, this rebound from August weakness suggests that travel demand is showing its resilience in the aftermath of terror attacks. We must, of course, be ever-alert to the ongoing terror threat. And overall the industry is still vulnerable to being buffeted by rising geopolitical tensions, protectionist political agendas, and weak economic fundamentals. This will still be a good year for the airline industry’s performance, but our profitability will continue to be hard-won,” said Alexandre de Juniac, IATA’s Director General and CEO.

September 2016 (% year-on-year)	World share¹	RPK	ASK	PLF (%-pt)²	PLF (level)³
Total Market	100.0%	7.0%	6.6%	0.3%	81.1%
Africa	2.2%	7.5%	7.3%	0.1%	72.7%
Asia Pacific	31.5%	10.2%	8.3%	1.4%	79.6%
Europe	26.7%	5.0%	5.1%	-0.1%	84.3%
Latin America	5.4%	4.3%	1.0%	2.6%	82.2%
Middle East	9.4%	11.0%	13.7%	-1.8%	73.9%
North America	24.7%	4.2%	4.1%	0.1%	83.5%

International Passenger Markets
International RPKs climbed 6.9% with airlines in all regions recording growth compared to 2015. Total capacity climbed 7.2%, causing load factor to slide 0.2 percentage points to 80.4%.

European carriers saw September demand rise 5.2% over September 2015. Capacity rose 5.7% and load factor slipped 0.4 percentage points to 84.8%, which was the highest among regions. Demand growth seems to be returning to normal after the disruption caused by terrorism and political instability.
Asia-Pacific airlines’ traffic rose 8.6% in September compared to the year-ago period, although there are still signs of Asian travelers being put off by terrorism in Europe. Capacity increased 7.7%, and load factor rose 0.7 percentage points to 77.9%.
Middle East carriers had an 11.5% rise in demand in September compared to a year ago, which was the largest increase among regions. Capacity rose faster, however, up 13.8%, and load factor dropped 1.5 percentage points to 73.9%.
North American airlines experienced a 3.3% rise in demand. While the upward trend in international traffic has eased of late, seasonally-adjusted passenger volumes have risen at an annualized rate of 6% since March. Capacity rose 4.2% and load factor fell 0.7 percentage points to 81.5%.
Latin American airlines’ September traffic rose 7.1% compared to the same month last year, aided by strong demand on international routes within the region. Capacity climbed just 2.4% and load factor surged 3.6 percentage points to 83.7%, second highest among regions.
African airlines posted an 8% rise in traffic which was matched by an equivalent rise in capacity. Load factor was almost flat at 72.0%. The strong demand increase largely reflected favorable year-ago comparisons, as economic conditions in much of the continent remain challenging.

The Bottom Line

October saw the global aviation industry take a major step ahead to ensure that its growth is sustainable. “The nations of the world came together through the International Civil Aviation Organisation (ICAO) to agree a plan to offset the environmental impact generated by future air traffic growth.

In taking this unprecedented step toward achieving long-term sustainability for an entire industrial sector, governments recognised the immense contribution aviation makes to economic development and global well-being.

In conjunction with our investments in more efficient technologies, infrastructure and operations, this will ensure that aviation can continue to be the business of freedom, connecting our world with safe, efficient, reliable and sustainable air transport,” said de Juniac.

CBN Orders MTN to Stop Dividend to Bank Shareholders

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26/10/2016

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The Central Bank of Nigeria (CBN) has issued an order suspending all dividend payment by MTN to its shareholders for Q3 2016 from its Nigerian subsidiary. The order concerns four commercial partner banks of MTN Nigeria: Standard Chartered Bank, Stanbic IBTC, Diamond Bank and Citi Bank.

The decision comes amid an investigation on MTN Nigeria undertaken by the senate which said the firm has illegally repatriated about US$14 million to South Africa where it is based.

However, in the statement on the firm’s activities at September 30, 2016, published on October 24, 2016, Phuthuma Nhkelo, Chief Executive of the MTN Group, denied the Senate’s accusation. He affirmed that MTN’s subsidiary was cooperating with the senate in the framework of its investigation.

MTN added that its Nigerian branch declared no dividends since April 2015 and said it would not pay any over the next six months. A decision that angered MTN Nigeria’s shareholders who consider the dividends as returns on investment. They believe the dividends as a debt the firm owes them and which it must pay, said Sola Abodurin, the President of the Ibadan branch of the Shareholders Association of MTN Nigeria.

The President of the Association of Telecom Companies of Nigeria (ATCON), Olushola Teniola, added that the CBN cannot forbid a legitimate company from declaring or paying dividends, unless it has clear evidence of criminal activity or a court mandate approving the move.

For the third quarter of 2016, MTN generated R9 billion (US$648,900), up 12% compared to Q2 2016 where its earnings stood at R8,075,000 (US$582,207).

In parallel, its number of customers soared 0.9% from 232,577,000 at June 30, 2016, to 234,696,000. Even its global ARPU (Average revenue per user) which was US$19.33 for Q2 2016 rose to $19.68 dollars last quarter.

– Muriel Edjo

Adeosun: FG Committed to Infrastructure Development

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26/10/2016

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The Minister of Finance, Mrs. Kemi Adeosun has told the visiting Director, African Department of the International Monetary Fund (IMF), Mr. Abebe Aemro Selassie that the Federal Government is leaving no stone unturned in its bid to make infrastructure development a priority.

Taking the visiting IMF chief through some of the initiatives of the current administration, the Minister said the President Muhammadu Buhari administration is doing everything to make Nigeria productive in every aspect.

This, she said, would be achieved by shifting emphasis to the development of infrastructure, which had been neglected by previous administrations.

According to her, with a population of about 180 million people, Nigeria has no choice but to be productive, saying this can only be achieved through infrastructure.

She recalled that “the allocation for capital projects in 2015 budget was just 10 per cent while the recurrent was 90 per cent which had been the case in the past six to seven years.”

She assured that the Federal Government is working with the private sector, and justified Nigeria’s deficit budget, saying there is no problem with running a deficit budget as long as it is done with emphasis on capital project financing.

5G, Internet of Things Key Focus of ITU Standards Conference

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26/10/2016

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The World Telecommunication Standardization Assembly (WTSA-16) got underway today in Hammamet, Tunisia which offers ITU members the opportunity to set the strategic direction of the ITU Telecommunication Standardisation Sector (ITU-T) for the next four years.

WTSA-16 will review ITU-T’s structure, working methods and mechanisms for collaboration with other standards bodies, SMEs and open-source communities, and the many vertical sectors applying ICTs as enabling technologies. This work will result in the provision of a standardization toolkit optimized to assist government and industry in realizing the full potential of the post-2020 ICT environment.

Youssef Chahed, Head of Government of the Republic of Tunisia, delivered the welcoming remarks at the WTSA-16 Opening Ceremony where he highlighted the importance of information and communication technologies (ICTs) to the creation of a knowledge society by 2020.

“The new standardisation strategies to be decided at this Assembly will provide the foundation for ICT development and the creation of a knowledge society,” said Chahed. “Standards are important to success in innovation and creativity, for example in 5G communication and Smart Cities.”

ITU Secretary-General Houlin Zhao said: “The WTSA process continues to be the world’s foremost platform for multi-stakeholder collaboration in the interests of leveraging ICTs to drive sustainable development. ITU’s unique public-private partnership of members from government, industry and academia is essential to its value proposition. Our Member States ensure that ITU is globally represented, and this gives great strength to our standardization work. We work with our members to strengthen ITU and the task of this Assembly is to ensure that standardization remains well-positioned to support the development of the global ICT ecosystem.”

The decisions of the WTSA-16 will shape ITU-T into a form optimized to assist government, industry and academia in achieving their ambitions for year 2020 and beyond, in fields including IMT-2020 (5G), the Internet of Things, Smart Cities, and the ICT sector’s contribution to the pursuit of the United Nations’ Sustainable Development Goals.

Director of ITU’s Telecommunication Standardisation Bureau, Chaesub Lee said: “We are keenly aware of the enormous opportunities and responsibilities that lie ahead if we are to realize the full potential of innovation in fields such as 5G, Artificial Intelligence, Connected Cars, Digital Financial Services, the Internet of Things and Smart Cities. Realizing this potential will demand that ICT stakeholders collaborate closely to build trust and security in the use and application of new technologies. International standards will support this collaboration, encouraging greater scale, interoperability and competition, all of which directly determine universal affordable access.”

$55: 2017 Oil Price Forecast by World Bank

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Business Journal

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26/10/2016

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The World Bank is raising its 2017 forecast for crude oil prices to $55 per barrel from $53 per barrel as members of the Organisation of the Petroleum Exporting Countries (OPEC) prepare to limit production after a long period of unrestrained output.

Energy prices, which include oil, natural gas and coal, are projected to jump almost 25 percent overall next year, a larger increase than anticipated in July. The revised forecast appears in the World Bank’s latest Commodity Markets Outlook. Oil prices are expected to average $43 per barrel in 2016, unchanged from the July report.

“We expect a solid rise in energy prices, led by oil, next year,” said John Baffes, Senior Economist and lead author of the Commodity Markets Outlook.

“However, there is considerable uncertainty around the outlook as we await the details and the implementation of the OPEC agreement, which, if carried through, will undoubtedly impact oil markets.”

A modest recovery is projected for most commodities in 2017 as demand strengthens and supplies tighten.

Metals and minerals prices are expected to rise 4.1 percent next year, a 0.5 percentage point upward revision due to increasing supply tightness. Zinc prices are forecast to rise more than 20 percent following the closure of some large zinc mines and production cuts in earlier years. Gold is projected to decline slightly next year to $1,219 per ounce as interest rates are likely to rise and safe haven buying ebbs.

Agriculture prices are expected to increase 1.4 percent in 2017, slightly less than expected in July, as food prices are projected to climb more gradually than anticipated (1.5 percent) and beverage prices are seen dropping by a greater extent (0.6 percent) on expectation of a large coffee output. Among food prices, grains prices are forecast to rise a steeper-than-anticipated 2.9 percent next year, while oils and meals prices are anticipated to rise a slower-than-expected 2 percent.

“Low commodity prices hit commodity-exporting emerging and developing economies hard but now appear to have bottomed out,” said AyhanKose, Director of the World Bank’s Development Prospects Group.

“Growth in this group of economies is expected to be near zero for the year. Where feasible, policy-makers should pursue growth-enhancing strategies, such as investments in infrastructure, health and education, in the context of a credible medium-term fiscal plan.”

This edition of the Commodity Markets Outlook contains a Special Focus analysing OPEC’s recent announcement of plans to limit production.

Historically, agreements aimed at influencing the prices of commodities such as tin and coffee have succeeded in swaying markets for a time but eventually lost that ability and collapsed. OPEC’s ability to affect oil prices is likely to be tested by the expansion of oil supply from unconventional sources, including shale producers.

The World Bank’s Commodity Markets Outlook is published quarterly, in January, April, July and October.

The report provides detailed market analysis for major commodity groups, including energy, metals, agriculture, precious metals and fertilisers. Price forecasts to 2025 for 46 commodities are presented along with historical price data.

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