AfDB, Japan Unveil $3bn Anti-Poverty Private Sector Initiative in Africa

28/08/2016

The African Development Bank (AfDB) and the Government of Japan announced today they have set a joint target to provide US$ 3 billion for private sector development in Africa during the next three years, substantially increasing the resources devoted to boosting economic growth and fighting poverty in the region. The resources will be provided under the third phase of the Enhanced Private Sector Assistance for Africa (EPSA) initiative.

Japan will target to provide US$ 1.5 billion over 3 years through the Japan International Cooperation Agency (JICA). The AfDB expects to finance at least an equal amount. On top of this, Japan is ready to provide an additional special allocation of US$ 300 million for co-financing with the AfDB to help African countries access the best low emitting clean coal technologies available.

“AfDB and Japan have agreed today to upgrade the joint EPSA initiative, which has been at the core of our long-standing partnership, helping boost private sector-led growth in Africa”, said Japan’s State Minister of Finance Taku Otsuka. “We look forward to continued close collaboration with the AfDB so as to further accelerate the development of the African private sector, by delivering resilient and high-quality infrastructure and strengthening the health system.”

“This is a significant expansion of our support to the private sector, which will play a critical role in Africa’s economic transformation,” said AfDB President, Akinwumi Adesina.

“The scaling up of the Enhanced Private Sector Assistance for Africa Initiative will help increase access to electricity, boost the industrialization of the continent and improve the quality of millions of lives in Africa. These are all key components of our High 5s. We are proud to partner with Japan, one of our key strategic partners, in this endeavor.”

The High 5s are the Bank’s five areas of focus to advance the agenda of Africa’s economic transformation over the next 10 years: Light up and Power Africa, Feed Africa, Integrate Africa, Industrialize Africa, and Improve the quality of life for the people of Africa.

Announced at the first-ever TICAD Summit held on African soil, the third phase of EPSA will focus on economic infrastructure (transport, energy, etc.) as well as social infrastructure (health, education, nutrition). EPSA was launched at the G8 Summit in Gleneagles in 2005.

Its scope has been expanded to include sectors such as education and health, which also contribute to promoting private sector development. Japan provided the equivalent of US$ 1 billion of concessional loans under EPSA-1 (2005-2011) and is providing US$ 2 billion under the current EPSA-2 (2012-2016).

The Enhanced Private Sector Assistance for Africa Initiative has played a key role in the development of regional infrastructure. It has helped increase the AfDB’s private sector operations, which have expanded nearly ten-fold over the lifespan of the first phase and almost doubled since the start of EPSA 2.

Background

The Enhanced Private Sector Assistance for Africa (EPSA) Initiative is a framework to support implementation of the AfDB’s Strategy for Private Sector Development. Designed in partnership with the Government of Japan, it draws on successful experiences in Asia and around the globe. It is built around three components:

The Accelerated Co-Financing Facility for Africa(ACFA) is a sovereign co-financing arrangement between AfDB and JICA, where JICA lends on preferential terms to borrowers under this scheme.
The Non-Sovereign Loan (NSL) is a line of credit from JICA to AfDB on concessional terms to help fund the Bank’s private sector operations.
The Fund for African Private Sector Assistance(FAPA) is a Multi-Donor Trust Fund for technical assistance and capacity building for the Bank’s public and private sector clients. The Government of Japan is the major contributor to the Fund, which is managed by the AfDB.

World Bank, Partners Launch $24bn Universal Health Coverage in Africa

Business Journal

28/08/2016

The Sixth Tokyo International Conference on African Development (TICAD-VI), African heads of state and partners vowed to accelerate progress toward universal health coverage (UHC) in Africa.

To help countries implement their health reforms, the World Bank and the Global Fund to Fight AIDS, TB and Malaria (Global Fund) committed to invest $24 billion in Africa over the next three to five years.

The announcement was made ahead of the two-day TICAD conference, which is Japan’s flagship program for African development. One of the focal points at this year’s conference is expanding UHC in Africa.

“African countries can become more competitive in the global economy by making several strategic investments, including investing more in their people, their most prized resource,” said Jim Yong Kim, President of the World Bank Group. “A critical part of this commitment is to accelerate progress on universal health coverage—ensuring that everyone, everywhere has the opportunity to live a healthy and productive life.”

The World Bank and the World Health Organisation (WHO), together with the government of Japan, Japan International Cooperation Agency, the Global Fund, and the African Development Bank also launched UHC in Africa: A Framework for Action, which provides a big-picture view of UHC in the region and identifies key areas that will be critical to achieving better health outcomes, such as financing, service delivery, targeting vulnerable populations, mobilizing critical sectors and political leadership.

“At the G7 Ise-Shima Summit in May, bearing this TICAD in mind, I took initiative in leading the discussion on reinforcing the global health architecture, which will strengthen responses to public health emergencies, and on promoting UHC, which will also contribute to crisis preparedness,” said Shinzo Abe, Prime Minister of Japan.

“‘UHC in Africa’ will present guidelines and concrete framework for action that will serve as references for achieving UHC under the ownership of respective countries, as well as by cooperation among the international society.”

The funding announcements by the World Bank and Global Fund are one of several steps in the years ahead toward UHC in Africa. To that end, the government of Japan will support the World Bank and WHO’s annual report to track UHC progress in Africa.

The World Bank and WHO have agreed to hold in 2017 in Tokyo a high-level annual meeting on monitoring progress toward UHC in Africa.

Through its International Bank for Reconstruction and Development and International Development Association windows, the World Bank Group expects to contribute $15 billion in the next five years to investments that are critical to UHC, including through the Global Financing Facility, the Power of Nutrition, early childhood development, pandemic preparedness, targeting the poor, crisis preparedness and response, and leveraging the private sector. The commitment assumes a successful IDA 18 replenishment.

The Global Fund’s $9 billion commitment for 2017 through 2019 includes $6 billion of investments in programs that treat and prevent HIV, TB and malaria, and also includes $3 billion of investments in systems for health such as strengthened procurement systems and supply chains, improved data quality and data management systems, and strengthened human resources for health. The commitment assumes a $13 billion Global Fund replenishment, which launches in September 2016.

“Reducing and preventing HIV, TB and malaria is critically important to alleviate the burden on health systems, but in order to accelerate universal health coverage and all of the health SDGs, we also are actively investing to build resilient and sustainable systems for health,” said Mark Dybul, Executive Director of the Global Fund to Fight AIDS, Tuberculosis and Malaria.

Although the evidence is clear that investing in health pays dividends for countries, challenges remain in the delivery and financing of health care.

“In 2014, African countries spent about $126 billion of domestic funding for health, and WHO estimates that an additional $65 to $115 billion in domestic funding can be mobilised annually over the next ten years,” said Margaret Chan, Director-General of the World Health Organization.

“WHO is working with countries in Africa to generate those funds and help them shape the policies that will put them to best use.”

The World Bank Group, government of Japan and private sector partners recently launched the Pandemic Emergency Financing Facility, an innovative, fast-disbursing global financing mechanism designed to protect the world against deadly pandemics, which will create the first-ever insurance market for pandemic risk. It also will promote greater global and national investments in preparing for future outbreaks and strengthening national health systems.

IEI Anchor Pension: N55bn Pension Assets, 90,000 RSAs, 23 States

Business Journal

25/08/2016

L-R: Mr. Modestus Anaesoronye, President, National Association of Insurance and Pension Correspondents [NAIPCO], Mr. Glory Etadiovue, Managing Director/CEO, Jolaade Oduntan, Head, Business Development & Strategy and Mr. Cyril Ojo, Regional Manager; all of IEI Anchor Pension Managers Limited at NAIPCO AGM in Lagos yesterday.

IEI Anchor Pension Managers Limited is currently managing pension assets of over N55 billion in its portfolio from 90, 000 Retirement Savings Account [RSA] holders in 23 states of the federation.

Mr. Glory Etaduovie, Managing Director/CEO, IEI Pension Managers Limited said the company’s growth pace is faster now as it continues to gain more ground in the pension market. He said the growth plan of the company is aggressive increase in the number of RSAs.

“Effective market delineation, deployment of our marketing philosophy and drilling down, marketing tools to promote presence and efficiency and presence and importantly, good staff motivation and a sense of security are also part of the growth plan.

Investment wise, the regulator plays a key role. We have major investment guidelines. This ensures relative fund safety. This is the future of many people. So, there is no room for un-necessary adventure.

However, the market presents good opportunities and initiatives – a good blend of Bonds, Treasury Bills, Money market and other safe investments. Private Equity and Infrastructure development are new areas of gradual action.”

On market spread, the IEI Anchor Pension CEO said:

“We have good presence in 23 states of the federation. The market presently has two major strata – private and public sectors.

The public sector includes the states and federal. Not many states have latched on to the Contributory Pension scheme, though. We are also positioning in areas with strong potentials. Our RSA client size is over 90, 000 contributors.”

He added that IEI Anchor Pension is competing effectively in the market. “One thing stands out, the customer remains the ultimate and determinant of direction. Our size makes us nimble and smartly responsive.

This is one advantage we wield. Everyone gets deserved attention. This we pursue to achieve through training and retraining of staff. An informed and engaged staff is a real asset.”

He described the pension industry as interesting and exciting. “Regulation is strong. The market is only about 30 percent explored. It is also a form of social service. You also derive strong satisfaction when you support the aging with good service, as well as prepare them for graceful retirement. The industry is not over – populated.

This is good for control and sanity. If there is ease of entry and exit, it would create grave danger for it. Contributory pension activities are relatively new. It presents its own challenges. But the collaborative style of the industry makes responses better put together. It is getting stronger and stronger.

It is going to be a critical tool for development shortly. It is positioning. The government is aware of this and seeing it as a partner in progress. It is thus cautiously positioning for collaborative activities. There is a serious gap in infrastructure. This affects other growth and development.”

Etaduovie listed ICT as having a critical role in the success of the pension industry due to the large number of people, records, funds and other statistical details for analysis and decision making.

“This greatly reduces human errors and increases efficiency and effectiveness. It also creates respect for the industry at large, if there are less complaints.The industry regulator recommends at different intervals, new ICT needs. This is apart from individual corporate initiatives

We have deployed much of the needed ICT needs. Presently, we are focused on this for further improvements and action. This enhances customer service, enquiries and enhanced interaction for better satisfaction. People want constant up-dates as to the safety of their money and what the money is doing.”

On the challenges facing the new pension scheme, Etaduovie said:

“These are acceptability, transition, harnessing the informal sector and the economy. Some persons of the old scheme are yet to come to terms with the contributory scheme. Such ones, if in good position stand in the way of implementation. Transition challenges for states because of the old scheme and backlogs.

In other instances, we have the bureaucracy of domesticating the PRA in the states. The poor business environment is also affecting private section adoption and implementation. Some who do, do not remit the staff deductions or theirs as well. This is immoral and they risk penalty from the regulatory body.

All of these challenges and others are constantly being reviewed by the industry. The Director General and her team are keeping close eyes on details, as the industry matures.”

Nigeria Seeks $21bn China Loan to Finance Budget

Business Journal

24/08/2016

Udoma Udo Udoma, Minister of National Planning

Nigeria’s Minister of Budget and National Planning and Senator Udoma Udo Udoma announced following its visit to China last July, that the country was in talks with the Chinese import-export bank China Exim Bank for a $21 billion loan to finance its 2016 budget and develop new infrastructure projects.

The loan, if secured, should allow the country to plug its budget deficit which has been estimated at $11.1billion and finance infrastructure projects to boost economic growth.

According to the same source, the Chinese bank has already granted Nigeria a loan of $1.8 billion. Moreover, in April 2016, during President Buhari’s visit to China, Beijing agreed to lend the West African nation $6 billion to finance its infrastructure development programme.

Nigeria, which recently lost its position of leading economy of the continent, is presently facing an economic crisis fostered by Naira’s plunge, the drop in oil prices, sabotaging of oil infrastructures, capital outflow and terrorism.

The nation’s overall debt stood at $55 billion on December 31, 2015 of which $10.9 billion of external debt and $44 billion of internal, according to the country’s debt management Bureau.

The financial aid which is part of China’s commitment to invest $60 billion in Africa to support 10 cooperation progammes over three years, at the last Forum on China-Africa Cooperation (FOCAC) held in Johannesburg in December 2015.

Alain Okpeitcha

FG to Invest $1.5bn in National Transmission Power Network

Business Journal

24/08/2016

The Federal Government of Nigeria said it will inject in its national power transmission network $1.5 billion by 2019.

The investment falls under a 5-year extension programme implemented by the Transmission Company of Nigeria (TCN) and which aims to increase the network’s transmission capacity to 11,500 MW.

This will be achieved through the step-by-step implementation of 59 projects. TCN has indeed increased in 2016, its capacity from 5,500 MW to 6,000 MW. It now wishes to raise intermediate transmission capacities from 7,500 MW in 2017, to 8,200 MW in 2018.

Cost for associated works was estimated to $7.5 billion. Besides government’s contribution of $1.5billion, the TCN hopes to secure around $3.4 billion from international institutions, and via loans and subsidies. It will add to these, $2.6 billion from its own revenues.

The various contributions are part of a collective effort by actors of the Nigerian power sector to improve it.

To this end, the Nigerian Bulk Electricity Trading and the Central Bank of Nigeria are currently in talks for an additional funding of about $547 million which will be used to boost revenue of power developers that serve the nation.

Nigeria recently lost its position of largest African economy, and presently produces around 4,100 MW for an estimated demand of 12,000 MW.

Gwladys Johnson

Business, Risk Leaders to Meet in Lagos Oct 2O

Business Journal

24/08/2016

Leading risk management and insurance players, including key regional insurance regulators, from across West Africa will be taking part in Commercial Risk Africa’s Risk Frontiers – West Africa: Driving the risk management agenda one-day seminar in Lagos on October 20th, 2016.

Economic growth in Sub Saharan Africa (SSA) has been one of the defining trends in frontier markets. Economies that had been dormant for years have emerged to attract billions of pounds of foreign investment into their natural resources, infrastructure and consumer goods sectors.

Despite declining oil prices and an economic slowdown in China, the economy of SSA is still set to grow. It is also the fastest growing insurance region, behind emerging Asia, with premium growth of 4.5% to 5% expected in 2016 and 2017.

However, as the business environment changes at a rapid pace, it is essential for business to maintain a disciplined risk management approach. This unique one-day event provides an unparalleled opportunity for risk practitioners to interact with specialists from across the world.

Led by insurance regulator, Mohammed Kari from NAICOM, the event will focus on the challenges for businesses in maintaining compliance in a fast changing regulatory environment.

Delegates will also hear from the experts about how to manage the rapid depreciation of African currencies, both from a local and international perspective.

Other issues to be explored include:

Political risk & political violence;
Global legacy and sustainability issues;
Broad financial risk;
Operational risks; and
Risks around human capital and the skills gap.

The unique event will bring together risk practitioners from across the region to meet with both local and international experts, to share best practices and exchange their knowledge.

To ensure you don’t miss out on this free to attend event at the Four Points by Sheraton, Victoria Island, register at: http://www.commercialriskeurope.com/rfwestafrica16.

BREXIT and the African Sunset!

Business Journal

24/08/2016

Theresa May was sworn in as Prime Minister of the UK and her opening speech resounded around the world and the British Pound recovered against the SA Rand and most currencies but was this just a blip.

So what does this mean to us in South Africa and what impact will this have on our struggling economy or Africa as a whole?

Well- Boris Johnson was appointed UK foreign Minister

If you recall, The Africans For Britain Group, who supported the Brexit because the group had argued that Britain leaving the EU would encourage trade with African and Caribbean nations and make it easier for people from those countries to travel to the UK.

So- where are they now? And what is their response? Silence is deafening.

So- can we expect the same see-saw or will the Pound make a brief comeback as decisions get made and more UK announcements are made?

What is for certain is that we will see more announcements being made on trade in the African continent from both the EU and I suspect the UK changes will happen too.

Some analysts have stated that the Brexit would surely weaken trade ties between the U.K. and African countries and with their over 100 trade agreements, this will result in lengthy processes, which could cause a decrease in trade volumes with the UK, but an increase in trade volumes with the EU.

We need to keep in mind that statistics from the UK’s Office for National Statistics and the United Nations Conference on Trade and Development for 2014, only 18 months back, it is calculated that exports from Africa to the UK represent about 5% of Africa’s total exports and that Africa is actually more worried about China’s slowdown, its biggest trading partner by far, than that of the UK.

So- Africa itself needs to focus on the EU as an export partner.

We know that the East African Community and the EU are due to sign an Economic Partnership Agreement in October and there are probably other agreements in the pipelines for countries.

South Africa has the UK based agreements in the Mining and Financial sector but these are in themselves not self-sustaining and job creation which is what is needed, more likely they are self-gain based.

So, financial- the bet lies on the EU and Africa – we need to manage this and watch the growth and changes, if the UK makes a move, the effect lies externally and not on us, we will flinch, but remain resilient.

About the Author

Chris Green – Financial Entrepreneur
[email protected]
A forerunner with Mortgage Origination in South Africa.

Established the first mortgage independent company in the UAE – Middle East.

Managed lead generation in the Money transfer industry internationally.

Studied Marine Radio, IT and Finance. Has expertise in IT technology background consulting in Database Management and Software Design.

Introduced the first artificial intelligence testing system for computer programmers into South Africa.

Has presented various papers and products in Dubai, New York, Boston, London, Dublin, Milan, Turin and Paris on subjects ranging from Darkroom Operations for IT to Creating Finance modules for Property Letting.

Currently an avid blogger, gatherer of information and loves politics, finance and the future.

His hobbies include making grappa, being a sous chef (foodie) to his chef wife and reads everything he can.

‘Why Old Mutual is Investing Millions in Nigerian Property & Agriculture’

Business Journal

24/08/2016

This month, South African financial services firm, Old Mutual Investment Group announced a partnership with Nigeria’s sovereign wealth fund for the investment of US$700m in real estate and agriculture.

According to Diane Radley, CEO of Old Mutual Investment Group, $500m will focus on developing commercial real estate assets, while $200m will be allocated to farming. Both parties have equally committed $100m towards the real estate fund and $50m for the agriculture investment.

“We’ve put the initial capital into both the funds on a 50-50 basis… and we will look to source international and other local investors to come into the fund to make up the balance,” she toldHow we made it in Africa.

The fall in global oil prices has hit the West African powerhouse hard – oil exports make up the majority of government revenue. In June, the Central Bank of Nigeria was forced to unpeg the naira from the dollar and adopt a market-driven exchange rate system due to a scarcity of the US currency in the country. The naira has since lost around a third of its value.

However, despite these struggles, Radley said Nigeria’s long-term outlook presents an “enormous opportunity” for investors.

“There is an incredible will at a federal level to open up the economy to start growing and to attract investors into the economy. And that bodes very well for anybody who is looking at the long-term investor horizon.

“The demographics and fundamentals of Nigeria in the long term are a no-brainer.”

Radley added Nigeria’s commercial real estate space offers high-yield investment opportunities and the fund will look at properties with a dollar-income yield of about 8%.

“The three most-significant cities – Lagos, Port Harcourt, and Abuja – offer the biggest opportunities, with Lagos and Abuja being the two biggest areas of opportunity. So we will naturally concentrate our interest on those two. And partnering with the Nigeria Sovereign Investment Authority gives us a local player on the ground who will also be able to identify where opportunity arises and point us in that direction.”

The joint investment in agriculture will look at everything from dairy to citrus to beans, and Radley said there is significant opportunity to improve the country’s farming yields and better address rising consumer demand domestically, regionally and globally.

“For example, we are looking at a farm at the moment, which is fairly substantial in size, where less than 25% of the land is actually productive. So you’ve got an enormous opportunity to expand the level of productivity from that 25% to 80% or 90%.”

Radley added the dual investment in Nigeria’s agriculture sector is anticipating returns of around 20% – which is not easily found in Old Mutual’s home market.

“If you want to get close to the 20% yield, investing in South African farmland is not going to get you there,” she explained.

“One of the things about African agriculture is you need to diversify your investment… We are not going to put all our money into one farm.

“So it is not without risk, but the returns are very reasonable relative to that risk.”

Kate Douglas

Flydubai at Dubai Tourism East Africa Roadshow

Business Journal

24/08/2016

Dubai-based airline flydubai is participating in Dubai’s Department of Tourism and Commerce Marketing’s (Dubai Tourism) first-ever East Africa roadshow joining 14 Dubai-based partners in showcasing a wide range of services and upcoming attractions.

flydubai will take part in the roadshow in Kampala on 24 August, where it will then continue to Dar es Salaam on 30 August.

The roadshow is a great platform for local operators to meet directly with the airline and learn first-hand about the services and choices passengers from the market have when choosing to fly directly to Dubai for business or leisure.

Commenting ahead of the roadshow, Issam Kazim, CEO at Dubai Tourism, said: “The potential of Uganda and Tanzania as a source market is positive, and this roadshow provides us with the opportunity to directly interact with the operators here and showcase what Dubai has to offer. We look forward to making long-lasting and fruitful trade relationships during the trip to further grow the tourism market in Uganda for the benefit of all.”

flydubai was launched in 2009 to help create free flows of trade and tourism in the region and further support Dubai’s vision to become an internationally recognised aviation and tourism hub. flydubai’s reliable, affordable and high quality product offering with both business and economy classes, makes it possible for more people to travel more often to Dubai.

Sudhir Sreedharan, SVP Commercial Operations at flydubai (GCC, Africa & Indian Sub-Continent), said: “We are very pleased to take part in Dubai Tourism’s first-ever roadshow to East Africa and to showcase brand Dubai and flydubai. We are committed to opening up underserved markets and providing reliable, direct air links to destinations that previously had no or very few connections to Dubai.

East Africa is a very important market that has shown significant growth over the past few years. We currently operate 82 weekly flights to 11 points in Africa, including 3 weekly flights to Entebbe and 4 weekly flights to Dar es Salaam and Zanzibar. These weekly frequencies will increase to 4 flights to Entebbe and 7 flights to Dar es Salaam and Zanzibar from October.”

flydubai currently flies to 11 destinations in North and East Africa: Addis Ababa, Alexandria, Asmara, Dar es Salaam, Djibouti, Entebbe, Hargeisa, Juba, Khartoum, Port Sudan and Zanzibar.

Business Class is available on most of the routes on the flydubai network and the carrier has recently introduced WiFi and Live TV on select flights.

The carrier, which is the second largest operator out of Dubai International, has built a network of 90 destinations in 44 countries and operates more than 1,700 flights a week out of it is home in Dubai International (DXB), Terminal 2 and the newly opened Al Maktoum International- Dubai World Central (DWC)

Global ICT Capacity Building Symposium for Human Dev

Business Journal

24/08/2016

Local and international journalists are invited to submit their credentials for official media accreditation for ITU’s upcoming Global ICT Capacity Building Symposium (CBS-2016), which will take place in Nairobi, Kenya, from 6 to 8 September 2016.

The symposium is organised by ITU, the UN specialised agency for information and communication technologies (ICTs) and hosted by the Government of Kenya under the theme “Embracing Capacity Building Opportunities in the Digital Era”.

It brings together thought leaders from all over the world including government ministers, Directors-General of regulatory authorities, heads of UN organisations, CEOs of private sector companies, representatives from universities and research institutions, human capacity building executives and other experts in ICT capacity building.

The programme focuses on how education and training in the field of ICTs will contribute to the timely attainment of the SDGs across all sectors, including:

New skills requirements in a changing world – investing in tomorrow’s workforce
Innovative tools for education and learning
New digital learning methodologies, including online learning, social media tools and massive open online courses (MOOCs)
The central role of academia in building skills in the digital era.Day One(6 September) will feature a Ministerial Roundtable on ICTs, Sustainable Development Goals and future priorities for capacity building, and a Leaders’ Dialogue on public policies, industry skills requirements, and the role of academic institutions as providers of education and skills.

CBN Bars UBA, First Bank, FCMB from Forex Transactions

Business Journal

24/08/2016

The Central Bank of Nigeria [CBN] yesterday barred United Bank for Africa [UBA], First Bank of Nigeria, First City Monument Bank [FCMB] and six other banks from all forms of foreign exchange transactions in the country until they remit all funds in their possession to the Treasury Single Account [TSA].

The CBN warned that the suspension of the banks will remain in force until they remit such funds.

Below is the list of banks barred by the CBN and the amount standing against them:

United Bank for Africa (UBA) -$530m;
First Bank of Nigeria (FBN)- $469m;
Diamond Bank Plc-$287m;
Sterling Bank Plc-$269m;
Skye Bank Plc -$221m;
Fidelity Bank -$209m;
Keystone Bank- $139;
First City Monument Bank (FCMB) -$125m
Heritage Bank-$85m

NEXIM Bank Partners Bauchi State on Non-oil Export

Business Journal

24/08/2016

Mr. Bashir M. Wali, the Acting MD/CEO met with the Executive Governor of Bauchi State, His Excellency, Mohammed Abdullahi Abubakar at the State Liaison Office in Abuja to discuss opportunities to collaborate with the State towards boosting export-oriented investments in agro-processing, solid minerals and solid minerals, especially under the N500 billionExport Stimulation Facility (ESF) and the N50 billion Export Rediscounting and Refinancing Facility (ERRF).

NEXIM Bank Partners Bauchi State on Non-oil Export — L – R: Mr. Bashir M. Wali, Acting MD/CEO, NEXIM Bank and His Excellency, Mohammed Abdullahi Abubakar

Welcoming Wali and his team, the State Governor expressed his appreciation for the August visit and provided a snapshot of Bauchi State, especially its resources and other potentials.

According to Governor Abubakar, Bauchi State covers a total land area of 49,259.01 square kilometres which represents about 5.3% of Nigeria’s total land mass, making it one of the largest states in the country.

He informed Wali that agriculture is the mainstay of over 80 per cent of people who reside in both urban and rural areas with products ranging from maize, rice, millet, groundnut and guinea corn. Additionally, cattle and other livestock are reared at a commercially viable level.

In terms of solid minerals, Governor Abubakar indicated that the State has commercial mineral reserves comprising of Amethyst, Gypsum, Lead/Zinc, Uranium, Limestone, Kaolin, Gypsum, Antimony, Iron Ore, Gold, Marble, Columbite and Zinc; precious stones like Sulphur, Amities and Aquamarine among others. In addition to this, Bauchi has a manufacturing sector covering Iron and Steel, Water, Ceramics, Food and Beverages etc.

The Governor, however, identified certain constraints that have hindered the commercial exploration of the solid minerals in the State. These include the issues of licensing – considering that solid minerals is on the exclusive list; the paucity of data in terms of certification of available deposits; and the need to efficiently organise artisanal mining as well as establish beneficiation centres to boost the solid mineral value-chain in the State.

Concluding, Governor Abubakar indicated that one of the most viable potentials in the State is the tourism sector.

Bauchi is home to the Yankari Games Reserve (the biggest games reserve in West Africa), occupying an area of 2,224.59 square kilometres. Other notable tourist centres in the State include the Premier Game Reserve, Rock Paintings, the First Mining Beacon of Tilden-Fulani, the Panshanu Stone Heaps, Lame-Burra Game Reserve, Sumu Wildlife Park, Geji Rock Paintings of the Neolithic age, the Babban Gwani Architectural Designs at Bauchi and Kafin Madaki and the International Bird Sanctuary of Udubo district.

The Acting MD of NEXIM thanked Governor Abubakar for receiving the Bank’s team at short notice and informed that the Bank was established to promote export diversification and deepening the non-oil export sector.

Accordingly, the Bank’s current strategic initiatives are targeted towards boosting employment creation and foreign exchange earnings in the Manufacturing, Agro-processing, Solid Minerals and Services – Tourism, Transportation and Entertainment sectors. This is the MASS Agenda of NEXIM Bank.

Wali used the opportunity to inform the Governor that NEXIM Bank recently launched a N500 billion Export Stimulation Facility (ESF) and the N50 billion Export Rediscounting and Refinancing Facility (ERRF) which were provided as intervention funds by the Central Bank of Nigeria (CBN) as part of efforts of the Federal Government to address the persistent overdependence of the economy on revenue from crude oil export.

Narrating on the guidelines to Governor Abubakar, Wali indicated that all applications under the intervention schemes are expected to be submitted through commercial banks or other development finance institutions.

After a satisfactory review of the applications in line with the eligibility criteria provided in the CBN guidelines, the PFIs will then forward such applications to NEXIM. The Bank will in turn do a further review of the applications within a period of time not exceeding 20 working days before forwarding the applications to the Central Bank of Nigeria for approval and funding.

In terms of cost, the ESF comes at a maximum interest rate of 7.5% for short-tenored transactions spanning up to three years, and 9% for longer term transactions that are up to 10 years. The RRF on the other hand comes at a maximum all-in cost interest rate of 6%.

However, considering that NEXIM Bank does not lend directly to government institutions, Wali suggested that the government should explore funding options with the Islamic Bank, Afrexim Bank or other such institutions at that level, while commercial proposals would be welcome from the private sector entities in the state for accessing facilities from the Bank. He subsequently presented the ESF/RRF guideline documents to the Governor.

Thanking the NEXIM MD, Governor Abubakar indicated that the courtesy visit was a step in the right direction and promised that arrangements would soon be put in place to have NEXIM Bank formally come to Bauchi State to meet with the state officials towards taking the conversation forward.

Nigeria in Top 5 Most Attractive African Countries for Global Investors

Business Journal

24/08/2016

In Africa, the five most attractive nations for international investors are Ethiopia, Nigeria, Morocco, Ghana and Senegal. This was revealed in the latest study of consulting firm Havas Horizons and the Choiseul Institute covering 2016 to 2020 and entitled “Financing African Growth by 2020: Global Investors’ View.”

In the framework of the study, 55 global investors active in Africa including the Bank of America, BNP Paribas, Edmond de Rothschild, Proparco, Qatar national Bank, Rothschild & Cie, Standard Bank, Goldman Sachs, HSBC, Merril Lynch, Attijariwafa were surveyed.

75% of surveyed population is optimistic regarding Africa’s global economic outlook in 2016 while 91% are in the mid and long term by 2020.

Global lenders’ optimism in the continent despite slowdown of economies spurred by oil and commodities decline is explained by a better business climate, structuring of free-trade areas, development of inter-African commercial relations, demographic growth and emerging middles classes, the study stated.

Favored by 52% of surveyed investors, Ethiopia leads the previous top 5. Over the past 10 years the country has developed significantly with an average annual growth exceeding 8%, one of the highest growth rates over the continent. It also invests massively in infrastructures (energy, railways, roads, etc.) and intends to become a reference industrial hub.

Nigeria comes next with 44% of the surveyed. Despite the various crisis that the West African giant currently faces (namely Boko Haram, oil slump, Niger Delta Avengers), remains confident in its investors, especially in regards to the challenge of diversification of the economy ahead.

However, Nigeria just lost its place as the continent’s leading economy and now plans to be no more oil-dependent.

Grabbing 23% of the surveyed investors, Morocco is third in the ranking.

Enjoying evident tourism assets, proximity with Europe, infrastructures of quality, major investments in solar and wind energy, and an economy which is driven by a manufacturing industry focused on export and the multiplication of free-trade agreements the Cherifian kingdom is eyed by many investors.

Ghana is fourth with 21% of surveyed population. Accra in addition to its political stability launched major regional projects for roads and ports. It relies on its average class, agriculture, construction, and infrastructures and aims to become a commercial link between Cote d’Ivoire and Nigeria, West Africa’s largest top two economies, Havas’ study indicates.

Senegal comes last in the ranking with 19% of the surveyed population. Dakar benefits from the “positive impacts of the gradual transformation of its economy through the development of the finance, telecommunication and new technology sectors, as well as a diversified economy which is based on agriculture, agro-food and tourism,” the study highlights while also emphasizing the country’s political stability and the implementation of the Plan for an Emerging Senegal (PSE in French).

Alain Okpeitcha

NSE, Bloomberg Set for 2nd CEO Roundtable Aug 31

Business Journal

24/08/2016

Oscar Onyema, CEO, Nigerian Stock Exchange

The Nigerian Stock Exchange (NSE) in collaboration with Bloomberg is set to host the 2nd NSE Bloomberg CEO Roundtable Event on Wednesday, 31st August 2016 at the Stock Exchange House, Marina, Lagos.

The CEO Roundtable themed “Navigating the Changing Business Landscape in Nigeria” will bring together thought leaders and captains of industry to share in-depth knowledge about their sectors with capital market players and proffer much needed solutions to economic realities. The panel at the event will feature CEOs from the financial services, telecommunications and manufacturing sectors; CEOs from portfolio management firms and renowned economists.

Some of the confirmed speakers for the event include: Oscar N. Onyema – CEO, NSE, Segun Ogunsanya – CEO, Airtel Nigeria, Bolaji Balogun- CEO, Chapel Hill Denham, Mark Bohlund – Senior Economist, Africa and the Middle East, Bloomberg Intelligence and Uk Eke – GMD, FBN Holdings.

Speaking on the event, Oscar N. Onyema, Chief Executive Officer, NSE, said:

“The CEO Roundtable is in line with the commitment of the Exchange to provide a platform that ensures continuous dialogue to provide practical solutions for companies operating in Nigeria. The headwinds that have befallen the Nigerian economy presents an opportunity for businesses to take a step back, access the current situation and plan accordingly. It is expected that this event will critically examine the changes in the business landscape, highlight their impact and propose solutions that will enable businesses thrive and survive in the current environment”

“Bloomberg is working more closely than ever with key financial institutions and stakeholders in countries like Nigeria to help them grasp opportunities, tackle challenges, and bring more transparency to capital markets,” said Selloua Chakri, Head of Market Structure Strategy, Bloomberg.

“We’re delighted to partner with the NSE again to convene this prestigious group of business leaders for what will no doubt be a fascinating and informative discussion.”

The event will feature a panel session on the theme and will centre on financing capital projects & the real economy in the current environment, policy measures needed to grow the manufacturing sector’s contribution to the economy and maintaining & attracting foreign investment through the downturn. There will also be a macro-economic review to guide discussions.

About THE NSE

The Nigerian Stock Exchange, a company limited by guarantee, services the largest economy in Africa and is championing the development of Africa’s financial markets. The Exchange offers listing and trading services, licensing services, market data solutions, ancillary technology services, and more.

The Nigerian Stock Exchange continues to evolve to meet the needs of its valued customers, and to achieve the highest level of competitiveness. It is an open, professional and vibrant exchange, and the Entrepreneurial Growth hub of Africa.

The Nigerian Stock Exchange aspires to be Africa’s foremost securities exchange, connecting Nigeria, with the rest of Africa and the world.

About Bloomberg

Bloomberg, the global business and financial information and news leader, gives influential decision makers a critical edge by connecting them to a dynamic network of information, people and ideas. The company’s strength – delivering data, news and analytics through innovative technology, quickly and accurately – is at the core of the Bloomberg Professional service, which provides real time financial information to approximately 325,000 subscribers globally.

Silk Road on Rails: The China-Europe Block Trains

Business Journal

24/08/2016

The biggest story coming out of China today is the launching of the Silk Road on Rails: China-Europe block trains that carry goods across the globe. The proposal to establish China-Europe railroads surprised even the most experienced of rail industry players, yet thousands of trains now traverse these tracks annually.
Not least surprised was the Director of Operations at the Hamburg Eurogate terminal, Thorsten Reese, who remarked, “Three years ago, I couldn’t imagine Germany and China being connected with rail cars; it is unbelievable!”
The China-Europe rail route is the longest in the world covering some 10,000 kilometres in total.
The first block train left Zhengzhou for Hamburg on July 18th, 2013, connecting people along the Silk Road and shortening the distance between continents. The 12-day, six-country journey posed challenges: would European companies welcome the new trade route? Would the cargo be secure? Would the project even be practical.
The trans-Eurasia rail trip began as a once-a-month event but China soon realised it required partners to make it successful. With partners on board, Hamburg became the forerunner. The German port city now serves as both a departure and destination point for the China-Europe block trains.
Thanks to a highly motivated Chinese workforce, Mr. Reese sees the cargo arrive safely and on time. The China Train employees are an enthusiastic group and make sure the trains are loaded and off-loaded on schedule.
The Hamburg Chamber of Commerce came on board after realizing the potential in the Silk Road Rail project. The Chamber’s MD, Corinna Nienstedt, did not mince her word when she said: “It is a new opportunity to transport between Hamburg on one hand, and Europe on the other hand, from China”.
This project has lowered the cost of transportation significantly and commerce is thriving. There is no doubt about the initiative’s acceptance.”

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