MTN Group crisis in Nigeria may cost some high-ranking executives their job. Africa’s largest wireless carrier by sales continues to battle the $10. 134 billion allegation, which is a combination of $2 billion unpaid tax arrears and $8.134 billion alleged funds repatriation out of the country between 2007 and 2015, which the Central Bank of Nigeria (CBN) has asked it to refund to government coffers.
Chief Innovation Officer at MTN Group, Herman Singh, is expected to leave soon and will move on to start his own tech venture, according to close sources who asked not to be mentioned as the information hasn’t been made public. The exit will come as the Chief Technology Officer, Babak Fouladi, prepares to join Dutch telecommunications firm, KPN NV, in a similar role next week.
MTN confirmed Fouladi’s departure, which was announced by Rotterdam-based KPN earlier this month. But Singh has declined to comment.
According to Bloomberg, the executives are leaving after a three-year period of considerable turmoil at MTN. The $5.2 billion fine in Nigeria in 2015 embroiled MTN in 10 months of negotiations and prompted a management overhaul. Earlier this year, authorities in Nigeria announced another round of multi-billion-dollar demands.
The stock has halved over the period, valuing the carrier at 169 billion rands ($12.2 billion). That’s even as demand for data services in Africa booms and MTN expands in fast-growing services such as mobile money. The company agreed to a partnership with Orange SA last week to ease payments across the continent, Bloomberg said yesterday.
The shares of MTN Group declined a further 2 per cent yesterday to 88 rands as of 1.13 p.m. in Johannesburg, which is the steepest fall in a week.
MTN Chief Executive Officer, Rob Shuter, was hired from Vodafone Group Plc two years ago in the wake of the first Nigeria penalty, which was eventually settled for about $1 billion. Fouladi was lured from the same company later that year. Singh, formerly with MTN’s crosstown rival Vodacom Group Limited, was appointed in 2015.
Another high-ranking executive, Stephen Van Coller, left MTN at the end of August to take the helm of technology firm EOH Holdings Limited. Originally hired as head of mergers and acquisitions, the former investment banker was moved to run digital services before quitting less than two years into his tenure.
AfDB to create 25m jobs for youths, says Adesina
The “Jobs for Youth in Africa” programme launched by the African Development Bank (AfDB) could create 25 million jobs over a 10-year period, its President, Dr Akinwumi Adesina, has said.
He said he does not believe that the future of Africa’s youths lies in Europe. Neither does it lie at the bottom of the Mediterranean Sea, where many of them have been drowning in attempts to migrate to Europe.
Rather, Adesina said, the future of Africa’s youths is in Africa helping to grow its economy and employment opportunities, hence AfDB launched the programme.
Speaking at a conference on “Africa, Challenges and Opportunities: Italy and the African Development Bank,” in Rome, Italy, Adesina said the bank launched also the “Affirmative Finance Action for Women in Africa (AFAWA)” to encourage banks and financial institutions in Africa to lend to female entrepreneurs and businesses run by women.
Adesina in a statement accessed by The Nation at the end of the conference pointed out that it was now “critical to change the lenses with which we look at Africa, from development aid to profitable investment.”
He said the evidence for this came from the tremendous success of the bank’s new mould-breaking initiative, the Africa Investment Forum, an event dedicated to investment transactions, which took place last month in Johannesburg, South Africa.
The AfDB president said at the Forum that investment interests were secured in deals worth $38.7 billion in three days of transaction-dominated meetings among investors, the private sector and African countries.
He expressed confidence that with a growing middle class and rapid urbanisation, consumer demand from a burgeoning middle class would turn the continent into a prime collective investment opportunity that could not be ignored.
“This is positive proof of an Africa in the process of full transformation. Africa is the new international investment frontier,” Adesina said.
He noted that with $11.6 billion, Italy was the largest European investor on the continent in 2017 and the third largest after China and the United Arab Emirates.
At the conference, the Italian Minister of Finance and Economy Giovanni Tria commended the AfDB for its role in fostering a favourable investment environment and addressing Africa’s development challenges.
While pointing out that “Africa is a continent of great change and opportunities,” Tria said the continent is home to five of the world’s fastest-growing economies.
He, however, said only four African countries out of 54 would record a negative growth in the year, compared to eight in previous years.
According to Tria, the narrative about Africa was wrong. He said, for instance, that Africa today has five distinctive advantages, including a huge land mass of 30 million square kilometres and huge resources.
He listed others to include a fast-growing population, fewer conflicts and major developments in education, and an economy that has consistently expanded over the last 15 years, even though it still only accounts for three per cent of global Gross Domestic Product (GDP).
“There is clear evidence of sustained demand growth across the continent. Consumer spending will reach $2.5 trillion by 2030, while business-to-business investments will reach over $3.5 trillion in the same period,” Tria said.
NNPC clarifies issues on NLNG withdrawal
The Nigerian National Petroleum Corporation (NNPC) has shed light on the probe of alleged illegal withdrawal from the Nigerian Liquefied Natural Gas (NLNG) Dividend Account by the Senate, clarifying that there was nothing illegitimate about it.
In a statement, the NNPC Group General Manager, Group Public Affairs, Mr Ndu Ughamadu, said the clarification was made by the corporation’s Chief Financial Officer (CFO), Mr Isiaka Abdulrazaq, at an interactive session with the media over the weekend in Lagos.
The release stated that in a detailed presentation, the CFO clarified that the Senate probe was not about missing money as was being insinuated in some quarters, but rather an investigation into whether NNPC acted legally in withdrawing the sum of $1.05bn from the NLNG Dividend Account to support fuel importation.
According to the release, while granting the statutory right of the legislators to carry out oversight functions, NNPC CFO said that relevant extant laws such as the Appropriation Act 2018 define revenue from NNPC as net of cost, indicating that NNPC has the right to defray the cost of its operations from earnings.
He also cited the NLNG Act which explicitly provides that NNPC could defray its cost from the dividends, as one of the legal grounds relied upon for the expenditure without recourse to appropriation by the National Assembly.
Expatiating further on the matter, Mr Abdulrazaq, according to the release, cited the case instituted by some state governments in 1999 seeking the interpretation of revenue on account of their contention that all accruals from oil and gas operations amount to revenue and should be swept into the Federation Account.
The ruling on that case by the Supreme Court in 2002, according to him, was in tandem with NNPC’s position that revenue is accruals net of cost.
“We have provided the legal authority on which we rely to use funds from the NLNG Dividend Account to the Senate. We believe they will reason with us. But if need be, we will seek legal opinion on it”, the CFO stated.
On the general impression that NNPC and indeed the entire Oil and Gas Industry is opaque, Mr Abdulrazaq contended that in the light of efforts made by the Management of the NNPC since the inception of the President Muhammadu Buhari administration to entrench a culture of transparency, nothing could be further from the truth.
“NNPC is very open and transparent. We publish our NNPC Monthly Financial and Operations reports in the media. No one does monthly reporting, not even the international oil companies or the publicly quoted companies. The best they do is quarterly reports. But we do monthly reports of revenue (profit and loss for the entire corporation, including the subsidiaries). We do operations report on how much oil and gas was produced, sold and the monetary value; how much products the refineries processed and how much was imported and sold by PPMC. We do all these to defuse the perception of opacity. Yet some people still say we are opaque, and I think that is not fair”, he argued.
Abdulrazak disclosed that as part of the stewardship accounting designed to make NNPC’s operations transparent to the public, the inherited six-year unaudited accounts of the corporation have been audited up to date, stressing that the account for 2017 has been fully audited, approved and forwarded to relevant authorities.
On fuel supply and efforts to ensure zero-scarcity throughout the end of year festivities and beyond, the CFO disclosed that NNPC has 2.6 billion litres of premium motor spirit (petrol) in offshore and onshore storage that could last for 52 days at 50 million litres per day consumption.
Also speaking at the event, the Chief Operating Officer, Upstream, Mallam Bello Rabiu, said the major focus of the Upstream Autonomous Business Unit of the NNPC was to drive down the cost of crude oil production and link the Oil and Gas Industry with the economy.
According to him, bringing down the cost of production would lead to cheaper energy cost which would, in turn, boost industrial and economic growth.
He said security and funding that used to be the bane of Upstream operations have been largely taken care of by the corporation through practical engagement with stakeholders in the Niger Delta region and the cash-call exit programme.
The COO said that as part of efforts to drive down cost, the NNPC was looking at extending the Escravos-Warri crude oil evacuation pipeline surveillance contract model to downstream pipelines to guarantee efficient crude supply to the refineries post-rehabilitation.
“Before now, it was not possible to get crude to Warri and Kaduna refineries. But with the kind of security contract in place for the Warri-Escravos Pipeline, we now have 99% crude oil recovery rate. The balance is paid for by the contractor. That is why we have replicated that model for the Trans-Forcados Pipeline to guarantee security”, Mallam Rabiu explained
CBN unveils new loan policy focused on youths
The Central Bank of Nigeria (CBN) and the Bankers’ Committee have agreed to set up a committee headed by Chief Executive Officers (CEOs) of commercial banks to create a strategy that will stimulate lending in the domestic economy.
CBN Governor Godwin Emefiele broke the news yesterday at the end of the 10th Annual Bankers’ Committee retreat in Lagos.
The committee is to ensure that lenders deploy key intervention funds, including the N210 billion Small and Medium Enterprises (SMEs) fund, N60 billion SMEs fund from five per cent annual contribution from banks’ profits, N500 billion Export Stimulation Fund, among others, to promote credit access.
Emefiele said the move was to find ways to improve access to credit by Nigerians, especially the youths.
The CBN boss also said that where the need arises, the youths may be asked to deposit their National Youth Service Corps (NYSC) discharge certificates, degree certificates with the banks to enable them to have access to the loans.
He said: “We need to create a strategy that makes it easy for businesses to access credit. That will also make it easy for reporters to earn foreign exchange and that is why we will be setting up the committee headed by bank CEOs.”
According to him, the CBN and the Bankers’ Committee have been working closely to ensure that youths, who are doing well in the entertainment industry, information technology and software development, get access to credit.
He said the planned take-off of the National Microfinance Bank is meant to help in the disbursement of the intervention funds to borrowers.
“The National Microfinance Bank is expected to make it easier for borrowers to access loans. We want to create independent challenges from where the funds will go out from. The Microfinance banks are doing their best but they are not lending at a single-digit interest rate,” he said.
Continuing, he said the borrowers under the new arrangement will pay back to enable others benefit.
Emefiele went on: “We will make it easy for the youths to access the loans. They will work under the co-operative/ cluster arrangement to ensure they pay back.
“Improving access to finance and addressing infrastructural impediments faced by companies geared towards the export market will confer a string benefit on the economy.
“First, it will enable firms to expand their capacity, as they seek to serve a larger external market. It will also help foster inclusive growth in the economy. As you may know, the oil and gas sector currently accounts for one per cent of total employment in the country.”
He said the drop in Nigeria’s export earnings arose from reliance on crude oil, which exposed the fragility of the country’s domestic economy in 2016.
2019 Election: Minimum wage will determine workers voting pattern – NLC
The general secretary of the Nigerian labor congress, Dr peter Ozo-Eson has declared that the deliberate delay of the increase in minimum wage by the present administration will have ripple effects on the 2019 general elections.
The Nigeria Labor Congress has engaged in a lot of lobbying and meetings proposing to the ministry of labor the possibility of raising the minimum wage to 30,000 to further increase the standard of living of the public servant, but the executive arm has still not passed the bill to the national assembly for implementation.
The Ama Pepple-led Tripartite Committee submitted its recommendation to the president some weeks ago and it has ignored the urgency and importance of the issue considering its slow to action.
“Mr President had promised at the occasion that he will act quickly on it. We are disturbed that up till now he has not sent the bill to the National Assembly.” – Mr Ozo-Eson said.
“Therefore, our advice to workers is that those in government who have shown no inte
rest in the welfare of workers, or have unleashed terror on workers, should be voted out. “We urge our members to use their voting powers to vote such people out,” he said.
The NLC official also noted that this recommendation was supposed to have been implemented two years ago .
Mr Ozo-Eson expressed dissatisfaction about the “i don’t care” attitude practiced and shown by the government in power and he implored all workers who have been victims of the present situation to be careful of how they vote in the coming elections so as not to fall in the same.
He said that though, the political parties have started their campaign, the National Assembly has assured workers that legislators would attend to bills of national importance. He also said that the National Assembly members had specifically promised that they would give accelerated hearing if the bill on the minimum wage reached them. (NAN).
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