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Category Archives: Africa business news

Federal Government targets N3.6 trillion investments in oil, gas infrastructure – THE GUARDIAN

“The Institute has a lot of role to play in the gas policy in terms of training and development of local human capital. This Policy would lead to the harnessing of the country’s vast gas resources and the stopping of gas flaring in Nigeria”, he said.
Kachikwu stated that the Petroleum Industry Bill (PIB) is being considered in phases by the National Assembly.
“The Bill itself covers everything from the overhaul of NNPC to taxes on upstream projects, to regulatory framework of the oil and gas sector. I want to state firmly that PTI would be properly captured in the Bill”, he added.
He emphasized the need for local content development in the oil and gas sector, adding that “PTI tends to collaborate with Nigerian Petroleum Development Company (NPDC), which has been mandated to construct a model modular refinery using local materials and technology.
“This refinery would be used for experiential training and for teaching purposes. The Institute would once again be involved in the training and re-training of personnel of NNPC thereby cutting off capital flight through local training in conformity with the Change Mantra of this administration.”
In his welcome address, the Principal/Chief Executive, PTI, Prof. Sunny Iyuke, disclosed that 48 students graduated with distinction, and 347 students graduated with upper credit.
He said that the institute would be collaborating with several universities within and outside the country in the Postgraduate Diploma and Masters of Science Programme in engineering.
He added that the institute and Wits University in South Africa were also finalising arrangements to commence Post Graduate Diploma and Masters in engineering.
Iyuke noted that this collaboration, no doubt, would break the HND ceiling for our teeming graduates and further boost our human capacity development.
He appeal to the oil and gas industry operators to take full advantage of the graduation ceremony to recruit the best who have been trained and are market ready.
He also made an appeal to Petroleum Technology Development Fund (PTDF) to complete the hostels, new academic building, renovation of the printing press and the installation of training equipment, which are on ground in various departments.
“I wish to appeal to Niger Delta Development Commission (NDDC) to furnish the hostel donated to PTI and hand it over. It is my prayer that these challenges will be met before the commencement of the 2017/2018 Academic session,” he added.

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Shipping companies introduce new charges on imports to Nigeria – NIGERIAN TRIBUNE

Speaking on the development, the Managing Director and Chief Executive Officer, Mickey Excellency Nigeria Limited, Alhaji Abdulazeez Babatunde, accused the Nigerian Shippers Council of negligence of its statutory duties, saying that as the regulator of port services, it ought to be monitoring the activities of the shipping companies.
Babatunde, a freight forwarder and stalwart of the Association of Nigerian Licensed Customs Agents (ANLCA), said importers were been forced to pay the arbitrary charges without intervention by the government.
“In the past three weeks, shipping lines and agencies have been imposing arbitrary and illegal charges on importers, because of negligence and lack of monitoring by the NSC.
“The council is an agency of the government that gets heavy financial subvention to protect the interest of importers and exporters, but right under the council’s watch, the shipping companies are arbitrarily and imperiously imposing illegal charges on importers, without a word from the council,” he said.
Efforts to get the Director, Special Duties of the Shippers Council, Ignatius Nweke proved abortive as text messages and calls put through to his mobile phone were not responded to as at the time of filling in this report.
It will be recalled that foreign shipping companies, earlier in the year, had issued a circular, dated October 28, 2016, notifying port users that they will start collecting N38,000 charges on all containers at the ports.
The shipping companies labelled the charges as government and port taxes, and started implementation in December, 2016.
This recent charge, Port Additional Destination, is coming on the heels of the government and port taxes earlier added to shipping bills on Nigeria bound imports.

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FG gets $29 billion from SPDC as NDDC gulps $1.8b in four years – THE GUARDIAN

The company’s General Manager, External Relations, Igo Weli, made this known in Yenagoa, Bayelsa State, at the 2017 Swamp West Hub Integrated Stakeholders Engagement Forum for Tarakiri/Egbema/Oporoma Community Leadership.

Weli, represented by the Assets Manager, Swamp West Hub, SPDC, Mesh Maichibi, restated, the economic contribution from SPDC JV partners to the Nigerian government between 2012 and 2016 was $29 billion.

“We also know that we have NDDC and the NDDC was set up to develop basically the Niger Delta and the Federal Government has come up with a law where all the oil companies must pay certain amount to the NDDC for them to use in development.

“As a company, as a joint venture partner, we have contributed $1.8bn into NDDC’s fund within the period. And the expectation is that this fund will be used for the development of our communities’ socio-development, roads, bridges and all of that. That is part of the joint venture development that we have,” he said.

Weli said such disturbing situations could hamper development of the region, urging the people to cooperate with oil companies in order to achieve maximum benefits.

“We have had situations where our facilities were shut down. We have had situations where our assets have been blocked, not by outsiders but by those us from this region.

“The money that comes into our state and local governments is from production of oil and gas. We want all of us to help each other. When there is money in the state, there will be investment and development.

“If we allow these things such as oil bunkering, theft and vandalism to happen, the resources that accrue to the state will also go down and it will affect every sector of the state and local economy. That is why we are here. We want to talk. I want to show you some statistics of what we as a company have done towards the development of the region.’’

At the second second forum titled ‘EA Hub Integrated Stakeholders Engagement Forum for Iduwini/Mien/Kou/Bassan-West Cluster community, Weli said the essence of the forum was to get feedback from the communities.

Represented by the Shell’s Stakeholders Relations Manager, Dr. Alice Ajeh, he said: “The essence is to have continuous conversation with our communities, critical stakeholders for the feedback they have been giving us over time.

“They want us to have a continuous dialogue and this is one of the ways we feel we can bring all of them together to really think about the future of the Niger Delta, not just individual community issues, but collective issues of our future in the region.

“This is just for us to think about the future and therefore, the decisions they will arrive will help us to know the basis of working with them. When they understand what it is they will like the future to be like, whatever programme we are putting in place, they will ensure that they work so that the future will be better for us.’’

Also speaking, the EA Assets Manager, Dele Adigun, said that having engagement with their host communities had always been high on Shell’s agenda.

Adigun said there was the need to work collaboratively with the host communities to ensure sustainable peace and development in the region.

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‘Nigerian loses over $18b annually to foreign trips’ – THE NATION

The first time I traveled to Israel I found out that most of the Jews didn’t know Jesus, they know more of Moses. And honestly speaking if we know what we have, we don’t need to go out because we have a lot of rich culture and I think the Minister of Tourism shouldn’t be looking at Culture to be the pivot instead of Tourism because I have never seen anywhere in the world where you are pushing Culture ahead of Tourism.
Tourism is the real umbrella, it is the father of all, where you have a tourism economy, the economy thrives. Culture and tourism have a mutually beneficial relationship which can strengthen the attractiveness and competitiveness of places, regions and countries. Culture is an increasingly important element of the tourism product as it creates distinctiveness in a crowded global marketplace. At the same time, tourism provides an important means of enhancing culture and creating income which can support and strengthen cultural heritage, cultural production and creativity.
Culture and tourism are linked because of their obvious synergies and their growth potential. Cultural tourism is one of the largest and fastest growing global tourism markets and the cultural and creative industries are increasingly being used to promote destinations. The increasing use of culture and creativity to market destinations is also adding to the pressure of differentiating regional identities and images, and a growing range of cultural elements are being employed to brand and market regions. Partnership is essential. The complexity of both the tourism and cultural sectors implies that platforms must be created to support collaboration, and mechanisms must be found to ensure that these two sectors can communicate effectively. Local communities are beginning to come together to develop cultural products for tourism rather than competing directly with one another. New policies are likely to feature new structures and projects involving public-private partnership and bringing together a wider range of stakeholders to use culture not only to make destinations attractive for visitors, but also to promote regions as destinations to live,work and invest in.
The most important aspect in linking tourism and culture is to develop an effective partnership between stakeholders in the two sectors. In many cases the problem is that there are different approaches: the profit motive vs. non-profit, markets vs. public, etc. The role of any platform trying to bring these two sectors together must be to identify their common interests and to act as a mediator between them. It is clear that there is a common interest in the attraction of people to the regions in which they are based, but very often differences approach get in the way.
In the tourism sector it is normal to speak about visitors, conceived of as customers or clients, whereas the cultural sector is more concerned with residents, usually seen as audiences or citizens. These differences can be overcome when it is made clear that tourists are also part of the cultural audience. As well as partnership between tourism and culture, it is also important to build other forms of partnership, for example with other regions, between the public and private sectors and between a region and its citizens. Links between regions can extend the cultural opportunities available to tourists and help to support new and innovative product offers.
Working with the private sector is essential for attracting investment and continuing to improve the quality of both the cultural and tourism offer. Convincing residents of the benefits of tourism development is increasingly crucial as they come to form the core of the cultural and creative tourism experience.
 
Tourism as alternative to oil
I think one of the reasons we are not thriving in tourism sector is because we are not having major players and stakeholders who are at the helm of affairs, we are having people who are been scold to be ministers, and when you are scold, you still don’t understand it because your investment is not there and you have people who have billions and billions of dollars who are stakeholders in this industry and someone who is just been put there maybe because of political affiliation is coming there to be scold, and you see them coming up with different summits, bring us together to come and tell them about what tourism is all about and hijack all our ideas and they will think they are ministers no they are wrong. Tourism is the pivot, we need to go back to that and we need to understand that inside tourism, we have what we call the minds concept which is meeting incentive, conference and exhibition because these are the bedrocks, the foundation of tourism and that is why the culture, the leisure, the domestic tourism like pilgrimage, estate, fashion and Nollywood all comes as a connection together in making what we call the revenue of tourism, that I believe is the alternative revenue for Nigeria.
Best practice
For instance, trips abroad cost Nigeria over $18.6billion annually. Now let’s take a look at two major ones, religious tourism. In Ogun state axis of Ota we have Shiloh that comes up every November, that is what we call destination tourism 80% of the people that come to Shiloh are not from Ota, they are from Lagos, Lekki, Ikoyi, Ikorodu and some other places outside the country. So they provide buses, and the question I ask is these buses are they moving towards the community of paying taxes? I’m a Christian, the bible says give what belongs to Caesar to Caesar r and what belongs to God to God. But are they doing the right thing? So if the government can work with theses religious bodies, I know this might offend some people but sincerely speaking we are Christians let’s be honest with ourselves, because the honesty and clarity of the game and the way we play religion is painful and is actually to the detriment of the nation. Religious tourism is what Israel feeds on and they make over $1billion every year. So it’s about time we look at Shiloh and RCCG and Mountain of Fire how many government stands are in these places, none. How do people know the country without its stands in those places, they will not know you, be proud to show yourself as a Nigerian.

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Nigerian govt takes ownership of funds held in bank accounts not linked to BVNs – PREMIUM TIMES

 
The remaining three are: Unity, Bank Wema Bank and Zenith Bank.
The court also ordered all of them to disclose any investments made with funds and to withhold authorisation for any outward inflow of funds from the accounts. All the details are to be submitted to Nigeria Inter-Bank Settlement System, NIBSS, and the CBN for authentication.
The banks were also directed to publish all bank accounts not linked to BVN in national newspapers with a 14-day notice for individuals with interest in such accounts to come forward and justify why their funds should not be forfeited to the Nigerian government.
Mr. Dimgba also ordered the CBN, which was joined as 20th respondent alongside the 19 DMBs, to appoint an official who will examine all the details submitted to the apex bank for compliance.
The government argued the matter under Section 3 of the Money Laundering Act, 2011.
The section said banks must “ensure that documents, data or information collected under the customer due diligence process is kept up-to-date and relevant by undertaking reviews of existing records, particularly for higher risk categories of customers or business relationships.”
The BVN is a unique identification number that can be verified and used to transact business across all the banking platforms in Nigeria.
The CBN imposed the policy to capture customers’ data for financial transactions and check fraud in the banking system.
Registration for BVNs commenced on February 14, 2014, across the country. The CBN said over 20.8 million customers enrolled 40 million bank accounts before the October 31, 2015, final deadline for customers residing within the country.
The CBN extended the deadline for Nigerians in the diaspora to December 2016 to sign up for the BVN system. But hundreds of thousands home and abroad are still believed to be left behind.
 

 
 
“Illogical, hasty‘
A financial analyst who spoke with PREMIUM TIMES about the court order rebuked the Nigerian government for attempting to shore up its revenues by forcibly seizing funds owned by private individuals.
“There’s no basis for this desperate move by the federal government because customers who owned the funds met the required criteria at the time they set up their bank accounts,” said Ugodre Obi-Chukwu, a Lagos-based financial analyst. “This is an attempt to use federal might to coerce banks into submitting funds that belong to customers for its own use.”
The Nigerian government had fallen on hard times since 2014 when dwindling price of crude oil began to take its toll on the country’s revenues.
The Buhari administration, which assumed office in May 2015, has made concerted pushes to source funding to finance a bloated federal civil service and new capital projects, including borrowing from local and international markets.
The government also said it would rely on recovered loot to finance its budget this year.
While Mr. Obi-Chukwu recognised financial challenges confronting the administration, he maintained that no policy must be implemented by fiat in a democratic system.
“The Money Laundering Act they used to sway the judge is clearly not sufficient to confiscate personal funds,” he said. “There’s no law that allows for this specific action taken by the government as it stands.”
He advised the federal government to allow people to withdraw their funds from the bank accounts if they’re not willing to link them to BVN, especially since they weren’t identified as proceeds of crime.
Lawyers weigh in
Two legal practitioners interviewed by PREMIUM TIMES Saturday held slightly disparate views on the matter.
Liborous Oshoma, who runs a law firm in Lagos, condemned the order as “far-reaching and despotic” in nature.
“You can’t just drag banks to court and ask them to submit all funds in bank accounts which they’re holding in trust for private individuals,” Mr. Oshoma said.
 

 
 
“The funds are mostly personal deposits. In law, orders are supposed to be specific, directed and enforceable against individuals or institutions,” Mr. Oshoma said. “But we cannot see how the government assumed it could sue banks to enforce orders against individuals who have not been accused of any criminal offences.”
Mr. Oshoma said the Buhari administration did not fathom the possibilities of Nigerians who are serving long prison sentences abroad and may not be in tune with developments in the outside world.
“The despotic tendency of wanting to take what does not belong to them made them forget that people might be in conditions where they cannot come and claim their funds for the next 20 years or more,” Mr. Oshoma said.
“If the government is really desperate to get people’s money because they cannot be found, it should find sensible means of going about it and not resort to steps that are not in consonance with democracy,” he added.
Although he questioned the legal premise of the federal government’s attempt to seize the funds, Inibehe Effiong, also a Lagos-based lawyer, told PREMIUM TIMES the overarching goal of the move was understandable.
“The BVN is a policy of the federal government which is aimed at mitigating financial crimes in the system,” Mr. Effiong said. “The policy was backed by certain financial regulations which make it appropriate for the government to ask for a general freezing order of accounts whose owners cannot be ascertained.”
“But what I cannot understand is the legal structure upon which the policy is standing,” Mr. Effiong said.
Mr. Effiong said authorities should have sought details of bank accounts first, then examine them individually and isolate ones with suspicious traits.
“The government should have stopped at requesting for details of all the bank accounts. but not go as far as getting a blanket approval to withhold all funds.
“If they all the accounts based on their merits, they can sort out the ones with criminal traces and seek their forfeiture,” Mr. Effiong said.

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An African problem for electric car makers – BUSINESSDAY

An 85 KWh battery used by Tesla requires some 8 kilograms (17.6 pounds) of cobalt. Bloomberg Intelligence predicts that growth in EV sales at currently projected levels will drive up cobalt demand by 9,300 percent by 2040, and the car industry will require about three times the 2016 total mined production that year. Given that cobalt is also an important element in the production of industrial alloys, massive production growth will be required. At current production levels, cobalt reserves are expected to last for 57 years, compared with 400 years for lithium. Surely more reserves will be discovered, but it’s likely that production will remain dependent on one country — the Democratic Republic of the Congo, currently responsible, according to Bloomberg Intelligence, for about 54 percent of mined cobalt and some 49 percent reserves. It’s one of the world’s poorest nations currently run by a president who refused to cede power after his term ran out last year.
A large share of the country’s cobalt exports comes from “artisanal” mines — those dug by locals under the control of various strongmen. Child labor and harsh exploitation are rife, according to an Amnesty International report released last month. Much of the rest is mined by Chinese state companies, with the DRC government using its share of these projects’ profits to pay off loans issued by China. That creates tension: The government wants to extract more profit, and it’s trying to force the Chinese producers to refine more of the cobalt ore inside the country rather than export concentrate to China. In 2008, a supply squeeze driven in part by Congolese export restrictions drove the price of cobalt to its peak; the current price is 41 percent below it. Other companies may follow Tesla in pledging to ethically source their cobalt for new production, helping to eventually develop new sources, but that will take time.
 
In the meantime, this is a scary set of circumstances for the car industry. They’re doing their best to lock in supply. Earlier this year, Volkswagen reportedly benefited from a four-year deal whereby commodities trader and miner Glencore signed up to supply 20,000 metric tons of cobalt to Chinese battery producer Contemporary Amperex Technology. But in September, it made a more direct attempt to ensure its EV plans wouldn’t be thrown off by high cobalt prices or shortages of the metal. Its tender for five-year supplies at a price below the current spot one expired without drawing any interest.

Making electric vehicles profitable is a challenge. The uncertainty of raw materials supplies — an understatement when progress depends on an unstable African country and Chinese state firms — makes it even harder. Technological alternatives that reduce the dependence are necessary, and battery makers are looking at using less cobalt and more nickel in cathodes. Samsung has said it expects cobalt use in batteries to go down eventually to about half of the current level. Meanwhile, recycling can help increase cobalt supply, especially if the current energy-intensive process can be improved. But there’s no technology on the commercial horizon that could completely cut cobalt out without compromising on battery performance.
Perhaps the natural constraints will be useful in toning down the EV exuberance — something both regulators and the industry need to allow more time for research and development. Other solutions, such as hybrid cars with smaller batteries and fuel cell vehicles, don’t deserve to be killed off by a surge in battery-powered vehicle production just yet. For the EV revolution to benefit consumers, battery tech must make a lot of progress both in reducing its reliance on small, capricious raw materials markets and in consumer qualities such as range and charge speed.
By Leonid Bershidsky

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Big Oil Set for Bumper Profits Despite Cheap Crude – WSJ

Baker Hughes, which General Electric Co. bought in July, said its losses narrowed 17% in the third quarter to $122 million, from $147 million in losses in the previous quarter, as it works to merge the oil-field services businesses of the two companies.
Lorenzo Simonelli, CEO of the newly combined company, agreed with his counterpart at Schlumberger, saying he saw a “deceleration” in U.S. drilling activity in the last quarter.
—Bradley Olson contributed to this article.
Write to Christopher M. Matthews at christopher.matthews@wsj.com

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