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Transparency International, the global
corruption watchdog, wants member nations of the Group of 20 (G20) to
step up their efforts towards sustained financial sector reforms
against the background of growing corruption and negative impact on
economic recovery efforts.

Ahead of the
group’s two-day annual Finance Ministers and Central Bank Governors
meetings, which begins today in Washington D.C., United States of
America, the global anti-corruption body stated that reforms would
entrench ethical corporate governance in the face of growing prevalence
of financial frauds in the financial institutions of most members of
the group.

Good corporate
governance, according to its Chairman, Huguette Labelle, is critical to
sustainable financial institutions, adding that the integration of good
governance and anti-corruption measures are critical to the
sustainability and effectiveness of the reform measures.

“The time to act is
now to entrench good corporate governance culture. It is two years
since the onset of the financial crisis and the critically needed
reforms to protect the general public from fraud must be fully
implemented. The current scandals underline the need for better
oversight and efficient law enforcement,” he said.

Group’s resolutions

Mr. Labelle
recalled the group’s resolution calling on G20 members to ensure that
they implemented the financial regulations outlined at the end of its
meeting in 2008 as the main structural solutions to averting future
economic crises, warning that the complexities in new regulations on
derivative trading, hedge funds, “too big to fail” institutions or
prudential standards should not be a reason for any delay.

Stressing the need
for regulatory agencies to strengthen the transparency of all financial
products marketed to investors, the global body said this would ensure
clear requirements for comprehensive disclosure, and prevent abuses of
off-balance sheet instruments, while individuals and firms would be
sanctioned for fraud.

“Lack of corporate
governance, weak ethics and poor regulation was at the heart of the
financial crisis. This should not be allowed to happen again. Any
corporate communication to investors and to the general public should
be designed to inform them, and not to purposely sell weak products or
publish dressed up quarterly figures.

“If anyone has any
doubt about the urgent need for the G-20 to make integrity a crucial
issue in global financial reform, then they just have to look at
today’s newspaper headlines,” Mr. Labelle said.

World Bank statistics

Available World
Bank statistics, according to Mr. Labelle, indicates that the global
financial meltdown last year directly prevented over 50 million people
in the developing world from escaping abject poverty, adding that the
Finance Ministers and Central Bank Governors should use the occasion of
this week’s meeting to consider a comprehensive analysis of the G20
Action Plan to forestall a repeat of the global economic crisis.

As part of efforts
to entrench corporate governance in the nation’s financial system, the
Board of Directors of the Central Bank of Nigeria (CBN) late last week
rolled out an amendment of prudential guidelines on loan loss
provisioning first issued in 1990, prescribing a set of minimum
requirements for banks and other financial institutions.

The apex bank’s
governor, Sanusi Lamido Sanusi, said the review became necessary
bearing in mind the current dynamics in the industry to provide
measurement for loans, establishment of loan losses allowances, credit
risk disclosure and related matters.

The approved
amendment recognizes ‘Specialized Loans’ and ‘Other Loans’ as the two
provisioning categories, with the former using time-based approach,
while the current prudential guidelines for specific loans loss
provisions shall continue to be applied to other loans type.

According to Mr.
Sanusi, the time-based approach establishes longer time lines for
measuring asset quality, based on the gestational periods for projects
in sectors of the economy such as small and medium enterprises (SMEs),
agriculture and infrastructure.

The ‘Specialized
Loans’ comprise mortgage loans, margin loans, object finance, project
finance, real estate loans, SME loans and others, including corporate,
commercial and retail loans, advances, overdrafts, commercial papers,
bankers acceptances, bills discounted, leases, guarantees and other
contingencies connected with a bank’s credit risks.

The use of the .ng domain for online
business transactions with other countries is said to be affecting
business negatively, due to the high level of cyber crimes in the
country.

Bunmi
Akindele, a business woman, said, “Considering the way those in Europe,
United States, and Asia, among others, see Nigerians as a fraudulent
people to do online business with, using the .ng domain for your
business will certainly affect your business with organisations abroad.

“I
cannot register my company name with the .ng domain because it will
ruin my business as I cannot order for goods with that domain’s name
because it exposes my identity. The country has been portrayed in a bad
image because of the yahoo yahoo deals (Internet fraud) in Nigeria,”
added Ms. Akindele.

IP address, not .ng

However,
in a telephone interview with NEXT, Lanre Ayaji, the president of
Nigerian Internet Group (NIG) explained that the .ng domain name is not
the cause of failed online transactions, but the Internet Protocol (IP)
addresses from Nigeria.

“I
don’t really think that is the major reason why people are not using
it. I have been using the .ng domain for over 10 years now, and I have
not had any serious problem with it. People abroad who are scared of
doing business with Nigerians online are not using the domain name to
discriminate; they usually use the IP address to discriminate. The
discrimination is not done manually; it is done by the application
system that is operated abroad, and it is on that system that they list
the IP address which they don’t want to accept.

“The
moment an IP address is identified to be that of a Nigerian, that
person is barred from doing business online with that organisation. So,
it is not the domain name that causes the problem. Anybody that has a
perception that if he or she uses .ng, they will have problem doing
business online may have to re-examine that view. I think that is just
a mere perception, and not the reality,” said Mr. Ajayi.

Blame it on cybercrime

However,
operators agree that the high incidence of cybercrime is a major issue
that has also affected online transactions with Nigerians.

Mr.
Ajayi said, “I will encourage people to take up the .ng domain as it
may not affect their online transactions. But that is not to say that
the incidence of cybercrimes have not affected online transactions from
Nigeria.”

The
absence of policy to tackle cyber crime is a major problem. Jimson
Olufuye, the president of Information Technology Association of Nigeria
(ITAN), called on the federal government and regulators to put in place
appropriate legislations on cyber security to mitigate crimes. Mr.
Olufuye urged government to key into the toolkit recently launched by
the International Telecommunication Union (ITU) to reduce cybercrime
globally.

Benefits of .ng domain

Ugo
Akiri, an official of the Nigeria Internet Registrations Association
(NIRA), said the benefit of using the .ng domain are enormous,
particularly with regard to cleaning up the country’s image.

“The
.ng domain is a good instrument that will help to clean up Nigeria’s
image in terms of the negative use of the Internet these past years.
This will also help us to generate enough resources to invest in the
new generic top-level domain name (gTLDs) before foreigners overrun us
by taking up viable Nigerian geographical names for their new gTLDs.

“Access
to information is very important, as the world is developing daily by
new technologies and better ways of doing things. So, this would impact
on our access to information generally, and on education specifically,
as more Nigerian content will be available on the web,” she said.

Mr.
Ajayi also added that if Nigerians can register their businesses with
the .ng domain, it will help to improve the country’s economy without
the attendant capital flight.

“For
Nigerians, it saves foreign exchange. If you are not registered with
.ng, you would be registering with another gTLD and would be paying
dollar to the other country, but when you register with .ng, you are
paying naira to the registrar and you are saving money for the country,
instead for another country,” he said.

The
South African embassy has promised to improve on the challenges faced
by Nigerian business personnel in getting visas to that country, in
order to enhance the trade relations with Nigeria.

Thandi Mgxwati, Political Counsellor/Head of Lagos
Mission, South Africa High Commission, speaking on ‘Nigeria-South
Africa Bilateral Relations – Successes and Challenges’, said efforts
are currently being made to make visa applications and processing
easier for Nigerians wishing to travel to that country.

The South African envoy, who spoke at a breakfast
meeting organised by the Nigerian-South African Chamber of Commerce on
Wednesday in Lagos, said this is one of the ways to fully explore the
investment and trade opportunities available to both countries through
their bilateral relationship.

The relationship between Nigeria and South Africa
is believed to be skewed in favour of the latter, as there are more
investments and trading activities by South Africa in Nigeria, than the
other way round.

“South Africa is looking forward to working with
Nigerian businesses to further open up trade and investment
opportunities between the two countries, and we will like to see more
partnerships and more Nigerian businesses coming into South Africa. We
are trying to respond to the imbalance business arrangement by taking
advantage of these opportunities to create a better working condition
for all parties,” she said.

Ms. Mgxweti argued that Nigeria can gain a lot in
business partnership with South Africa in terms of industries,
agriculture, among others.

Investment opportunities

Trade relations between both countries since the
launch of the South Africa- Nigeria Bi-National Commission 10 years
ago, leapt from $16.5-million in 1999, to $2.1-billion in 2008.

Although Ms Mgxweti said she did not have current
statistics on the volume of trade between Nigeria and South Africa at
the time of the briefing, she however, hoped it is good, adding that
there is still a lot of business potentials in the two countries
waiting to be explored.

Visa problems

Most of the participants who spoke at the meeting
called for a quick resolution of the visa problems encountered by
Nigerians at the South African embassy, as the situation is affecting
Nigerians intending to do business with that country.

To this, Ms Mgxweti said, “We are currently
working on a short term solution. This we intend doing by introducing
systems to perfect the turnaround time for visa applications. This will
be used to provide more information to people, as we have realised that
the lack of information on the visa requirements by the embassy has
been a deterring factor to issuing visas.

“We intend creating a website which will enable
people to read more, and this will concurrently serve as a platform to
addressing issues of business barriers. We also want to use this medium
to encourage people who intend going for the World Cup to apply on time
for their visas and not leave it to the last minute, as this will help
save all the hiccups and unnecessary stress,” she added.

Nicholas Coleman, the new Commercial Counsellor at
the South Africa High Commission, said his mission to Nigeria is to
enhance trading opportunities between both countries, by providing
relevant information to potential investors and business personnel
wanting to explore the South African economy.

Alubani Sebanda, Head, South Africa Corporate
office, Stanbic IBTC Bank Plc, sponsors of the breakfast meeting,
recalled that the bank started with five branch offices in Nigeria, and
has been tapping from the vast Nigerian economy, and believes they can
still do more.

“We are an international repute bank with no
crisis record during the bank auditing and repositioning carried out by
the Central Bank of Nigeria, in August last year. We are still waxing
stronger and are encouraging a growing partnership and business
investments between both countries, and we are willing to extend our
private equity external bank by looking into enterprises and help them
gather information about what is happening in South Africa and what to
invest in,” he said.

Thobi Duma, Country Manager, South Africa Airways,
used the opportunity to encourage Nigerians to book their flights to
attend the World Cup, as this will open up more business opportunities
for them, while also providing them a means of relaxation and tourism.

The newly appointed group managing director of the Nigerian
National Petroleum Corporation (NNPC), Shehu Ladan, has joined his predecessor
to state that NNPC is fully in support of the planned deregulation of the
downstream sector of the petroleum industry by the federal government.

While presenting a paper, titled, “Downstream Petroleum Sector:
The Imperatives of Deregulation,” before a coalition of legislators at the
National Assembly in Abuja, on Wednesday, Mr. Ladan, said the speedy implementation
of the deregulation policy would go a long way in encouraging inflow of private
sector and international investment in the downstream sector.

“Without mincing words, let me join my predecessor to state that
NNPC is 100 per cent in support of deregulation, not just because it will
support our business, but because this is the only way that majority of
Nigerians will derive fair deal from the abundant petroleum resources in the
country. With deregulation, consumers will enjoy fair product prices and
operators will be in a position to recover full cost and reasonable margins on
their operations,” he said.

The NNPC boss argued that implementation of the policy would
give rise to efficiency in product usage, product availability and effective
competition among investors, hence putting an end to the “NNPC monopoly.”

Investors’ fear

Mr. Ladan said it is only when a deregulated regime is put in
place that the private refineries that have been licensed can really take off,
noting that investors who have been given licenses to build refineries are
scared of venturing into the multimillion naira project because of the
regulated regime in Nigeria.

“Clearly there is the need to move away from the current ad hoc
pricing to an automatic price adjustment mechanism that is truly
de-politicised. In the transition to full market liberalisation, the regulator
has the responsibility to monitor and check anti-competitive behaviour such as
price gouging and predatory pricing,” he explained.

The Corporation head further explained that complimentary
measures have been included in the 2009 supplementary and 2010 budgets to
cushion the likely effects of the policy, adding that the measures included the
provision of intra-city rail transportation in six major cities: Lagos, Kano,
Port-Harcourt, Jos, Enugu and Maiduguri, as pilot projects. He also said plans
were underway by the federal government to commit N373 billion to massive road
rehabilitation and new construction interventions across the entire country in
addition to the procurement of 25 railway locomotives.

“Part of the complementary measures to cushion the effect of
deregulation on the low income and the poor household include the provision of
low income housing scheme and civil servants mortgage scheme and N10 billion
revolving mass transit scheme in 2009 supplementary budget,” Mr. Ladan said.

The Chairman of the Coalition, Bassey Etim Bassey, said the
corporation head was invited to outline the merits and demerits of deregulation
to members of the National Assembly, to enable them to take an informed
position about the policy.

Stephen Covey, a motivational speaker, has said that in order
for organisations to grow effectively they need to first discover their “road
map.”

Speaking at an event with business representatives in Nigeria on
Wednesday in Lagos, organised by Zain Nigeria and tagged ‘An Evening with Dr.
Stephen Covey’, Mr. Covey said only an accurate road map will lead to great
improvement in business.

Maps and principles

“In business, there is need to practice positive mental attitude
but attitude and action is insufficient, the key is to have an accurate map,”
he said. “Every great breakthrough is a great win. If you want to make minor
involvement, work on behaviour and attitude; if you want to make quantum
involvement work on paradigms. A paradigm is like a model for assumption of a
map.

“To have an accurate map is extremely important and that can be
embodied in your mission statement. Secondly, the power of principles is very
in important in organisations. A true principle is always the same. So, the
idea is that you build your life and organisation on the correct paradigm or
map and the principles that are universal and timeless.”

Mr. Covey explained that principles are important in any
organisation or cultural environment but should not be misunderstood as values.

“Principles are not values; the key is to value principles. The
different is that values are social norms, personal, emotion and subjective
while principles are natural laws, impersonal, objective and factual,” he said.
“These principles are applied in any country and in any culture. The more you
value principles and live by principles the higher the trust become. The higher
the trust is, the lower the cost is and speeds is exalted enormously. When you
have lower trust, speed really slows down and cost goes up. So that is why it
is important to have a correct map or paradigm and live by principles. The
essence of what I teach over 140 countries around the world is to teach people
about research, strategic planning and leadership.”

Growth and impact

However, Mr. Covey said that in order for organisations to grow,
they must seek customers who can also aid in promoting their products and such
a relationship must be built on principles.

“Relationship with organisations and customers/clients must be
built on principles so that on the net promotion scores you get 9-10 scores on
the scale; people will be committed, loyal and would stay with you,” he said.
“After decade of research only one question correlative to an organisation’s
profitable growth (is relevant): how likely is it that a customer could
recommend this product to others? If they give you 9-10s, they become
promoters; anything less than eight are detractors, they would find fault with
your products and service and would not recommend you to others.”

Speaking with NEXT at the event, business participants agreed
that motivational lectures can help change and develop organisation and
governance in Nigeria.

Tunde Ayeye, a business consultant, said “I think it goes beyond
organisation effectiveness; it helps you in your life as an individual and I
think it very useful.”

Mr. Ayeye added that despite the problems in Nigeria, especially
corruption, there is a basic need to adopt principles in order to transform
society. “The truth of the matter is corruption is global and its pervasive.
You are a product of your choices, and you make choice based on principles. So,
I think other business and governance need to adopt those principles if we want
to transform our businesses and our society,” he said.

However, Ayo Akintujoye, a marketing executive at 2G Consulting
firm, said that the virtues recommended by the speaker are good, but the
cultural reality of the country has not fully allowed for change to take place.
“I have been to events like this both international and local and you discover
that there is a vacuum from what you learn and the cultural reality of
Nigeria,” he said.