Nigeria Content Online

Barclays Bank of
Kenya has entered a partnership with telecoms firm Safaricom offering
its mobile phone-based money transfer service M-Pesa to the bank’s
clients, both firms said on Wednesday.

M-Pesa is the main
way of transferring small cash amounts in Kenya, mainly because it does
not require users to have a bank account. Millions of people in east
Africa’s largest economy do not have access to banking services and the
deal is seen as a way of addressing this.

“This partnership is in tandem with our strategy of stretching
M-Pesa’s footprint beyond the regular agent outlet,” said Safaricom
Chief Executive Officer, Michael Joseph.

Ghana’s inflation
eased for the 15th month in a row in September, data showed on
Wednesday, but analysts put much of the latest fall down to seasonal
effects and were cautious on prospects of fresh interest rate cuts.

Annual inflation
fell to 9.38 percent from 9.44 per cent in August, extending a run that
has seen consumer price growth more than halve from its June 2009 level
and confounding market expectations of a slight rise.

But, weeks before
the scheduled start of oil from Ghana’s Jubilee offshore oilfield and
with concerns growing over the West African country’s public finances,
future price pressures were hard to call.

“It is difficult to
forecast inflation for the next month — all depends on how the
government handles the pressures,” government statistician Grace
Bediako said of moves to implement a new public sector wage structure
seen as raising spending.

Eyo Ekpo, a member
of the Presidential Task Force on Power (PTFP), says the high level of
infrastructure decay and wide gap in investment are major impediments
to effective power supply.

Mr Ekpo, Head,
Regulatory and Transactions Monitoring Unit of the task force, said
this on Wednesday in an interview with the News Agency of Nigeria in
Lagos.

He said that the
nation’s power supply had been hindered for years by limited
generation, transmission capacities, obsolete equipment and unreliable
distribution network.

Mr Ekpo said that
over-bloated and inefficient workforce were also obstacles to meeting
the national power demand approximated at between 10,000 and 15,000MW.
He said that the power generation level had even declined while demand
was on the rise.

“This problem has
apparently trickled down to the transmission and distribution arms of
the sector. The manifestation is the perpetual power failure and
shortage being witnessed across the nation. But in all fairness, I
think this is simply unacceptable if we consider the fact that
countries like South Africa, Egypt and Ghana enjoy better generation
capacities,” Mr Ekpo said.

He added that the
lack of investment in power generation, transmission and distribution
were the major factors inhibiting the growth of the sector.

Farmers in Ekiti
State are to access the N2 billion federal government agricultural
intervention loan, Joseph Ogunjobi, Chairman of the local chapter of
All Farmers Association of Nigeria (AFAN), has said.

Mr Ogunjobi on Wednesday said that the state government had concluded arrangements to ensure that farmers accessed the loan.

He said the money
was still with the Central Bank, and attributed the inability of
farmers to access the loan to the “uncooperative attitude” of the
immediate past leadership of AFAN in the state and the government.

He said, however,
that Segun Oni, the state governor, was doing his best to facilitate
the disbursement of the loan to all registered farmers in the state as
soon as possible. Mr Ogunjobi said the association was also working in
conjunction with the government to ensure that only genuine farmers
benefitted from the loan.

He said the governor had directed both the Ministries of Finance and
Agriculture to liaise with the leadership of AFAN to accelerate the
disbursement of the fund.

On Sunday, the
latest incarnation of the Ubuntu Linux distribution was released.
Coming six months after the last edition, some people are beginning to
feel that Ubuntu’s six month release cycle is too often too soon. Some
even say that there are not enough changes to 10.04 to warrant an
upgrade.

I think they are wrong.

In Ubuntu 10.10,
there are many small improvements that have been made to polish the
distribution even more. For starters, the installer has received a lot
of attention. It is now a lot more attractive, and more importantly,
has been made simpler for novices. Of course, as is usual, there is the
live CD mode so that you can try out the distribution before actually
installing.

One criticism I
have of recent versions of Ubuntu is that you need a solid Internet
connection to get some things actually working. I think this is a
function of the fact that the makers (Canonical) are trying to pack
more and more into a single 700MB CD-ROM. In our environment, that is
not the most practical of things. Aside from that, I have no other
complaints really.

The most important
part of this upgrade is that Gnome has been updated to 2.32 (for KDE
users, the KDE version Kubuntu has KDE4.5). Also, the startup time has
improved even more. There is new wallpaper and the sound indicator now
includes music controls; so you can play music without having to open
your music application. This of course helps in saving memory, although
that will not be a concern for a lot of users.

Ubuntu One is
better integrated than ever. Ubuntu One is Ubuntu’s online file storage
service, which gives you 2GB of online storage for free. This allows
you to share files across multiple Ubuntu computers. Personally, I’ll
stick with Dropbox, but it is great to see Canonical plugging away at
this and attempting to get it right.

Apparently as well,
more people are signing up because the Ubuntu One Music Store has an
even larger selection of music than the last time I checked, but I
still could not find Fisherman’s Koko! As is usual, proprietary codecs
such as Flash did not work out of the box, but it was up and running in
a few minutes. Ubuntu’s default programs for multimedia include Brasero
for CD burning, Movie player, Rhythmbox to play music, and PiTiVi for
video editing. Great programmes, but since I am a KDE person, the only
one that survives on my computer is PiTiVi.

Of course, if you
are not happy with the default selection, just connect your computer to
the Internet and head into the much improved Software Centre.

One of the great
new features that still has me drooling is the updated Ubuntu Software
Centre and its ‘Featured’ and ‘What’s New views for showcasing
applications. A ‘For Purchase’ software category has also been added so
you can buy that proprietary software that you want.

Operators of domiciliary accounts are lamenting the charges on maintaining such accounts, saying that the arbitrariness of the charges makes them unjustifiable.

Some bank officials, however, say though the charges are steep in some cases, running a domiciliary account is not essential unless it is absolutely necessary.

“Bank charges on domiciliary accounts cannot be fixed,” says a senior staff of Afribank.

“The charges are dictated by the market. This thing is being regulated by the market. There is nothing you can do about it.

“Savings rates, currents account rates are regulated. If you give money to the bank to keep, you know what the banks would give; it can’t go below a certain rate or higher. But in terms of foreign denominated accounts, exchange rates also swing. It’s not stable, it’s always moving. So the rates cannot be static. If they say five percent, for instance, and the rates fall, there would be no basis to hold onto that rate. It’s a matter of supply and demand,” the Afribank official said.

“When you use credit cards, for instance, you know it is foreign currency denominated. When you are to be debited, we are going to look at the rates at that time. Take the Mallam who buys a dollar at N155 today, and a buyer says he wants to buy at N152 today, because that is what he bought a dollar the previous day, it won’t work. He has to look at the rates of that day,” he said.

A domiciliary account is an account in any foreign currency. It can be operated by customers upon fulfilment of all ‘know-your-customer’ requirements by the customer.

No benefit for the charges

But some bank customers argue also that banks are not offering services to justify their charges.

“I personally don’t see any problem in an individual having such an account, because I have one myself,” said Olufemi Ade, a former staff of Bank PHB.

“The only issue is that the charges are not justified and in most cases, one doesn’t get good features with the products,” Mr. Ade added.

Daniel Demilade, a customer of Guaranty Trust Bank, said charges on domiciliary accounts could be better regulated.

“Without prior notification, the bank withdrew about N8000 from my savings account with the bank, for charges related to my domiciliary account,” Mr. Demilade said.

“They said it was for the deduction of a new Dollar master card for my domiciliary account. They said they sent prior messages, but I didn’t see any,” he said.

A source at Spring Bank said that the charges should be regulated, to avoid irregularities and the issue of banks taking advantage of their customers.

“It is supposed to be a fixed amount. One bank is not supposed to be charging higher than others,” he said.

Customer care services of various banks that were visited said that there are no fixed service charges of domiciliary accounts.

“It’s a system charged account, it has random charges, not fixed” a staff of Zenith Bank stated.

At Intercontinental Bank, $20 is usually charged on withdrawals or transactions on domiciliary account, which must have at least $15 dollars in balance.

The Lagos State
government has claimed that there is no multiple taxation in the state
and has urged that tax payers be enlightened to ensure they are not
unduly extorted by touts, in the name of taxes.

Governor Babatunde
Fashola said this at a forum organised by a group, Women In Management
and Business, held at the Lagos City Hall for chief executives of
corporations. The business executives lamented that indiscriminate
charges, poor infrastructural facilities in some areas in the state,
unemployment, multiple taxation, and harassment from state officials,
especially the Lagos State Traffic Management Authority (LASTMA), among
others, are part of the challenges of doing business in Lagos State.
Participants alleged that multiple taxes, a situation where the same
income is subjected to more than one tax treatment; unauthorised and
unclear charges, is fast killing businesses in the country’s major
business district.

Government’s response

“There are no
instances of multiple taxes in Lagos,” said Mr Fashola. “There are
either legal or illegal fees or levies. Multiple taxes don’t exist in
Lagos. We have three levels of government in the country. There can be
multiple taxes only if all three levels of government are charging for
the same thing. Take for instance, taxes for operational results go to
the federal government, advertisement goes to the local government, and
taxes on employees go to the state. Every party have their own distinct
charges.”

Though the origin
of ‘multiple taxation’ is not clear, complaints as regards the menace
became more prominent and rampant in the 1980’s. Experts say the
declining rate of disbursable funds by the federal government might
have led the state and local governments to seek alternative sources of
internally generated revenue. Multiple taxes confront the manufacturers
and private sector under different umbrellas through import duties,
export and excise duties, sales and VAT, withholdings and income taxes,
mobile advertising and billboard levies, educational levies, social
responsibility charges among others, which the participants say is
telling on the state’s business environment.

Drawing the battle line

The governor said
that there are levies imposed on business men and women by touts, which
must be addressed by the individuals themselves, because the aim of the
state government is to maximise revenue without imposing a burden on
the people. Mr Fashola, who gave phone numbers to be called in an event
of unclear taxes, urged the business community in the state to take
their destiny in their own hands and address illegal levies. “Engage
that system more vigorously,” he said. “We have come up with the list
of things that can be taxed, which is available. We have also urged
officials to stop collecting cash, the instruction is that you pay into
the bank.”

Participants at the event urged the governor to create more
institutional structure to be able to engage in interactive sessions
regularly, where people are given the opportunities to factor in their
own opinions on the state policies before and during implementation.
“We need institutional structures where we would be able to factor in
our own perspective, as regards the state policies,” said Segun
Oshinowo, a participant at the event. “We shouldn’t have a situation
where the meal has been prepared and we are being forced to eat only to
discover that there isn’t salt in the middle or key ingredients are
missing.”

Egypt’s Housing and
Development Bank (HDB) and state-owned Egyptian Arab Land Bank (EALB)
are being restructured with an eye toward a possible merger within the
two next years, the head of the two banks said.

Chairman Fathy
El-Sebai completed a capital increase at HDB earlier this year that
reduced the government’s stake to between 62 and 64 percent and is in
the final stages of restructuring EALB, Egypt’s fourth-biggest state
bank by assets.

“I have a strong
feeling there is the viability for them to merge and add more value to
the two institutions,” Sebai told Reuters in an interview.

However, the ultimate decision whether to merge them was the government’s and not his, he added.

A combined entity would be Egypt’s sixth or seventh biggest commercial bank in both the state and private sector.

Sebai is among a
group of bankers brought in by the government from the private sector
in the early part of the decade to reform state banks.

These include Bank
of Alexandria, which was sold in late 2006 to Italy’s Intesa Sanpaolo,
and Banque du Caire, whose planned privatisation in June 2008 was
aborted after offers did not meet the government’s minimum price.

At the time of the
Banque du Caire offering, many Egyptians criticised the government’s
privatisation programme, saying assets were being sold off too cheaply,
and since then the government has not tried to sell any other major
state assets.

Free float

HDB’s 450 million
Egyptian pound capital increase boosted the bank’s free float to
between 36 and 37 percent from 10 percent, Sebai said.

“This was the idea, to make a kind of a privatisation, not for an anchor investor, but for the public, for everybody.” The bank,

whose capital is
now 1.15 billion pounds, will use the new funds to install an advanced
IT system and expand its branch network to 100 by the end of 2013 from
57, he added.

Sebai said EALB’s
restructuring had been more complicated because much of its lending had
been to tourism and residential projects that stalled when an Egyptian
real estate bubble ended early in the decade.

“The owners didn’t want to put more money in the tourist projects and the banks also stopped funding,” he said.

EALB shareholders
agreed in 2005 to delay plans for merging with HDB until EALB’s
finances could be straightened out. Sebai plans to finish the bank’s
restructuring by June 2012.

“The target is to have the bank ready for the merger, which can be done at any minute by the shareholders,” he said.

“But my plan is to
finish the restructure process and finish all the problems in the bank
to be ready now, either to continue to stand alone or to merge.” Sebai
said rising property values meant HDB’s loans, mainly in mortgages and
credit to individuals,

have been profitable despite a slow judicial process to gain control of homes when borrowers default.

HDB’s assets were 17.85 billion pounds at the end of December, while EALB’s assets were about 20 billion at end-June.

The vice president,
Namadi Sambo, has disclosed that the federal government has earmarked
N500 billion lifeline for the manufacturing sector to reactivate ailing
industries.

Mr. Sambo announced
this at the weekend in Kaduna while on a visit to the state. He said
that the lifeline was part of the administration’s efforts to speed up
the country’s economic development and create employment opportunities
for the youth and women.

The vice president
said that the funds would soon be released to manufacturers, adding,
however, that N40 billion, out of the N100 billion-textile revival
fund, had been disbursed.

Mr. Sambo also said
that 25 rail locomotives had been imported, adding that the locomotives
would soon commence operations, as part of efforts to revive rail
transportation in the country.

He said that the
federal government would soon award the contract for the rehabilitation
of the Kaduna-Abuja and Lagos-Ibadan fast train services.

He said that the efforts were aimed at revamping the transport system and facilitating movement of goods across the country.

In the four years
to 2003, output growth in Nigeria averaged about 4% (then considered a
significant increase on the 2.8% rate of growth recorded in the 1990s).
Some of this increase came from a more stable environment, as the
economy adjusted to the new democracy. With a parliament looking over
the shoulders of the executive arm of government, most economic units
were at least assured that the policy environment was going to be less
volatile than was the case under the opaque workings of military rule.

Therefore, even in
the absence of new entrepreneurial effort, growth could and did feed
off the new optimism. Still, this was nowhere near the dividends we had
been told would accrue to us from the transition to democratic rule.
The NEEDS document duly argued in 2005, that in order to reduce poverty
in the country, the economy had to grow by “at least 7-8% annually”.

This was before a
rash of reforms by the Obasanjo administration boosted entrepreneurial
activity in certain sectors of the economy. The telecommunications
sector is arguably the poster child of that period. By the time the
Obasanjo administration left office, the NEEDS growth target had been
breached.

But instead of the
new growth levels being driven by inflows of new capital and investment
funds, revenue over-performance (with oil prices nudging new highs)
drove the new output levels.

A democratic
caudillo imposed his will on fractious sub-national governments, and
through the “excess crude account” threatened to address the volatility
that has dogged public expenditure management in the country, since the
economy became addicted to crude oil-based revenues. Unfortunately, the
absence of policy coherence between sub-national political units and
the government at the centre required institutional responses, if the
national plan and budgeting processes were to have any meaning.

It is fair to
assume that at some point, the Obasanjo administration reached its
frontiers as an agent of reform, for even it could not find the
political will to follow through the logic of its new policy choices.
Ought the electorate to hold this failure against that government? Yes;
and no!

Yes, because owing
to the popular nature of the processes by which that government came
into office, even the stars were aligned in its favour. The people were
worn to the bone from the epic effort that was needed to oust the
military. The “forces of reaction” were even worse off. With their
backs to the wall, we awaited with baited breath our new government’s
administration of the coup de grace. This didn’t happen, however,
because the Obasanjo administration was handicapped by a congenital
defect. The selfsame circumstances of its birth were a real and present
constraint.

Thus, we were still
waiting for the telling blow to the interest groups whose choices had
held back the commonweal for decades, when the Yar’Adua government
assumed office. Upside claims for this administration notwithstanding,
it remains something of an enigma. History may yet judge it well, but
it only managed stasis everywhere.

Bereft of a real
change agenda, it was able to maintain growth rates at the 7% level
reached by the Obasanjo administration only by drawing down on the
savings set aside by the latter. The more ravenously it dipped into the
pool of savings, the more aggressively it drove up government
consumption as a share of domestic output; and at the expense of both
private consumption, and investment by businesses in expanding or
building new capacity.

Consequently, we
have had four years of growth without new jobs being created. Nothing
wrong with all of these in a democracy. If nothing else, the four-year
cycle affords the electorate the opportunity to turf out perspectives
that they find incongruent with their needs.

Surprising
therefore, that the stories coming out of the campaign headquarters of
would-be candidates in next year’s presidential elections
unconscionably rehash old platitudes. From IBB, through Nuhu Ribadu, to
Goodluck Jonathan, we hear of projects to return Nigeria to its past
(?) glory.

Nothing, alas, is
said about the particulars of these projects. How much of it would be
because of new funding initiatives in education? How much because we
would be investing in new infrastructure? And how much because we would
change the way government is run?

How would the projects be sequenced? And where will the much-needed funding come from? Not a squeak from anybody!