Nigeria Content Online

Equatorial Guinea sits in the heart of Africa and is the fourth
highest producer of crude oil in sub-Saharan Africa after Nigeria, Angola, and
Sudan. It has reaped huge revenues from crude oil sales since 1995 when
commercial export began, although discovery of the product was made in the
1960s. It is one country whose political experience will make the years of
brute military rule in Nigeria a mere child’s play in comparison.

The current maximum ruler of that country took over power in a
bloody military coup in 1979, eleven years after that country’s independence
from Spain. At that time, Teodoro Obiang Nguema Mbasogo was a Lieutenant
Colonel and his uncle, Francisco Macia Nguema, was the president. He is said to
have personally supervised the execution of his uncle by firing squad and has
reigned supreme over the country of less than a million people since then.

The nation’s GDP of about $37,900 is many times above that of
Nigeria. The truth, however, is that the high GDP does not translate to a
better life for the people. Since the ascendancy of crude oil as a major income
earner, other aspects of the economy, especially production of agricultural
produce such as cocoa, have suffered neglect. Does that not remind you of
Nigeria?

While looking up on President Nguema, one could not avoid
visiting the pages of Wikipedia where parts of the entry on this man reveals
the following: “In July 2003, state-operated radio declared Obiang to be a god
who is “in permanent contact with the Almighty” and “can decide to kill without
anyone calling him to account and without going to hell.” He personally made
similar comments in 1993. Despite these comments, he still claims that he is a
devout Catholic and was invited to the Vatican by John Paul II and again by
Benedict XVI. Macías had also proclaimed himself a god.’

Standing up to the despot

The president, his family, relatives, and friends are said to
own most businesses in the country. With the severe curtailment of freedom in
the country, it has come as a vent of fresh air when the writer, Juan Tomas
Avila Laurel, called for change and embarked on a hunger strike demanding an
end to the despotic reign in his country.

In a letter to Jose Bono Martinez, the president of Spanish
parliament, dated 11 February 2011, Mr. Laurel states among other things that,

“Since you believe so deeply in the moral solvency of President
Obiang, who has been in power since 1979, we fervently request that you exert
some influence and take steps towards the formation of a government of
transition; one in which those who have held positions in the last 32 years in
Equatorial Guinea must not take any part.

“This is not a political demand, as it might seem to you, but a
socially and morally driven one. We cannot continue living under a dictatorship
that eats away at our very souls.

“Mr. Bono, all we are asking is that you find asylum in a safe
country for Obiang, his son Teodorin, first lady Constancia, and his brothers
and cousins, the generals and colonels who maintain this unspeakable regime. We
believe that one-third of the money that any one of them has deposited in banks
abroad would be enough to support themselves for the rest of their days. The remaining
sum has to be returned to the country.”

The letter ends with a painful plea for intervention: “Mr. Bono,
it is not fair for me to put my life in your hands. I will not deny, however,
that whatever happens to me will depend in great measure on what you do.”

Gaddafi’s oily stand and
neo-philanthropists

The events in North Africa and in the Middle East clearly
highlight the fact that crude oil has been largely responsible for the
entrenchment of crude regimes in the region.

This is particularly visible in Libya where the man who has been
in power for over four decades clings on, threatens to cleanse the country of
protesters house to house and if necessary blow up the oil and gas fields of
the country.

This threat has introduced a new dimension to the volatility of
crude oil supply and threatens to push prices to record high. Call him what you
like, but Mr. Gaddafi and his cohorts have fed from the feeding bottle of crude
oil and taking that from them without a period of weaning is bound to result in
the slaughter and tantrums that is the hall mark of the regime in Tripoli.

A quick look back at the third week of February 2011 shows that
as we saw a fine being slammed on the oil giant, Chevron, for polluting the
Amazonian region of Ecuador, we heard of the company’s philanthropic move in
the Niger Delta.

The gesture is a clear case of philanthropic tokenism. It
appears that Chevron sought to draw attention away from the long-awaited
verdict from Ecuador by moving across the Atlantic and displaying a suspect
front of compassion in the bloodstained and oil soaked creeks of the Niger
Delta. The link and the timing are inescapable.

The company announced with much fanfare a splash of $50 million,
ostensibly to ignite economic development and tackle conflict in the region –
of which, it must be said, the company admitted to being a contributor in the
past.

The money is being funnelled through the company’s Niger Delta
Partnership Initiative and the United States Agency for International
Development (USAID) and will be spent over the next four years. The thrust will
obviously be to generate employment since the oil company hires only a tiny
fraction of the millions it has impoverished through the destruction of the
creeks, swamps, farmlands and forests that they depend on for their livelihoods
through oil spills, gas flares, and the dumping of other toxic wastes.

These are interesting days indeed. Without doubt, crude oil
business is not only volatile, but explosive. It is the stuff that oils the
machinery of despotism and it is the stuff that blinds the world to the bloods
that flow on the streets as people fight for liberty.

It is also the stuff that bluffs and seeks to blind us from
demanding environmental justice but accepting tokens.

The forecast for the world economy growth this year remains
unchanged, following “increased activity in the manufacturing sector” of some
developing countries, the Organisation of the Petroleum Exporting Countries
(OPEC) has said.

The OPEC, in its Oil Market Report, February 2011, said the
world economic growth in 2011 “remains unchanged at 3.9 per cent,” noting that
it had previously revised it up to 3.9 per cent in January from the 3.8 per
cent initial projection.

Consequently, the report said the United States economy “is now
expected to expand by 2.9 per cent and the Euro-zone raised to 1.4 per cent.
Growth for developing countries remain almost unchanged, with China growing at
8.8 per cent and India at 8.5 per cent in 2011.”

However, the report said, “despite increased activity in the
manufacturing sector, which has led to a broad-based improvement in global
sentiment, significant challenges remain.

“The extraordinary sovereign debt levels, rising inflation
rates, combined with the possibility of overheating in developing countries,
constitute concerns that might influence the 2011 growth trend.”

Nigerian economy

Meanwhile, Nigeria’s government said it is targeting economic
growth of 10 per cent in 2011 because its economy fared better last year than
those of most advanced economies of the world, with her Gross Domestic Product
(GDP) growing by 7.85 per cent, compared to a global average of 3.9 per cent.

Finance minister, Olusegun Aganga, last weekend, said,
“Nigeria’s GDP growth rate was higher than those of the high income nations,”
adding that details of the country’s macro-economic performance of the
different sectors of the economy showed that agriculture, wholesale and retail
trade, as well as manufacturing, accounted for some of the highest
contributions to the economy during the year.

However, Dimeji Akintayo, an analyst at Resource Cap, a business
advisory company, said the manufacturing sector “in the real terms has not
contributed enough to the Nigerian economy” despite “the human and natural
resources capacity that abound in the country.”

He said according to the data from the National Bureau of
Statistics, “our manufacturing sector only contributed less than eight per cent
last year when compared with the over 34 per cent in telecommunications sector.
If the government can focus on improving power generation, Nigeria as a nation
that consumes products from other countries will see its manufacturing industry
generating more jobs and increase the GDP.”

The Central Bank had last year initiated a N200 billion
manufacturing and power/aviation sector intervention loan fund in order to
rescue the moribund manufacturing sector of the economy.

The CBN said the funds, which would be disbursed through commercial banks,
are expected to be accessible this year.

Equatorial Guinea sits in the heart of Africa and is the fourth
highest producer of crude oil in sub-Saharan Africa after Nigeria, Angola, and
Sudan. It has reaped huge revenues from crude oil sales since 1995 when
commercial export began, although discovery of the product was made in the
1960s. It is one country whose political experience will make the years of
brute military rule in Nigeria a mere child’s play in comparison.

The current maximum ruler of that country took over power in a
bloody military coup in 1979, eleven years after that country’s independence
from Spain. At that time, Teodoro Obiang Nguema Mbasogo was a Lieutenant
Colonel and his uncle, Francisco Macia Nguema, was the president. He is said to
have personally supervised the execution of his uncle by firing squad and has
reigned supreme over the country of less than a million people since then.

The nation’s GDP of about $37,900 is many times above that of
Nigeria. The truth, however, is that the high GDP does not translate to a
better life for the people. Since the ascendancy of crude oil as a major income
earner, other aspects of the economy, especially production of agricultural
produce such as cocoa, have suffered neglect. Does that not remind you of
Nigeria?

While looking up on President Nguema, one could not avoid
visiting the pages of Wikipedia where parts of the entry on this man reveals
the following: “In July 2003, state-operated radio declared Obiang to be a god
who is “in permanent contact with the Almighty” and “can decide to kill without
anyone calling him to account and without going to hell.” He personally made
similar comments in 1993. Despite these comments, he still claims that he is a
devout Catholic and was invited to the Vatican by John Paul II and again by
Benedict XVI. Macías had also proclaimed himself a god.’

Standing up to the despot

The president, his family, relatives, and friends are said to
own most businesses in the country. With the severe curtailment of freedom in
the country, it has come as a vent of fresh air when the writer, Juan Tomas
Avila Laurel, called for change and embarked on a hunger strike demanding an
end to the despotic reign in his country.

In a letter to Jose Bono Martinez, the president of Spanish
parliament, dated 11 February 2011, Mr. Laurel states among other things that,

“Since you believe so deeply in the moral solvency of President
Obiang, who has been in power since 1979, we fervently request that you exert
some influence and take steps towards the formation of a government of
transition; one in which those who have held positions in the last 32 years in
Equatorial Guinea must not take any part.

“This is not a political demand, as it might seem to you, but a
socially and morally driven one. We cannot continue living under a dictatorship
that eats away at our very souls.

“Mr. Bono, all we are asking is that you find asylum in a safe
country for Obiang, his son Teodorin, first lady Constancia, and his brothers
and cousins, the generals and colonels who maintain this unspeakable regime. We
believe that one-third of the money that any one of them has deposited in banks
abroad would be enough to support themselves for the rest of their days. The remaining
sum has to be returned to the country.”

The letter ends with a painful plea for intervention: “Mr. Bono,
it is not fair for me to put my life in your hands. I will not deny, however,
that whatever happens to me will depend in great measure on what you do.”

Gaddafi’s oily stand and
neo-philanthropists

The events in North Africa and in the Middle East clearly
highlight the fact that crude oil has been largely responsible for the
entrenchment of crude regimes in the region.

This is particularly visible in Libya where the man who has been
in power for over four decades clings on, threatens to cleanse the country of
protesters house to house and if necessary blow up the oil and gas fields of
the country.

This threat has introduced a new dimension to the volatility of
crude oil supply and threatens to push prices to record high. Call him what you
like, but Mr. Gaddafi and his cohorts have fed from the feeding bottle of crude
oil and taking that from them without a period of weaning is bound to result in
the slaughter and tantrums that is the hall mark of the regime in Tripoli.

A quick look back at the third week of February 2011 shows that
as we saw a fine being slammed on the oil giant, Chevron, for polluting the
Amazonian region of Ecuador, we heard of the company’s philanthropic move in
the Niger Delta.

The gesture is a clear case of philanthropic tokenism. It
appears that Chevron sought to draw attention away from the long-awaited
verdict from Ecuador by moving across the Atlantic and displaying a suspect
front of compassion in the bloodstained and oil soaked creeks of the Niger
Delta. The link and the timing are inescapable.

The company announced with much fanfare a splash of $50 million,
ostensibly to ignite economic development and tackle conflict in the region –
of which, it must be said, the company admitted to being a contributor in the
past.

The money is being funnelled through the company’s Niger Delta
Partnership Initiative and the United States Agency for International
Development (USAID) and will be spent over the next four years. The thrust will
obviously be to generate employment since the oil company hires only a tiny
fraction of the millions it has impoverished through the destruction of the
creeks, swamps, farmlands and forests that they depend on for their livelihoods
through oil spills, gas flares, and the dumping of other toxic wastes.

These are interesting days indeed. Without doubt, crude oil
business is not only volatile, but explosive. It is the stuff that oils the
machinery of despotism and it is the stuff that blinds the world to the bloods
that flow on the streets as people fight for liberty.

It is also the stuff that bluffs and seeks to blind us from
demanding environmental justice but accepting tokens.

Nigeria’s long quest for endorsement as Extractive Industries
Transparency Initiative (EITI) compliant country has got the nod of the board
of the international transparency group during its fifth global conference of
the EITI in Paris, France.

The board noted Nigeria’s commitment to the EITI process, adding
that the board and management of the Nigerian Extractive Industries
Transparency Initiative (NEITI) had met all the conditions identified for the
country during EITI Board’s meeting in Tanzania last October.

It expressed satisfaction with Nigeria’s commitment to openness
and transparency in the management of revenues from the oil, gas, and solid
mineral sectors through its support to the work of NEITI and its audit
processes.

Other revenue avenues

Emphasising the need to extend its EITI implementation to cover
revenue flows from Nigeria’s interest in the Joint Development Zone (JDZ) of
Sao Tome and Principe as well as the solid mineral sectors, the EITI urged
Nigeria to ensure that implementations of ongoing actions in these sectors are
effected latest by next year.

The EITI International welcomed the revitalisation of
inter-ministerial task team to address remediation issues identified by NEITI
audit reports and other far reaching measures by Nigeria through NEITI to
enthrone transparency and accountability in the extractive sectors.

The EITI International board expressed satisfaction with the
content of the recent audit report by NEITI, which covers the period,
2006-2008, and called for the implementation of the recommendations contained
in that report.

“Nigeria’s endorsement as EITI Compliant Country is encouraging.
But, the challenge now for the country is to ensure that the established high
standards are maintained and sustained in NEITI’s interface with oil and solid
mineral sectors, particularly in the discharge of its mandates under the NEITI
Act of 2007,” NEITI executive secretary, Zainab Ahmed, said yesterday.

NEITI chairman, Assisi Asobie, who led the delegation to the
conference, said the development is an invitation to investors to explore the
opportunities in the country’s extractive sector with the global recognition of
Nigeria’s openness.

Nigeria was adjudged close to compliant at the last meeting of
the EITI Board held in Tanzania last October and was given six conditions to
meet before it could become an EITI compliant country.

The conditions include publication of 2006-2008 NEITI audit
report, publication of a board charter to streamline the board of NEITI and the
secretariat, among others.

At the conference, four other countries were also pronounced as compliant.
They are Norway, Niger, Kyrgyzstan, and Yemen, bringing to 10 the number of
complaint countries out of 33 countries that have so far embraced the EITI
globally.

The Nigeria Labour Congress (NLC) has advised Union Bank to
fulfil its part of the terms of agreement which both parties reached on Friday,
after days of picketing the bank.

Denja Yakub, the Assistant Secretary General of the Nigeria
Labour Congress said at the weekend that the union has decided to suspend the
strike but that it will not hesitate to unsheathe its sword if the bank fails
to keep its part of the agreement. “Yes, we have suspended the strike. We had a
meeting with the bank and the Minister of Labour and Productivity and we were
able to reach an agreement.

The meeting lasted up till 2.30am on Friday. We hope that Funke
Osibodu, the MD of the bank will implement the agreement because if she
doesn’t, we will roll back our terms,” he said. Mr. Yakub said the bank has
decided to meet all the demands of the Union. “They met all our demands. The
union is now being recognised by the bank and they have agreed to call back
those that were sacked, we will give her sometime and watch her implement these
terms” he said.

Business activities have been disrupted at the headquarters of
Union Bank in Marina, Lagos and at branches across the country for days. The
NLC, led by its president, Abdulwaheed Omar, picketed the organisation over its
decision to sack workers and ban union activities. Even the intervention of
Yakubu Alkali, the commissioner of Lagos State Police Command, could not broker
peace between both parties, leading to the decision to go on strike, from an
ongoing picketing.

Back to work

Francis Barde, the spokesperson of the bank confirmed that the
NLC has called off the picketing of the bank and directed its members
nationwide to vacate the premises of the Bank nationwide for smooth operations.

“The order followed the agreement reached last night under the
intervention of the Minister of Labour and Productivity, Emeka Wogu with the
Union Bank and NLC which suspended the industrial action against the bank and
sought to cooperate with each other in ensuring permanent industrial peace” he
said.

Mr. Barde also said in a statement signed and issued on Friday
that the move was the outcome of constructive and fruitful deliberations.
“Following constructive and fruitful deliberations, we are pleased to announce
that all issues in dispute that led to the current action between the Nigeria
Labour Congress (NLC) and the management of Union Bank of Nigeria PLC have been
addressed to the mutual satisfaction of all parties”, he added.

The workers have accused the bank’s management of mismanagement,
undermining workers solidarity, and indiscriminate staff layoff. The dispute
reached its climax last month when the management sacked 13 staff and withdrew
the recognition of the chapter of the Association of Senior Staff of Banks,
Insurance and Financial Institutions (ASSBIFI).

Normal banking activities are expected to resume today.

The Central Bank of
Nigeria’s (CBN) insistence, last year, on banks’ compliance with
section 5.3.10 of its ‘Code of Corporate Governance for Banks in
Nigeria Post-Consolidation’ raised more questions than it answered.

The CBN’s action
provided one answer: by requiring that “non-executive directors should
not remain on the board of a bank continuously for more than 3 terms of
4 years each, i.e. 12 years,” it attempted to address the task of
ensuring both continuity and the injection of fresh ideas into banks’
boards of directors.

The remaining
questions are a lot more, however, and more pressing. Arguably, the
most obvious problem is why it took the apex bank four years between
the effective date for the implementation of its corporate governance
code, and its insistence on the implementation of a key provision of
that code.

Is it the case that
the apex bank had dropped balls on its watch? Troubling though this
likelihood is, it speaks to the huge burden of combining the management
of monetary policy and banking supervision under one roof – a dilemma
that the directors of the IMF recently referred to as the “potentially
conflicting objectives of monetary policy”.

The world over, the
parameters of the arguments for and against this practice have been
altered by the recent global financial and economic crisis. However, a
decision either way in our case must consider two important facts.

First is that
monetary policy management is an inchoate practice here, a fact further
complicated by appalling levels of fiscal illiteracy at the executive
level. The second consideration derives from the venal nature of life
here. Because our default moral setting is a penchant for the easy way,
a regulator’s assignment was always going to be difficult.

However, this
difficulty is the more so when the regulator appears ignorant of its
own rules. This was always an outside explanation for the apex bank,
having dropped the ball on industry compliance with its own corporate
governance code. It, however, became a real possibility recently, when
the newspapers reported the deputy governor, financial system stability
of the CBN, as having hinted at a conference in Lagos, last Wednesday,
that appointments of sufficiently senior bank officials would now be
subject to the apex bank’s authorisation.

The apex bank may
indeed be reforming its operations in order that it can better take on
the task of strengthening the banking industry’s risk management
framework, but I know that banks in the country have regularly reported
promotions to senior levels to the CBN as a matter of course. And that
the CBN has had cause to object to the appointments by some banks into
certain offices of persons whose fitness and propriety for the new
responsibilities it had doubts over.

Is the CBN dropping
the ball because of a failure to read from its own scripts? Something
about how the CBN has proceeded with the authentication of banks’
customer account details nationwide is highly suggestive of a need to
hold the apex bank’s feet closer to the fire.

Why would it treat
work-in-progress the same way we treat voters’ registration here? I
was, therefore, minded to look again at the corporate governance code,
in search of provisions that the industry may currently be in breach
of, despite the fact that “compliance with the provisions of (the) code
is mandatory”.

What about
independent directors? In “civilised” jurisdictions, the position of
the independent director was conceived of in response to the “conflict
of interest” challenge. Increasingly, companies required persons on
their boards who – unburdened by interests in or previous or past
affiliations with the company or its subsidiaries – can discharge their
duties as directors for the exclusive benefit of these companies.

Responding to this need, the apex bank insists in its corporate
governance code that “at least two (2) non-executive board members” of
banks should be independent directors. Now, in the absence of reports
to the effect that the apex bank has sanctioned banks for breaching
this provision, we may safely assume that there are 48 independent
directors on the board of Nigerian banks.This is one of the many stats
on this economy that challenges one’s belief. Why not solve the problem
by requiring banks to list in their annual reports the number of
independent directors; and the nature of their independence?

Finance ministers of the world’s major economies reached a
fudged accord on Saturday on how to measure imbalances in the global economy
after China prevented the use of exchange rates and currency reserves as
indicators.

French Finance Minister, Christine Lagarde, who chaired the
Group of 20 talks, said the deal nevertheless represented a significant step
towards better coordination of economic policies worldwide to help prevent
another financial crisis.

“It wasn’t simple. There were obviously divergent interests but
we were able to reach a compromise on a text that seems to us to be both balanced
and demanding in its implementation,” she told a news conference.

Ministers and central bank governors agreed on a list of
indicators including public debt and fiscal deficits, private savings and
borrowing, the trade balance and other components of balance of payments such
as net investment flows.

But at Chinese insistence, there was no mention of the real
effective exchange rate or of foreign currency reserves.

“Reserves have been dropped,” Mr Lagarde acknowledged, adding
that the deal included a mechanism to take account of exchange rates when
assessing the overall balance of payments.

The United States and other western countries accuse Beijing of
keeping the yuan artificially undervalued to boost its exports, hence
accumulating massive foreign currency reserves that they say distort the world
economy.

U.S. Treasury Secretary, Timothy Geithner repeated after the
talks that China’s currency “remains substantially undervalued” and its real
exchange rate had not moved much despite a slow appreciation since a reform
last June.

“There is broad consensus that the major economies, not just
Europe, Japan and the United States but also the large emerging economies, need
to allow their exchange rates to adjust in response to market forces,” he said.

The world’s number two economy, which overtook Japan this week,
has resisted Western pressure to substantially revalue its currency to help
rebalance global growth.

China’s trade surplus has shrunk of late, perhaps explaining why
it prefers that measure.

Western and Japanese officials said the indicators would in
practice cover balance of payments and foreign reserves, even if those terms
had been omitted to assuage Beijing. Chinese Finance Minister Xie Xuren left
without speaking to reporters.

“We needed to be inventive about wording in the communique in
consideration for a country that did not want to use the term ‘current account
balance’. The statement lists components of the current account balance,”
Japanese Finance Minister Yoshihiko Noda told reporters.

No specific goals

Mr Lagarde said the indicators were not binding targets but
would lead to the drafting of guidelines for coordinated economic policies to
reduce distortions, and then to a mutual assessment process.

Germany, Europe’s biggest exporter, which has resisted U.S.
effort to set numerical targets for current account surpluses, said no specific
goals would be set for certain indicators.

The G20 ministers acknowledged that economic recovery was
diverging between developed and developing economies, but they differed in
their assessment of global inflation risks.

The communique noted that while growth was subdued in most
developed economies, with unemployment high, major emerging markets were
roaring ahead, “some with signs of overheating.”

European Central Bank President, Jean-Claude Trichet said
inflationary pressures coming from energy and commodities prices must be taken
seriously, and the ECB was determined to avoid second-round effects on wages.

But Mr Geithner said inflation risks in the United States were
moderate.

French President, Nicolas Sarkozy, who holds the G20 presidency
this year, urged ministers on Friday not to get bogged down by the indicators
dispute and welcomed the fact that China had agreed to host a seminar on
reforming the international monetary system in Shenzhen in late March.

France has also ran into opposition with its two other G20
priorities — greater transparency and regulation of commodities prices and
reform of the international monetary system.

The G20 communique said ministers agreed to work on
strengthening the international monetary system to help avoid disruptive
fluctuations in capital flows and disorderly movements in exchange rates.

China and Brazil complain that “hot money” inflows risk
destabilising the economies of emerging countries, pointing the finger at the
U.S. Federal Reserve’s money printing via a $600 billion bond purchase
programme.

With world shares at 30-month highs, investors seem content for
the G20 to take its time, whereas at the height of the crisis two years ago,
markets were baying for policy action.

As stock exchanges around the world merge to expand their
operations, financial analysts say the Nigerian Stock Exchange (NSE) is not
“ripe” for that kind of business. The New York Stock Exchange (NYSE), Euronext
and Germany’s Deutsche Bourse on February 15 reached an agreement to combine
business. If successful, the $10 billion deal will form the biggest exchange
operator in the world.

Also, the London Stock Exchange had on February 9 announced a
$6.9 billion bid to take over Toronto Stock Exchange operator TMX Group. The
move will create a combined group that will be jointly headquartered in London
and Toronto. The two companies are waiting for a review by the Canadian
government to finalise the process. However, Opeyemi Agbaje, an economic
analyst and chief executive officer of Resources and Trust Company Limited, a
business advisory firm, said,

“The Nigerian Stock Exchange (NSE) is a monopoly so the issue of
mergers may not be so relevant to us now,” adding that the global merger trend
“may be driven by profit and scale considerations since many global Exchanges
are now business ventures with profit objectives.” But Virginus Agada, a
stockbroker at Eurocomm Securities Limited, a stockbroking firm, disagreed that
the NSE is a monopoly market.

According to him, “The
issue of merger with another stock exchange cannot be thought of in our market
now. Is it not when you’re healthy that you begin to look for somebody to stay
with you? Our market is not that healthy and therefore it’s not ready for
merger talks now, but we may get there in the future.” He said although there
are benefits to enjoy in mergers such as economies of scale and chains of
ideas, “but I don’t think that should bother us now in this country. Right now
we’re trying to gain confidence from investors.”

He added that “no matter how large investors are willing to come
to the market; if you don’t have enough facility to support them they won’t get
quality benefits.” Mr. Agada, whose firm is one of the affected stock broking
firms yet to meet the NSE’s N70 million capital base requirement for
stockbrokerages, said, “If you want to merge, you should talk about things
other Exchanges can learn from you. We (NSE) have not even shown good examples
within the West Africa region and Africa at large let alone talking of the
developed worlds.”

Detola Olukorede, an equity analyst at Investment Option, a fund
management firm, said, “The NSE is not ripe yet for merger like it’s happening
around the world now.” He said this is because the nation’s bourse is still
“underdeveloped in terms of infrastructure and operation.”

Wave of mergers

The merger of the New York Stock Exchange (NYSE) Euronext and
Germany’s Deutsche Bourse is structured as a combination of Deutsche Bourse and
NYSE Euronext under a newly created Dutch holding company, which is expected to
be listed in Frankfurt, New York and Paris. According to the agreement, when
the merger is completed, Deutsche Bourse stakeholders are set to control a 60
percent stake, with NYSE Euronext investors commanding 40 per cent of the
combined mega-firm’s equity, on a fully diluted basis. The deal is, however,
expected to be closed at the end of 2011. After that, the merged group will
boast more than $20 trillion in annual trading volume and operations in several
European countries and the United States.

A similar case also happened in Asia. Singapore Exchange Limited and ASX
Limited, operator of the Australian Securities Exchange, announced their $8.3
billion merger proposal on October 25, 2010. The merger is expected to create
the fifth largest Exchange operator in the world. Meanwhile, reports say the
two companies released a revised proposal on February 15 in a bid to boost the
deal’s chances of getting regulatory approval in Australia.

The recently-introduced biometric Automated Teller Machines
(ATM) will help banks and customers check fraud complaints in the banking
industry, analysts have said. First Bank of Nigeria Plc introduced biometric
ATMs into the country.

The group managing director and chief executive officer of the
bank, Bisi Onasanya, speaking during the introduction, had said the ATMs were
purchased to protect the data resources of its customers.

The biometric ATM solution is available to the bank’s existing
cardholders who may wish to add biometric authentication as part of their
transaction approval process on First Bank ATMs in addition to PIN selection,
while new cardholders will be issued cards with only the biometric
authentication functionality.

Under the biometric system, cardholders are identified by their
fingerprints, making it almost impossible for any other person to use it in
case the card is lost or stolen. Victor Ndukauba, a finance and research
analyst at Afrinvest, an investment advisory and research firm said: “It will
help in terms of security. It will reduce the exposure to and tendency of
fraud, as regards the use of ATMs. It will have an impact because it would mean
fewer complaints from users.”

A random sampling of other banks showed that they are working on
improving their ATM security systems. At Oceanic Bank, a source who did not
wish to be quoted because he was not authorised to speak to the media, said
that while the bank may not have introduced the biometric ATMs to its
customers, they were willing to upgrade their technology for the convenience
and safety of their customers.

“Everything that would reduce the cases of fraud in all its
ramifications is what every bank is working towards,” he said, adding that
banks try to upgrade their existing technology as soon as new ones are
introduced into the market.

“We have upgraded to the chip and pin” a source at Spring Bank
said. “We are yet to introduce the biometric ATM but we make sure we upgrade
our technology for the security of our customers’ funds.”

A long way

Mario Yanez and Annuar Gomez of the University of Miami, School
of Business Administration in a paper titled ‘ATM and biometrics, a
socio-technical business model’, said that parallel to the development of the
industry, different modes of fraud have made it necessary to reinforce the
levels of security utilized in ATMs.

According to them, “Biometric technology is based on the
scientific fact that there are certain characteristics of living forms that are
unique and not repetitive for each individual; these characteristics represent
the only technically viable alternative to positively identify a person witout
the use of other forms of identification more susceptible to fraudulent
behaviour.”

Biometric identification is utilized to verify a person’s
identity by measuring digitally certain human characteristics and comparing
those measurements with those that have been stored in a template for that same
person.

According to them, banks, other financial institutions and
retailers could increase the volume and reduce their ATM unit transaction
costs; increase their revenues and expand their potential customer base using
the biometrics ATMs.

Biometrics is also increasingly included in a wide range of
verification applications in e-commerce, financial electronic transactions and
other financial transactions.

Banks are responsible

Ariyo Kosoko, the spokesperson of Interswitch Limited, an
electronic transaction switching and payment processing company, said that
banks are responsible for upgrading their ATMs.

“It is the banks, and not the connecting companies, that are
responsible for upgrading the technology of their Automated Teller Machines,”
he said. “We just help the banks in their connectivity and make sure cards can
work on machines. We provide interconnectivity. Upgrading the ATM technology is
really left at the discretion of the individual banks. Ours is to make sure
that notwithstanding any type of ATM technology, operated by the banks,
outdated or modern we provide the adequate interconnectivity.”

History of ATM fraud

For years, the banking industry has been fighting the battle of
fraudsters swindling customers through ATMs. Before the enforcement of the chip
and pin cards last year, the banking system was awash with complaints of the
“mysterious” disappearance of funds from customers’ accounts, as statistics
showed that at least 30 million dangerous ‘magnetic stripe’ ATM cards were
carried about by innocent citizens.

Experts said these toxic ATM cards were highly prone to fraud,
as they could easily be cloned once fraudsters got hold of certain information.
The criminals would swipe the band of magnetic material on the card, which
contains vital data, past a card reader or reading head. Although the rate of
reported ATM fraud has reduced over the months, experts say biometric ATMs
would guarantee more safety for customers’ funds.

The universality of music has made it a potent tool for brands
to utilise in building brand image and creating instant brand recall. Music has
been discovered to inspire and move the target audience to action. While some
brands use music creatively to promote the brand through radio jingles and TV
commercials, other brands adopt musical talent programmes to build brand
association with the target audience.

When Skye Bank introduced
‘Hakunna Matata’, it was one that resonated with the audience. The follow up
campaign, ‘‘I wish I have friend saying yes to my dreams” also provided
soothing relief. It has been discovered overtime that music has an enduring
effect on consumers especially when the brand has a mass appeal.

The music appeal in the Indomie “Mama do good” is one that every
child has adopted as a sing along. It really exemplified the brand values as
one that provides the satisfaction and fulfilment the consumers’ desire.
However, a major focus of this column is on talent discovery through music which
appeals more to the youth market.

The last edition of ‘Project FAME’ is one I will not forget in a
hurry. This is due to utmost importance my young boys attached to the
programme. My children were always excited with the performance of the
contestants. This is because of their musical prowess and talent. Matters got a
halt when my son almost compelled me to start voting for his preferred
contestants even when I am not an MTN subscriber!

The above illustrated story speaks volume about the enormous
gains of leveraging brand image through music.

Music is one platform that brands have been adopting to leverage
brand image and build followership. It is one veritable platform to build brand
loyalty amongst the core target. The good thing is that music is a broad
platform that appeals to all and sundry. Regardless of the age group, there is
a particular genre of music that appeals to a particular group.

Some brands have been using music as a springboard to identify
with some core target and build loyalty. This is exactly the case with the
Telecommunication companies. The MTN Project Fame is one that unearths the raw
musical talents of youth. It brings to fore the potentials and innate gifts of
the youth. This has a major impact as every talented youth looks forward to
feature in the programme. The Nigerian Idol show by Etisalat is also one
laudable platform to develop the potentials of youth in music.

This is one area that brands can still impact the lives of youth
by identifying talents and developing them. It should actually reach a stage
where music producers should fall over themselves to produce albums of such
identified stars. What this translates to is that a single brand can produce
several stars in music through their talents. When brands go extra mile to develop
youth, it reduces social vices and builds brand loyalty for such brands.
Through this, brands also demonstrate to youth that they can live without drugs
and other social ills.

Music platform also gives consumer experience that enable brands
create strong associations. This is also evident in the Regal Gin Fuji Slam
which has Fuji act, Wasiu Odetola (aka Pasuma) performing at the slams across
the South West region. Fuji music is acceptable to brand consumers across the
South West States and this was used as a springboard to connect with the target
audience. The brand leveraged music to promote brand benefits while also
creating fun and entertainment which are synonymous with the brand personality.

The benefits of leveraging brands through music are innumerable.
Brands should elevate the music platform by building brand icons through raw
talents. This will massively build loyalty and create “an army” of brand
loyalists. There should be a national event that should be a “must” for
participation. When brands builds music icons, it enhances brand image and
drive brand visibility across the target segment.

Through the musical talent shows, it has been a worthwhile
experience watching potentials being developed and skills harnessed for maximum
impact. A brand can establish an academy to train and nurture the musical stars
to establish themselves in their career. This should be the next level for the
sponsored musical shows. Beyond the prizes being won, there should be an
enduring legacy that brands should leave behind. There are still untapped
opportunities in this area that brands can leverage upon especially with the
army of youth without employment. Brands can still leverage marketing efforts
through a new high ground in building followership and retaining strong
pedigree for generations.

TO OUR DEAR READERS

While your comments and
criticisms are welcome to make this column better, please desist from making
unsubstantiated allegations. This column is not sponsored to perform hatchet
jobs for any brand or organization. It is not paid for to serve as a mouth
piece of any company.