Nigeria Content Online

The Nigerian
National Petroleum Corporation (NNPC) has outlined a grand plan to
refurbish and upgrade existing units of the Port Harcourt Refining
Company.

This is contained
in a statement signed by Levi Ajuonuma, the group general manager,
public affairs division of the corporation, and made available to News
Agency of Nigeria (NAN) in Abuja, on Sunday.

Mr. Ajuonuma stated
that the upgrading would be done through the execution of a
comprehensive Turn Around Maintenance (TAM) in the months ahead.

The refinery, which has capacity to refine 210,000 barrels per day (bpd), underwent a TAM last in 2000.

The National
Insurance Commission (NAICOM), on Sunday, said it has suspended the
operational licence of Spring Life Assurance Plc with effect from
October 19.

Lucky Fiakpa, the
assistant director, corporate affairs, stated this in a statement made
available to the News Agency of Nigeria (NAN) in Lagos.

He said that NAICOM
was acting in accordance with section 9 of the Insurance Act 2003, and
that this became necessary following the inability of the company to
maintain the statutory minimum capital of N2 billion.

According to him, N2 billion is required as minimum capital for underwriting life insurance business in the country.

An increasing
number of African nations and state-owned firms are expected to tap
international bond markets in the next few years, helped by investors’
hunger for emerging market debt and marking an upswing in fees for
Africa-focused banks.

The market may also
eventually see issuance by corporations in some of the larger
sub-Saharan economies outside South Africa, such as Nigeria and Angola.

South African
state-owned power utility, Eskom, and Zambia are just two expected
issuers in 2011. Angola, Tanzania, and Uganda also have dollar-bond
plans in the pipeline, while Kenya is seriously considering an issuance
if domestic yields rise, a senior Treasury official told Reuters on
Monday. Eskom has said it will tap U.S. and European bond markets as
part of a plan to raise up to $6.9 billion over the next three years,
while Zambia, Africa’s largest copper producer, has said it plans to
issue a $500 million overseas bond.

“I am convinced we
will see substantial issuance from Africa over the next two, three
years,” said Florian von Hartig, global head of debt capital markets at
South Africa’s Standard Bank.

“The sovereigns
will take the lead, but financial institutions and corporates, maybe
from Nigeria, maybe from Ghana, maybe from Angola or Kenya, will follow
suit,” he said in an interview on the sidelines of a capital markets
conference in Cape Town.

With interest rates
in the developed world hovering close to zero, investors are ploughing
into emerging market debt for higher returns. The yield on Ghana’s
10-year Eurobond maturing in 2017 is around 6 percent, while a similar
bond from Gabon is offering 5.2 percent.

Given the external
demand, issuing overseas can be a cheaper option for African
governments and corporations than their relatively small domestic debt
markets, provided they can offer a bond big enough to whet foreign
appetite.

Ghana’s Eurobond
was issued with a coupon of 8.5 percent, compared with the 13.95
percent on a three-year note issued locally the same year.

Big inflows

As of last month,
emerging market bond funds had attracted more than $41 billion this
year, according to data from research firm, EPFR Global, and more
investors are now looking beyond flagship emerging market issuers, such
as Mexico or Turkey.

Demand for African
overseas bonds will continue to hinge on the creditworthiness of
issuers, availability of easy money globally, and the level of rates
elsewhere, said Razia Khan, head of Africa research at Standard
Chartered in London.

She reckons the long-term outlook for issuances is strong, even with worries about global risk appetite.

“That window for
African issuance might close rather dramatically depending on what
happens with global risk appetite, of course, but in the longer term,
with African economies making real progress, and emerging in their own
right, expect to see much more issuance regardless,” Ms. Khan said.

In sub-Saharan
Africa, overseas bond issuance remains the domain of governments,
state-owned enterprises, and a handful of corporations in South Africa,
the continent’s largest economy and home to some of its biggest
companies.

Naspers, Africa’s
largest media group and an active acquirer of media and Internet firms
in emerging markets, issued a seven-year, $700 million bond with a
6.375 percent coupon in July. The company said some of the funding
would go toward acquisitions.

More South African
companies are likely to issue overseas debt to fund foreign ventures,
reckons Prasanna Nana, head of debt capital markets for South Africa at
Absa Capital, the investment banking arm of South Africa’s Absa.

“At the moment, the
large corporates can borrow at very good rates in rands in South
Africa, and the rand is what most of them need, so there is no real
push to go offshore. But I think once M&A activity starts picking
up, we might see more offshore activity,” Mr. Nana said.

Standard Bank’s von
Hartig is betting that corporations outside South Africa will begin to
tap overseas markets, although a necessary minimum issuance of
$250-$300 million will deter all but the biggest few firms in the
region. Some of the largest Nigerian and Angolan banks could be likely
candidates, he said.

Any increase in
bond issuance will be welcomed by international banks, which are
pushing to increase their fees and commissions as a weak global economy
continues to squeeze revenues.

Sub-Saharan debt
issuance totalled $5.6 billion in the first nine months of 2010, down
30 percent from the same period a year earlier, but still well above
the $1.6 billion in the first nine months of 2008, according to Thomson
Reuters data.

Deutsche Bank took the top spot for bookrunner of debt capital markets deals in the region, followed closely by Standard Bank.

Barclays Capital,
the investment banking arm of Barclays, which owns a controlling stake
in South Africa’s Absa, took the top spot globally for debt bookrunner.
In Sub-Saharan Africa, it came in at fifth place.

Third place was occupied by Japan’s Daiwa Securities, while Goldman Sachs took fourth.

Years ago, when I
first started working on computers, I was asked to repair two computers
that were at one of the tills in the old Gateway Bank. One look inside
those systems, and no one could convince me that they were not a health
hazard. I told my boss that I didn’t think that working on them would
be worth anybody’s while, as the amount of sludge that had accumulated
on the motherboards was just too much. Two things, to be honest; I was
just being lazy. But I was right.

You see, I was
ordered to go ahead and work on the computers, and having locked myself
into a room with them, proceeded to use a hand-jet first to blow the
dust off the insides of those computers. However, it all turned out to
be a waste of time, as the computers died soon afterwards anyway.
Hazarding a guess now, I think it was the extras, such as sludge, that
caused it. Maybe it was the fact that I was just a trainee then, but we
will never know.

What I do know for
a fact now is that dust is a particularly fine killer of computers.
Dust particles vary in size from as small as microns to as large as
micrometers. The larger particles tend to fall and stick to surfaces,
whilst the smaller ones tend to remain in the air. Dust particles
contain anything from skin cells, liquids (water or oils), organic
materials, minerals, metals, all depending on the environment in
question.

In a normal office
environment, the problems associated with dust are usually kept to a
minimum. Nevertheless, over time, there are certain crevices that your
cleaner cannot get to, and one of those crevices is the inside of your
computer.

Dust is dangerous
What effect can dust have on computers and electrical equipment? Dust
can have serious effects on our health, from causing asthma and
allergies, to more severe respiratory problems. Like us, our computers
need to breathe. Dust can block filters and prevent air from flowing
through the computer. This makes it act as an insulator, which can add
to the heat build up, thus causing it to overheat.

Dust can also cause
a short in circuit boards and integrated circuits, leading to the
computer crash and in some cases, even catch fire. It can clog up some
of the computer’s moving parts, such as the disk drives and even block
input devices such as USB ports.

There are a number
of ways of eliminating and reducing dust. Protective covers can be used
as a temporary but cheap method of preventing dust particles from
getting into your computer.

However, a more
permanent approach to protecting your computer is to use a specialist
computer enclosure. These enclosures can house your existing computers,
protecting them from dust, but with the added advantage of allowing you
to replace or upgrade your IT whilst still keeping the same enclosures,
which can also protect your equipment from fire and impact. Nothing,
though, beats a routing clean-up of the entire system. Open it up and
have a hand-jet run over it.

While it may not look like much, dust is actually responsible for
hours upon hours of downtime. Protect your computer equipment and you
can sleep easily!

House
of Representatives committee on capital market has denied the content
of its report which indicts the Securities and Exchange Commission.

The
report recommended the reversal of the sack of Ndi Okereke-Onyiuke, the
former director general of the Nigerian Stock Exchange (NSE).

The
preliminary report allegedly indicted the Securities and Exchange
Commission (SEC) for “using a legal means to effect an illegal action”;
it, however, upheld the sack of Aliko Dangote as president of the NSE
Council.

The
report adds, “The condition precedent, as stipulated under sections 13,
35, 47, 48, 49, and 308 of the Investment and Securities Act 2007 and
section 62 of CAMA, were not met.”

Relevant laws

The
committee observed that SEC did not comply with the relevant laws, and
cited the letters, referenced SEC/DG/08/03 of 4th August 2010 and
referenced SEC/DG/08/04 of 5TH August 2010 respectively, entitled,
‘Notice of Removal of the DG of the NSE’ and ‘The Removal from Office
of the DG of the NSE.’ The lawmakers argued that a space of one day
cannot amount in law to sufficient compliance and/or giving a person a
reasonable opportunity of being heard.

However, Lanre Oloyi, the SEC spokesperson, said he is not aware of any report indicting the commission.

“We
have not received any official directive from any quarter. The action
of the commission is in strict compliance with the Investment and
Securities Act, which we have the mandate to implement,” Mr. Oloyi
said.

Umar
Buba Jibril, chairman, House committee on capital market, denied the
contents of the report, adding that the submitted report would have to
be deliberated upon by the entire House.

“I
don’t know where they got it from and I will not comment on that. What
we submitted to the House, we said we wanted to be fair to all
concerned, and that is what we have done so far under the
circumstances,” Mr. Jibril said.

He refused to disclose the committee’s recommendations, but added that whatever the committee submits is not the final decider.

Controversial report

Also,
a game of denial is playing out among parties in the capital market
over the report by KPMG and Aluko Oyebode & Co. which indicted the
sacked NSE DG and some members of her management team. Both the House
of Representatives and SEC, which commissioned the report, said it has
not received any official version of the report.

Mr. Jibril further denied that his committee has received the interim report.

“We
have not seen any report. No report was submitted to the House. We were
in touch with SEC a week and a half ago, and SEC said it has not
received any report.”

Mr.
Oloyi said he is not aware of any report. “I don’t know how it got out.
I am not aware that any report was submitted. Not to my knowledge,” he
said.

SEC,
on August 5, sacked the NSE DG and suspended the president of the
council, Aliko Dangote. Thereafter, the commission appointed an interim
administrator in the person of Emmanuel Ikhazoboh, to oversee the
administration of the Exchange, pending the appointment of a
substantive director general.

Private Moroccan
holding, Saham Group, had bought a controlling stake in insurance firm,
Colina, to create synergies with its Moroccan affiliate, CNIA Saada,
and open access to lucrative African markets.

Saham becomes,
therefore, the first Moroccan firm to expand in Africa’s insurance
sector after a push over the past 10 years by Moroccan banks such as
Attijariwafa Bank and BMCE Bank, to tap more growth abroad.

Saham’s chairman,
Hafid Elalamy, told Reuters his group wants to build up partnerships
with Moroccan banks present in Africa to expand Colina’s business.

South Africa’s rand
moved in a narrow range against the dollar on Monday, leaning to the
weaker side mostly in line with the euro, while stocks closed virtually
unchanged after a similarly lacklustre session.

The rand dipped to
an intra-day low of 7.0190 against the greenback, before coming back to
7.0050 by 1540 GMT, 0.29 percent off Friday’s close at 6.9850.

“The rand weakened
mostly on the back of a slightly weaker euro. There’s still concerns
around this Irish contagion,” Rand Merchant Bank currency trader,
Brigid Taylor, said.

A total of 259.24
million shares, valued at N2.28 billion, were traded in 5,233 deals on
the Nigerian Stock Exchange (NSE) on Monday.

This was against the 385.83 million shares, valued at N4.60 billion, exchanged in 6,317 deals on Friday.

The News Agency of
Nigeria (NAN) reports that weekly transactions on the NSE resumed on a
negative note on Monday, with the indicators sliding by 0.31 percent.

The NSE All-share index lost 79.09 points, while the market capitalisation depreciated by N25 billion.

The index, which opened at 24,959.95, closed at 24,880.86; while the
market capitalisation closed lower at N7.945 trillion, from the N7.970
trillion recorded on Friday.

Was he making
polite conversation, or angling for a share of the voter mind ahead of
next year’s polls? As polite conversation, the comment was hard to
ignore. And as a pitch for votes, difficult to take seriously. Either
way, could the president honestly believe that because of “the
deliberate formulation and deft implementation of policies that ensure
faster return on investment” Nigeria has begun to attract more foreign
investment? Thus, the papers reported the theme of President Goodluck
Jonathan’s speech last week, while receiving the letters of credence of
the new Croatian Ambassador to Nigeria.

Of the three
components of foreign investment, Ivica Tomic (the new ambassador),
would have wondered, of which could the president have been speaking?
Obviously, not investment of the portfolio variety. The recent travails
of equities on the floor of the Nigeria Stock Exchange (NSE); and of
the management of the exchange itself are much too familiar. It would,
therefore, be hard for anyone to think that investment (in an
assortment or range of securities, or other types of investment
vehicles) for the sole-purpose of deriving income (as opposed to
participating in the management of the investee firm under a direct
investment) could be thriving in this country. Besides, most experts on
these matters agree that investment of this type is too flighty to
anchor this economy’s need for funds with which to drive growth on.

Which is why one
promptly dismisses the possibility that the president might have had
bank loans in mind during his welcome address to the Croatian diplomat.
If portfolio investment is flighty, then bank loans are decidedly
anathema. Ask transition and emerging economies in east and central
Europe (Croatia, being one of them) about this. The biggest source of
the transmission of the global financial crisis to those economies was
their considerable exposure to lending from parent banks in advanced
European economies to their local subsidiaries. As soon as the crisis
hit, and bank balance sheets the world over came under pressure, the
parent banks called in these loans, and their subsidiaries went under
water. Now, domestic banks in Nigeria are yet to surface from the
morass after their own experience of the Great Recession. The
president, himself, made a lot about this when he assented to the bill
setting up the Asset Management Corporation of Nigeria (AMCON). So,
without doubt, bank loans, as a source of foreign investment cannot be
trending up, at least, not before AMCON repairs the industry’s balance
sheet.

What about foreign
direct investment? That is, investment by non-resident persons and/or
groups in brick and mortar facilities in this country, in the
expectation of profitable returns over the medium – to long-term. With
rates of return in Europe and North America currently at all time lows,
the hurdle rates for such investments here would not be exceptional.
And anecdotal evidence (from the telecommunications sector for example)
indicate that some of the highest rates of return on investment
anywhere in the world are to be met with here. In part, this is because
costs are high. Each such business must generate its own power, source
for its own water supply, install its own security infrastructure, etc.
All of this bid up the domestic cost of doing business – and add a risk
premium to operating in the country.

In the main,
however, the same reason why public infrastructure is not available in
support of domestic businesses, governance failure, is the biggest
reason for the high average revenue per user figures in the country.
How do we establish where the risk premia for doing business in an
economy such as this stops, and where price gouging starts? In the
absence of competent government, this will remain conjectural.

In spite of all these, could this economy genuinely have attracted
new foreign direct investment, especially when we have fallen down all
the league tables that matter: doing business, Transparency
International, the global budget process ranking, etc.? It gets a lot
more counter-intuitive. Same week as the president was offering his
assurances, an Israeli employee with Solel Boneh, a construction
company, was reported to have paid US$170,000 to kidnappers to secure
his release. Moreover, the Movement for the Emancipation of the Niger
Delta (MEND) threatened simultaneous attacks across oil installations
in the Niger Delta!

The European Union
said on Monday it was giving Mauritius 140 million euros in direct
budgetary assistance for 2011-2013, to help the Indian Ocean island’s
reforms towards becoming a high-growth economy.

Alessandro Mariani,
the EU’s ambassador to Mauritius, said the new grant was a substantial
increase over a previous allocation, which reflected the island’s
performance on reforms of its economy and the sugar sector.

Mauritian sugar
producers have been hit hard after the European Union cut its
guaranteed price for African, Caribbean and Pacific (ACP) sugar by 36
percent. The final tranche of price cuts took effect in October 2009.