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President Goodluck
Jonathan’s recent decision to grant the Bayelsa State government’s
request for exclusive concession of oil derivation on nine offshore
deepwater oil fields, located in water depths beyond 200 metres
isobaths, appears an attempt to exhume the carcass buried more than
eight years ago.

The
Offshore/Onshore Oil Dichotomy Abolition Act (2004) abrogated this as
payment of 13 percent derivation to oil bearing states was applicable
only to crude oil produced in onshore locations (land) as well as
offshore locations within water depths of less than 200 metres isobaths.

The implication was
that revenues earned from oil produced from concessions located in
water depths beyond 200 metres isobaths were not to be subject to the
derivation principle.

Federal versus state governments

The 2001 dispute
between the federal government and the eight littoral states on
derivation formula in sharing offshore revenues cannot be forgotten in
a hurry.

To the federal
government then, the seaward boundary of each of the littoral states
was the low-water mark of the land surface of such state. As such, the
natural resources located within Nigeria’s continental shelf are not
derivable from any of the littoral states, making revenues from such
resources not subject to the derivation formula.

On the other hand,
the littoral states believed that their territory extends beyond the
low-water mark onto the territorial waters, as well as the continental
shelf and the exclusive economic zone (EEZ), and as such all natural
resources derived from both onshore and offshore locations within their
respective territory should be subject to the payment of “not less than
13 percent derivation”, as provided in the proviso to Section 162(2) of
the Constitution.

Dissatisfied, the
federal government went to the Supreme Court asking for “a
determination of the seaward boundary of a littoral state within the
Federal Republic of Nigeria for the purpose of calculating the amount
of revenue accruing to the Federation Account directly from any natural
resources derived from that State pursuant to section 162(2) of the
constitution of the Federal Republic of Nigeria 1999.”

Supreme Court judgment

The Supreme Court,
in its April 2002 judgment, declared that “the seaward boundary of a
littoral state within the Federal Republic of Nigeria for the purpose
of calculating the amount of revenue accruing to the Federation Account
directly from any natural resources derived from that state pursuant to
Section 162(2) of the Constitution of the Federal Republic of Nigeria
1999, is the low-water mark of the land surface thereof, or (if the
case so requires as in the Cross River State with an Archipelago of
Islands) the seaward limits of inland waters within the State.”

Besides, the
Olusegun Obasanjo administration had, in 2003, agreed with all the
littoral states governors that the “200 metres water depth isobaths” be
substituted for “continental shelf and exclusive economic zone.”

This followed
Obasanjo’s proposal that “contiguous zone” be equal to 24 nautical
miles from the coast, against the governors and the National Assembly’s
position that “continental shelf” should equal to 200 nautical miles
from the coast.

The implication of
the agreement was that all the country’s existing producing oil fields
are located within 200 metres water depth isobaths.

In other words,
except for Abo Field, operated by the Nigerian Agip Oil Company (NAOC),
virtually all commercial deep offshore oil concessions are located in
at least 1,000 metres of water depths.

However, the
concession to Bayelsa State government for attribution of nine oil
fields, ostensibly to assuage the “negative impact of the delimitation
of maritime boundaries of littoral states by the National Boundary
Commission (NBC) in the wake of the promulgation of the
Offshore/Onshore Dichotomy Abrogation Act”, appears to be in the breach.

The oil fields
include some of Nigeria’s biggest deep offshore oil concessions, like
the over 770 million barrels reserve Agbami (OPL 216), operated by
Chevron Nigeria Limited, located at about 1,345 metres of water depth;
the over 1.5 billion barrels reserve Bonga (OPL 212), operated by Shell
Nigeria Exploration and Production Company (SNEPCo), at more than 1,000
metres water depths, and the over 630million barrels reserve Akpo (OML
130), operated by Total, at over 1,325 metres water depths.

Others include the
60 million barrels reserve Chota oil field (OPL 220) by ConocoPhillips;
100 million barrels reserve N’Golo (OPL 219) by Elf Petroleum Nigeria;
Nnwa Doro oil field (OPL 218) by Statoil, and Aparo (OPL 213) by
Chevron, all located beyond water depths of 200 metres isobaths.

Allocation politics

What makes the
issues contentious is the significant alteration of the existing
Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) indices
for the payment of oil derivation.

Prior to the
concession and subsequent revision of the volume of oil production
figures attributable to each littoral state, Akwa Ibom topped, with
13,905,432 barrels, followed by Rivers (12,636,795 barrels), Delta
(11,163,493 barrels), with Bayelsa (10,313,368 barrels).

But, the reverse is
the case under the revised indices released since last July, with
Bayelsa State at the first position at 15,995,773 barrels, ahead of
Rivers (13,317,840 barrels), Akwa Ibom (12,796,954 barrels), and Delta
(11,163,493 barrels).

Chairman, House of
Representatives Committee on Rules and Business, Ita Enang, who was
involved in deliberations that gave birth to the Onshore/Offshore
Dichotomy Abolition Act, said in an interview on Friday that the
concession granted Bayelsa State is a clear infringement on the
provisions of that law, as no littoral state is entitled to derivation
on resources located in water depths beyond 200 meters isobaths.

“If the decision is
to be just and equitable, the law must be amended forthwith to extend
the prescribed limits of littoral states approved in the Act,” Mr.
Enang said.

“My conviction has always been that the issue of 200 metres water
depths isobaths was supposed to be the starting point, so that the
onshore/offshore dichotomy would ultimately be abolished completely.
Under such an arrangement, other states, including Akwa Ibom, Delta,
and Lagos, will also benefit,” he said.

Nigerian women
should take up active roles in business, move to relevant positions,
and be the change they want to be, Jesse Jackson, former United States
special envoy for Africa said in Lagos on Thursday.

“Men cannot leave
women at home. We need full partnership. There is nothing women cannot
do. Women are now heading major corporations. What we need now is
business education. If an African American can become the president of
America, then a woman can become the president of Nigeria,” Mr Jackson
added.

He spoke at the 9th Annual conference of the Women in Management and Business (WIMBIZ) with the theme ‘Impact your world’.

WIMBIZ, a
non-profit organisation started in 2001 with a mission to be the
catalyst that elevates the profile of women in management and business.
The organisation just completed the maiden phase of her mentoring
programme as promised, where 72 young women were attached to mentors
for a period of four months in two batches. Its annual conference is a
gathering of women in commerce and corporate Nigeria, attracting
international delegates from different parts of the world.

Nigeria’s structure is problematic

Ben Murray-Bruce,
the chairman, Silverbird Group, and keynote speaker at the event, said
the major problem facing Nigeria is the nation’s political structure.

“The political
structure of the country does not allow talent in any administration,
because of issues such as zoning, ethnic balancing and so on. For
instance, if we have five smart people from Edo state, politically, I
can’t appoint all five of them, so I have one smart guy from Edo state
and four dumb guys from other places. As long as the right talents are
not in government, this is not going to work,” Murray-Bruce said.

Murray Bruce also
said that if you put someone in an environment where there is free
money, “there can’t be creativity, because there is no need to be
creative to earn that money, it is already there. And then the money
needs to be spent, but then, we cannot think and be creative to invest
in technology that is futuristic, because that requires thinking.
Instead, we spend it on a technology that is obsolete.”

People have impacted in my life, and that is why I can also make an
impact in people’s lives. “We may be free, but we have a slave
mentality. In Nigeria today, we may not have to fight for the right to
vote, but we must fight for the right to live. Why can’t we do anything
without bringing someone in from abroad? If our people don’t know how
to do it, why can’t we teach them? You can be somebody if you choose to
be somebody” he said.

Oceanic Bank has
promoted a total of 318 staff in recognition of their outstanding
performance, just as another 136 staff got an increment in their
compensation package to further motivate them.

The bank said the
promotions and salary increments were done to recognise employees who
have performed very well, deploying best practice performance
evaluation method, as is the tradition of the bank to recognise hard
work.

A total of 4,707
staff representing 90 percent of the bank’s staff strength were
appraised, with a view to boosting staff morale and encourage increased
productivity.

John Aboh, the
group managing director of the bank, encouraged the staff to strive for
excellence, as the bank works to entrench a high performance culture.

“The bank’s growth and profitability under the review period has
been underlined by the commitment and collective effort of all staff”,
Mr. Aboh said, stating that the bank has significantly improved
recovery rate, injected fresh, unique customer service, innovative and
best-in-price ideas into the system.

Last week, this
column addressed the issue of consumer promotion, which is to reward
consumer loyalty and sustain brand affinity. In that piece, the
differences between consumer and sales promotion were clearly
identified.

Sales promotion is
a direct inducement that offers extra values and incentives to the
consumer. Its major goal is to maximise sales volume and quicken the
sales process.

It comes through
reduction, discounts, commissions, and free sampling. It is an activity
that appeals more to the consumer’s purse, to make immediate purchase
decision of a specific brand.

Since it generates
sales that cannot be achieved by other means, it is important for brand
custodians to evolve a strategic action plan that deepens relationship
with the consumers. This is important because I have discovered
overtime that some companies embark on sales promotion without any
relationship with the consumer. I will give an example to illustrate.

I am a customer of
a highbrow fashion outlet, though I must state here that the outlet has
a good data base of customers, but it all ends there. My other details
such as birthdays, wedding anniversary, and others should have been
documented as well.

My case here is
that it should not only be during sales promotion that I receive text
messages. Sales promotion should be a coherent branding strategy that
is hinged on a beneficial relationship with the consumers. This way,
brand loyalty is sustained. When all these happen, sale promotion would
definitely achieve desired objectives, as the brand becomes the
property of the consumer.

Sales promotion and consumer insights

While it is true
that not all consumers can be captured, a sampling method could be
adopted which can represent the views of an average consumer.

The role of
consumer insights here is to generate leads that can make the sale
promotion succeed. Some of the key insights are to ask probing
questions about consumer preference in terms of incentives, the nature
of the promotion, timing, and brand perception. All these go a long way
to make the sales promotion succeed.

This is because
today’s consumers are more concerned about an offer or extra incentives
given by the brand, and not only a brand promise. The sales promotion
activity should build customer equity, deliver worthwhile experiences,
and deepen relationships. It is indeed a call to action to connect
directly with consumers.

The incentive in
any sales promotion should be one that would motivate the consumers,
who should derive maximum benefits. They feel the burden in their
purses and this should translate to enormous gains for them. They
should gain extra value for what they have invested in – the brand.

The issue of
negative perception should also be addressed right from inception of
the sales promotion. An error can occur along the line and this may not
be deliberate on the part of the company. It becomes important to put a
mechanism in place to proffer immediate response in order to avoid
negative perception. Several brands have been negatively projected due
to the lack of a pro-active communication.

Sales promotion
offers a veritable platform to build brand image and as a result, a lot
needs to be ensured to eliminate any form of negative perception. It is
also not a period to offer expired products for sale. Consumers have
been ripped off through such acts and that is why the Consumer Advocate
Forum has taken up the gauntlet to checkmate these act.

Any brand that
fails to live up to its promise will be dismissed and destroyed. The
only way to engage in genuine bonding and connection with consumers is
to develop long term relationship built on trust, respect, and mutual
benefit. Sales promotion is that springboard to build an enduring
relationship with consumers.

A new fellow of APCON

Tunji Olugbodi, a
versatile professional, is set to become a Fellow of the Advertising
Practitioners Council of Nigeria (APCON). Mr. Olugbodi is a credible
brand in the industry and one of the few professionals with integrity,
who practices according to the rules. Surely, he deserves the honour,
as he stands tall as a professional to the core. He has put in over two
decades in the marketing communications industry.

He started his own
agency, Verdant Zeal, in 2007, after 15 years with Prima Garnet Ogilvy,
where he was a factor in its success story, rising to become executive
director (brand management).

Congratulations to a worthy senior colleague and a professional par excellence.

Ayopo, a public relations specialist is the CEO of Shortlist Limited shortlistprspecialists@gmail.com

In
a move to check currency speculation, the Central Bank of Nigeria (CBN)
has withdrawn the licences of the 50 Class A Bureau de Change (BDCs)
operating in the country.

A statement posted
on its website on Wednesday, and signed by Mohammed Abdullahi, the CBN
head of corporate communications, said the withdrawal, which takes
effect on November 8, is part of measures to stem the gross abuses of
the enhanced Class ‘A’ BDC, in line with its avowed commitment to
eradicate money laundering.

The Class ‘A’ BDCs,
whose licences have been withdrawn, are free to apply for Class ‘B’
licence, with the attendant privileges, by fulfilling the stipulated
licencing requirements, says the Central Bank.

“The CBN shall also, within 30 days, refund all mandatory caution deposits lodged with the Bank,” the statement added.

The Central Bank
had on February 26, 2009, restructured BDCs into categories A and B, in
order to further liberalise the foreign exchange market and enhance its
efficiency. The main objective was to facilitate end-user access to
foreign exchange supply from official sources in order to boost
economic growth by promoting productive efficiency of small and medium
scale enterprises.

Such BDCs were
expected to have a minimum capital of N500 million verifiable at all
times, a mandatory deposit of $200,000, non- interest bearing,
non-refundable application fee of N100, 000, licencing fee of N1
million, and annual renewal fee of N250,000.

Gross abuse

The CBN statement
said that the latest appraisal of the policy initiative has revealed
gross abuses of the enhanced official funding of the Class A category
of the BDCs and the negation of the expected benefits to the economy.

“Available
information also revealed that the target end-users have been
sidelined, while large transactions that should have been channelled
through the banking system have been carried out through Class ‘A’
BDCs,” the statement said.

The CBN said it has
also been inundated with complaints from foreign countries that some
Nigerian travellers indulge in cross-border transportation of large
sums of foreign currency in cash.

“Indeed, returns
from the Nigerian Customs Services on foreign currency declaration by
travellers show that large amounts, up to $3million cash, have been
taken out of the country by individuals in single trips.”

These, according to
the CBN, are worrisome developments that negate the expected benefits
from further liberalisation of the foreign exchange market.

Incidentally, the
CBN had said that the failure to fully comply with the anti-money
laundering law, among other laws and regulations and checking leakages
in the system, as reasons for classifying BDCs last year.

When Fitch Ratings,
one of the world’s better-known Credit Rating Agencies (CRAs), was
reported in the papers last week as having downgraded its outlook on
the Nigerian economy, my initial reaction was “So what?” A negative
credit warning should increase the price of the country’s sovereign
risk. But how to measure this in the absence of a sovereign debt
instrument?

Besides, the credit
rating function is the most damaged franchise to have come out of the
recent global crisis. Indeed, after Greece nearly succumbed to the
market’s panic over the sustainability of its near-term fiscal outlook,
and the deluge of sovereign rating downgrades that followed the
European sovereign debt crisis, the big question has been over the
accuracy of the CRAs’ credit risk assessments.

One of the most
important recent contributions to the debate over the continued
relevance of credit ratings, the IMF’s Global Financial Stability
Report (GFSR) for October 2010, finds the key strength of the CRAs in
their ability to “provide information, monitoring, and certification
services.”

This way, the CRAs
even out the information asymmetries between debt issuers and
investors, provide (through their rating downgrades) continuous
assessments of these securities, and because most countries insist on
credit ratings as part of most financial contracts, they also provide
an assurance function.

Consequently,
countries cannot readily and cheaply “access global capital markets and
attract foreign investment”, if they have not been rated first. Few
investors will touch fixed-income securities that do not have credit
ratings.

And it would seem
that the originate-to-distribute model of bank lending (which replaced
the traditional originate-and-hold variety, and which has been
described as complicit in the underestimation of risk that aggravated
the current financial crisis) could not have happened if the CRAs did
not start lending their imprimaturs to structured products.

Did these functions
also destabilise financial markets? How much of the impact of the
sovereign debt crisis in Europe was because holders of some countries
debt instruments felt pressured by adverse credit rating news in other
countries to demand stricter repayment covenants?

The IMF concludes
that “CRAs do have an impact on the funding costs of issuers and
consequently their actions can be a financial stability issue.”
Accordingly, the GFSR October 2010 recommends, amongst others, for
policy-makers to redouble efforts at reducing “their own reliance on
credit ratings, and wherever possible (removing) or (replacing)
references to ratings in laws and regulations, and in central bank
collateral policies.”

The Fund also
counselled regulators to strengthen their supervision of CRAs if they
had to use the latter’s ratings for their regulations.

Significantly, the
Fund also found that the informational value of sovereign ratings
occurs not through “actual rating changes,” but because of “outlooks”,
“reviews” and “watches”, which show the possible future trajectory “and
timing of future rating actions.”

On this count, the
response of the Nigerian authorities to Fitch’s review was risible.
Splitting hairs over whether this was a rating or an outlook downgrade
doesn’t quite make the grade. The point is that according to the IMF,
“CRAs use a negative ‘outlook’ notification to indicate the potential
for a downgrade within the next two years (one year in the case of
speculative-grade credits)”. And that between June 26, 1989 and March
31, 2010, the 212 negative outlooks published by one of the leading
CRAs were followed by 118 downgrades within an average of six months.

So, the possibility
of a rating downgrade is high, if over the near-term, government fails
to address the public expenditure management framework in a way that
significantly assuages public concerns.

For, it is not only
the rating agencies that are concerned at the rapid decline of the
country’s foreign reserves, even as demand pressure continues to mount
in the foreign exchange markets; or the country’s rising external debt,
in the face of constricting domestic capacity use. Government may be
persuaded of the usefulness of its planned reforms: proposed
establishment of a Sovereign Wealth Fund (SWF); and its intent to
address the infrastructure deficit in the power sector.

The truth, though,
is a wee bit different: in the absence of sustained and identifiable
welfare gains from government’s sundry activities, the electorate does
not care (nor can it subsist) on the ideas (for reform) that reside in
their leaders’ heads.

In the midst of dwindling earnings, banks are cutting down on
their cost of doing business in order to remain profitable. As a result,
despite recording significant drop in their earnings, many banks still managed
to post significant rise in profit as seen in recent results.

For most banks, while gross earnings dropped, profit before tax
rose due to what analysts at Afrinvest, a financial research firm, refers to in
Zenith Bank’s case as “improvement across the bank’s key efficiency and
operating ratios.” Despite a 13.6 per cent drop in gross earnings, the
institution posted a profit before tax of 196.3 per cent.

In its update for the
bank’s third quarter result released on October 27, Afrinvest noted that
“continuous improvement across the bank’s key efficiency and operating ratios
has fuelled this performance even as top-line growth continues to come under
intense pressure.” A similar scenario played out in First City Monument Bank
(FCMB) as gross earnings dropped by 19.02 per cent from N55.02 billion to
N44.55 billion. Interest expense however when down from N21.8 billion to N16.7
billion while profit before tax rose by nearly 2000 per cent from N298.13
million to over N6.1 billion.

For Sterling Bank, while gross earnings declined by 13 per cent
from N26.6 billion in September 2009 to N23.1 billion in the corresponding
period in 2010, profit after tax rose to N5.3 billion from a loss of N6.2
billion last year.

The bank attributes this significant increase in profit to
efficiency and cutting down on its cost of doing business. Thus, funding costs
declined 38 per cent to N8.1 billion from N13.0 billion. “Sterling Bank
emphasis on efficiency and profitability has been the cornerstone of its
performance in the third quarter. Discretionary costs have been kept in tight
check and new processes brought on stream at the beginning of the year continue
to show expected results”, said the bank’s executive director, Lanre Adesanya.

Common experience across
board

Access Bank’s third quarter results showed that gross earnings
declined by 15.2 per cent from N91.93 billion to N77.95 billion. From a loss
position of N10.64 billion in the third quarter of last year to a profit before
tax of N14.06 billion this year.

Aigboje Aig-Imoukhuede, Access bank group managing director,
said the bank has achieved significant growth in its deposit base with a 24 per
cent increase in customer deposits quarter on quarter as it continues to
benefit from the continuing success and effectiveness of its value chain
strategy. “With our focus on maintaining a high quality service-centered
business model supported by a robust enterprise risk management framework, the
bank is well positioned to deliver a strong full year performance in line with
the positive results achieved year to date,” Mr Aig-Imoukhuded said.

First Bank also posted a gross earnings of N177.1billion, an 11
per cent drop over the N197.9 billion posted last year.

However, profit before tax rose to N40.7 billion from a loss of N6.6 billion
posted last year. Guaranty Trust Bank similarly showed an 11.9 per cent drop in
third quarter earnings from N136.1 billion to N119.8 billion, while pretax
profit rose significantly by 82.1 per cent from N21.4 billion to N39 billion.

The value of equities at the Nigerian Stock Exchange (NSE)
depreciated further on Wednesday after closing negatively on Tuesday.

The NSE market capitalisation closed yesterday at N7.913
trillion from Tuesday’s figures of N7.920 trillion, reflecting N7 billion
losses or 0.08 per cent decrease. The market had lost N92 billion or 1.14 per cent
on Tuesday.

The All-Share Index also lost 0.08 per cent or 21.32 units on
Wednesday, down from 24,804.22 basis points to close at 24,782.90. The NSE
sectoral indexes recorded negative performance on Wednesday as the NSE-30
Index, which measures activities of blue chips in the market, dropped by 0.21
per cent.

The NSE Banking shed the highest points by 0.26 per cent; the
Food/Beverages plunged by 0.12 per cent, followed by the NSE Oil & Gas
which declined by 0.18 per cent, while the Insurance, the only gainer, went up
by 0.30 per cent.

Equity Analysts at Resource Cap, an investment advisory firm,
attributed “profit taking activities by investors” to the downturn, adding that
“sell pressures may continue across the sectors on the bourse.”

Low volume

At the close of Wednesday’s trading, a total of 253.22 million
shares valued at N1.930 billion were traded in 6,200 deals as against the
277.00 million shares worth N2.658 billion exchanged in 5,711 deals on Tuesday.
The banking subsector maintained its lead on the most active subsector chart
yesterday with 140.05 million units valued at N1.14 billion.

The volume recorded in the sector was driven by transaction in
the shares of Zenith Bank, United Bank and Access Bank. The Insurance subsector
followed, trading 26.047 million shares valued at N21.843 million. Transactions
in the subsector were largely driven by the shares of Aiico Insurance, NEM
Insurance and Lasaco Assurance.

The Mortgage companies subsector came third with investors
trading 26.032 million shares valued at N14.669 million. Investors in Resort
Savings & Loans, Union Homes Savings & Loans and Aso Savings &
Loans enhanced activities in the subsectors in terms of volume.

More gainers

The prices of 29 equities appreciated in value on Wednesday
while 20 depreciated. Okomu Oil led the price gainers, appreciating by 70 kobo
to close at N14.95 per share. Oando gained 70 kobo to close at N64.00 per share
while University Press grew by 29 kobo to close at N6.28 per share. African
Petroleum topped the price losers’ chart, depreciating by N1.31 to close at
N24.94 per share.

Ashaka Cement shed 91 kobo to close at N22.66 per share while
Ecobank Transnational Corporation lost 74 kobo to close at N15.26 per share.
Meanwhile, a total of 12 companies released their financial results at the NSE
floor on Wednesday.

Fidelity Bank, in its third quarter report, recorded a profit
after tax growth of 85.97 per cent. Nigerian Bottling Company third quarter
result shows a turnover growth of 14.06 per cent and profit after tax growth of
30.21 per cent.

The Nigerian Content Development and Monitoring Board says it is
determined to enforce provisions of the Nigerian Content Act for indigenous and
international oil companies operating in the country.

Ernest Nwapa, its executive secretary, said Monday, in Abuja, at
the 14th International Health, Safety and Environment (HSE) Biennial Conference
on the oil and gas industry in Nigeria, that this is part of government’s
imperative to realise the Nigerian content development agenda.

Mr. Nwapa said until 2004, there was very low local capacity in
Nigeria’s petroleum industry, with about 95 percent of goods and services
imported, while the introduction of the Nigerian Content Policy has improved
local capacity to about 35 percent.

He said government agenda is to identify and close all capacity
gap business opportunities in dry dock integration, shipyards, heavy
industries, pipe mills, equipment manufacturing, and service companies’
training in the industry.

Part of government’s expected impact on the national Gross
Domestic Product (GDP) in the next four years, the NCDMB scribe said, is to
ensure that at least $10 billion of an average annual petroleum industry
expenditure of $20 billion is retained within the local economy, while about
30,000 direct employment and training opportunities are domiciled in Nigeria
through the implementation of the policy.

To ensure that capacity building projects are not stifled by
lack of funding, he said government has launched the Nigerian Content
Development Fund (NCDF), a central pool of financing, in collaboration with the
Central Bank of Nigeria (CBN) and commercial banks, for certified beneficiaries.

Cost effectiveness

“Local capacity building will improve cost effectiveness and
certainty of supply by reversing the trend of 100,000 jobs currently created
abroad by the international oil companies, through the continued outsourcing of
service contracts to companies outside the country,” he said.

“Henceforth, government, through the provisions of the NCD Act,
would ensure that no other vessel is allowed to work if a vessel owned by a
Nigerian working in the nation’s oil and gas industry is not put to work first.
Any equipment working in Nigeria must be partly-owned by a Nigerian before it
is allowed to work.

“This is the only way to reverse the current practice where nine
out of 10 cents paid for equipment in the industry are not domiciled in
Nigeria,” he said.

However, John Mpi, manager, business development, Nigerian Agip
Oil Company (NAOC), however, expressed skepticism over the policy prospects, if
government does not pay serious attention to human capacity development issues.

Mr. Mpi said it is sad that the industry has nothing significant
to show for its 50 years of existence, saying there is need for the indigenous
companies to model their operations after the successful international oil
companies, in terms of setting key performance indicators to measure their
success and growth as well as strict supervision.

E-commerce, if given the right framework and infrastructure, has
the potential of aiding African countries and expanding the horizons of their
trading to a competitive level in the global village.

This was the consensus on Tuesday at the Kuramo Conference, an
international colloquium on trade, law, and economic development held in Lagos.

The conference participants agreed that with the right framework
and strategy, Africa can make a difference in her economic and trade climate if
she fully explored the benefits of e-commerce.

E-commerce is the buying and selling of products or services
over the Internet and other modes of computer networks.

Enver Daniels, the chief state legal adviser, South Africa, said
e-commerce has the potential to expand horizons of the African market.

Tackle infrastructural
challenge

However, for e-commerce to be successful, African countries must
address the attendant infrastructural challenges. Mr. Daniels said countries
must take up the responsibility of developing infrastructure locally, for trade
between countries to be successful.

“For instance, if you order for an item or items online from
Ghana, Ghana must have the right infrastructure in place that would aid the
movement of such orders to their destination, within the shortest time, and
Nigeria must in turn have the appropriate infrastructure to receive such
goods,” he said.

He added that countries must also develop their human capital,
adding that one of the major reasons militating against e-commerce success is
the lack of understanding of its attendant benefits.

Governor Babatunde Fashola of Lagos State said legislation must
also remove barriers to trade.

“A new legal order is now needed. There is the need to examine
the existing legal order for trade and commerce among nations,” Mr. Fashola
said.

He also challenged participants to set the agenda “here and now,
as regards the mechanism for a fair global regime.”

Emmanuel Ayoola, a retired Supreme Court justice and the
conference chairman, said it was a platform for the restoration of a nation,
and not another talk shop.

“It is a forum to define the path of a new national vision,
deploying application of knowledge and experience drawn from multifarious
disciplines as tools.

“It is the platform to launch the new order that is shaped by
right thinking, right values, right ideas and palpable commitment,” Mr. Ayoola
said.