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Economy and Business

Petrol Subsidy To Remain Till Mid-2023 – FG

Ahead of the 2023 budget presentation, the Federal Government on Monday reiterated petrol subsidy will remain in place until mid-2023.

According to the Minister of Finance, Zainab Ahmed, the government is proposing to spend only N3.36 trillion for petrol subsidy in 2023.

She made the comment while meeting with the House of Representatives Committee on Finance in Abuja on the details of the 2023-2025 Medium-Term Expenditure Framework and Fiscal Strategy Paper.

The minister added that the Federal Government is proposing an aggregate expenditure of N19.76 trillion for the 2023 financial year, with a projected deficit of N11.30 trillion.

According to Mrs Zainab, the Federal Government is projecting the total revenue of N8.46 trillion, out of which N1.9 trillion is expected to come from oil-related sources while the remaining is to come from non-oil sources.

Meanwhile, the Federal Government is expected to peg crude oil price at $70 per barrel at an exchange rate of N435.57 per dollar, while real Gross Domestic Product (GDP) is projected at 3.7 percent and inflation at 17 to 16 percent.

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How to report your bank when displeased – CBN

The Central Bank of Nigeria has released a guide for bank customers and others on how and where they can lodge complaints against financial institutions regulated by it.

The financial institutions include commercial banks, microfinance banks, primary mortgage institutions, and discount houses.

The CBN noted that it had earlier issued a circular directing all banks to expand their existing ATM help desks to handle all types of consumer complaints.

“Therefore, if you have a complaint against your bank, you must first report the complaint at the bank/branch where the issue originated and then allow two weeks (it might be less or more in some cases) for the issues to be resolved,” it said.

According to the apex bank, the customer has the right to escalate the complaint to the Director, Consumer Protection Department of the CBN after lodging a complaint, when the bank fails to acknowledge within three days or issue a tracking number, or fails to resolve the complaint within the timelines as stipulated by the Consumer Protection Regulation.

The CBN said, “You can only direct your complaints to CPD upon the failure of your bank/financial institution to resolve your complaint within the timeline stipulated by the Consumer Protection Regulation.

“You can contact the CPD through the following channels: Consumer Protection Department, Garki, Abuja. Your letter of complaint should be addressed to the Director, Consumer Protection Department. You can submit your letter at the CBN Head Office or at any of the CBN branches nationwide.”

 

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Obi Cubana, Abba Kyari, others attend wedding of IGP’s son

The embattled former head of the Nigeria Police Force’s Intelligence Response Team, Abba Kyari; and a popular socialite, Obinna Iyiegbu, better known as Obi Cubana, were some of the guests that attended the wedding of Maina Alkali, the son of the incumbent Inspector-General of Police, Alkali Baba.

The wedding which took place at the palace of the Shehu of Borno, Abubakar El-Kanemi, in Maiduguri, the capital of Borno State, on Saturday, was also attended by the governor of the state, Babagana Zulum; and his counterparts from Yobe and Jigawa State—Mai Mala Buni and Badaru Abubakar respectively.

Other guests included the Senate President, Ahmad Lawan; a former governor of Borno, Kashim Shettima; Minister of Aviation, Hadi Sirika; billionaire businessman, Aliko Dangote; Managing Director and Chief Executive Officer of Tiamin Rice, Aminu Ahmed.

Recall that because of his association with an alleged fraudster, Ramon Abass, aka Hushpuppi, and his subsequent indictment by the United States of America’s Federal Bureau of Investigation, Kyari was suspended from office. One of the major criticisms he faced at the time was because of his perceived closeness with certain personalities such as Obi Cubana.

 

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$197m 5G mock auction holds Friday, rollout begins 2022 in 12 states

The Nigerian Communications Commission has said Nigeria’s 5G plan will allow efficient allocation of spectrum for 5G deployment, and ensure its effective deployment in major urban cities by 2025.

The commission also disclosed that the much anticipated mock auction of the 5G spectrum for qualified telecommunication companies would hold on Friday, in preparation for the main auction scheduled for Monday December 13, 2021.

These were disclosed by the Executive Vice Chairman/Chief Executive Officer, NCC, Prof. Umar Danbatta, at a capacity building workshop themed, ‘5G Deployment and the Next Level of Nigeria’s Development’, organised by the commission in Kano on Tuesday.

He said, “It is expected that the roll-out of the 5G will be carried out in phases beginning with major cities in the country where there is a need for high-quality broadband.”

According to him, the commission will carry out its mock auction of the 5G in on Friday, December 10, 2021, adding that this will be preparation for the main auction, scheduled to hold on Monday December 13, 2021, in Abuja.

He said, “It is expected that the two slots to be auctioned will be picked up by successful bidders at the end of the auction on Monday, December 13, and following that, the stage will be set for the next phase of 5G roll-out commencing in 2022.”

According to the commission’s ‘Information Memorandum on 3.5 GHz Spectrum Auction’, about 12 states will enjoy 5G services within 2022 and 2023.

The NCC said, “Year One to Two starting from the effective date of the licence. Rollout service in at least two states in each geo-political zone: South-West, South-South, South-East, North-Central (Including the Federal Capital Territory), North-West and North-East.

“Year Three to Five, additional six states other than those in Year One to Two, across the six geo-political zones. Year Six to 10, operators are encouraged to roll out across all other States.”

According to the NCC, it may be until 2028 and 2032 before every region of Nigeria enjoys 5G services.

Meanwhile, the United States Ambassador to Nigeria, Mary Beth Leonard, has cautioned the Federal Government against engaging high-risk telecommunications suppliers to participate in or control any part of the fifth-generation network.

Leonard gave this warning on Tuesday, at the 2021 International Legislative-Stakeholders’ Conference on Digital Technology and Cybersecurity organised by the Senate Committee on ICT and Cybercrime alongside the National Information Technology Development Agency.

She said, ““This is a particularly timely issue for Nigeria, as Nigeria prepares for next week’s 5G spectrum auction and looks to roll out Nigeria’s 5G networks after the New Year. We believe it is essential that governments, telecom operators, and network users prioritize security when building out their 5G networks.

“National measures must be crafted to mitigate significant security risks from high-risk suppliers regardless of national origin by precluding such suppliers from providing equipment software and services to 5G network infrastructure.

The Director-General, NITDA, Mr Kashifu Inuwa, says that Nigerian is ranked 35th in the world for online business.

Also speaking, Nigeria’s Senate President, Ahmed Lawan, who was represented by Senator Hassan Hadejia, raised concerns over the spate of insecurity in cyberspace, stating that there was an urgent need to protect the nation from the dangers it portends.

 

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The tech helping shops – and Santa – deliver this Christmas

With December now upon us, bear a thought for just how busy Santa Claus will be on the night of Christmas Eve, and in the early hours of Christmas Day.

Every year he faces a logistics puzzle – how to deliver all the presents to all the children around the world who celebrate Christmas.

A study from a few years ago puts some figures on just how frantic his night is. Researchers at the University of Leicester calculated that there are some 715 million Christian boys and girls across the globe.

They then assumed an average of three children per household, which means that Father Christmas has to deliver to 238 million homes. This, in turn, requires Rudolf and the other reindeer to pull Santa’s sleigh at half the speed of light. That’s 336 billion mph (540 billion km/ph).

While Father Christmas is no doubt continuing his final preparations and limbering up, Christmas is, of course, also the busiest time of the year for retailers – none of us can sadly rely solely upon presents that are magically delivered via our chimneys.

And with online orders now accounting for more than a third of all Christmas season sales, retailers have to focus intently on their delivery systems.

The behemoth in the industry is Amazon, which throughout last year delivered 4.2 billion parcels in the US alone.

That was more than double its 1.9 billion total in 2019, as coronavirus fuelled a vast surge in online orders. So much so, that last year Amazon delivered one in five parcels in the US.

It is a similar picture in the UK, where Amazon’s sales rose by 51% in 2020.

Such is the convenience of Amazon that many of us now automatically expect things like next-day delivery, and being able to track orders.

For other retailers, large and small, this poses a problem – how can they make their delivery systems as efficient and user friendly as possible?

One option is to become a third-party seller on Amazon, but that comes with a number of fees. These typically total 15% of the price of items, but reportedly can equate to as much as 45%.

Alternatively, retailers can stay independent of Amazon, and instead use the services of a number of tech firms who can help them best get their products to customers.

One such business is UK firm Diamond Logistics, run by founder Kate Lester.

Via its Despatch Lab digital platform it allows retailers to book, track and manage deliveries using the company’s own fleet of vans, but also via the Royal Mail, and delivery firms such as DPD and Hermes. Retailers can also arrange to store their products at Diamond Logistics’ warehouses, from where they are then directly sent out.

Ms Lester says its revenues have soared by 50% this year, as more and more shops ramp up their online presence.

“We have 30 local fulfilment centre,” she says. “So we can store it, pick it, pack it and despatch it.

“Retailers have got a pretty stark choice – really you either put your stuff into Amazon, and it becomes a cost-comparison thing. That is really what Amazon is all about…or you retain control of your logistics, and outsource it to someone [like us].”

An alternative for retailers is for them to use their own fleet of delivery vans. To enable firms to keep tabs on their delivery drivers and plan routes, US firm HyperTrack offers an app and GPS-based tracking system.

The company’s vice president of sales, Francois Martel, says the system allows both retailers and wholesalers to give customers more accurate delivery times.

“Imagine you are a retailer, and are ordering from a wholesaler,” he says. “Wholesalers don’t have that same Amazon-like technology, and yet they want it to provide a reliable delivery time window that is not 8-4.

“The windows can be so large at the moment they are laughable, so using us to provide tighter windows, and holding to that time, is changing the experience in a significant way.”

For Norwegian firm, Gelato (despite the name it has nothing to do with ice cream), its big idea is to help firms take the distance out of deliveries.

Its software allows e-commerce sellers of physical products such as clothing, posters and books to connect with manufacturers around the world.

For example, if a British designer of patterned t-shirts gets an order from Australia, rather than posting the item from the UK, it can get the item of clothing printed and delivered by an Australian firm.

Henrik Müller-Hansen, the founder and chief executive of Gelato, says that there are not just huge environmental benefits. “What local production and on demand production allows you to do is to reduce the distribution distances, but also to match supply and demand,” he says.

“You no longer have to guess. In the old days, in order to reach economies of scale, you sat there as a big global manufacturing company and tried to assess demand. Now, with on-demand local production, you produce when you receive the order.”

Mr Müller-Hansen expects his business to grow alongside developments in 3D printing, which will enable more products to be easily manufactured remotely.

However, perhaps the most exciting development in delivery technology – and especially for Santa Claus – is cargo-carrying drones. (Tens of millions of them would really help him out on Christmas Eve.)

Yet, while the technology already exists, it is still waiting for regulatory approval by governments to start national commercial use.

Instead, there are currently a number of pilot schemes around the world. Naturally Amazon has its own project – Prime Air – but a number of smaller firms have also developed their own drones.

One such company is Israeli-company Flytrex, which is already enabling restaurants in the North Carolina town of Holy Springs to deliver their food via its drones. It is part of a trial authorised by the US Federal Aviation Administration.

In the future drones may mean that you can order all your Christmas presents on 24 December, and get them delivered that afternoon.

But in the meantime, Kate Lester says it is best to order your presents early. “Get your orders in soon, because it will be fatal to leave it until 21 December to do it this year. Because I think this December is going to be chaos [busy].”

Unless of course you leave it all for Father Christmas to handle.

Additional reporting by New Tech Economy series editor Will Smale.

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Glo missing as NCC qualifies MTN, Airtel, new firm for 5G auction

Globacom and Emerging Markets Telecommunication Service Limited are set to miss out on the deployment of Fifth Generation network for at least two years as the Nigerian Communications Commission qualifies MTN Nigeria Plc, Airtel Networks Limited and one new player for its 5G auction.

The NCC announced on Thursday only three qualified bidders met its criteria for the licensing process for the 3.5 gigahertz spectrum which is required for 5G deployment.

These three companies paid at least $19.74m each in order to qualify, it was learnt.

In a statement, the commission said, “The qualified bidders that have met the criteria for participation in the licensing process of 3.5Ghz spectrum, including payment of the stipulated Intention to Bid Deposit as outlined in the Information Memorandum, are MTN Nigeria Plc, Mafab Communications Limited, and Airtel Networks Limited.”

According to the document released by the Federal Government, “Applicants must transfer an IBD corresponding to a lot into the designated account in cleared funds not later than 17.00 hours West African Time on November 24, 2021.

“A bank guarantee, or similar instruments, will not be acceptable. This deposit will bind the applicant to take up a licence, should it be a successful bidder, at the reserve price or any higher bid value submitted during the process.”

The commission pegged the IBD at 10 per cent of the reserve price for the spectrum ($197.40m).

NCC official, who spoke on condition of anonymity because he was not authorised to speak on the matter said Glo and 9mobile did not submit any application to partake in the process.

The commission said, “At the close of the bid submission date of November 29, 2021, three companies, namely MTN Nigeria, Mafab Communications Limited and Airtel Networks Limited had successfully submitted their bids in line with the requirements of the IM.”

According to the NCC, only the three companies would participate in the main auction as well as in the mandatory mock auction process set to hold in December 2021.

In the IM, the commission had earlier disclosed that it was only offering two lots of 100 MHz TDD Spectrum in the 3.5 GHz band ranging from 3500 – 3600 MHz and 3700 – 3800 MHz for auction.

This implies only two of the three companies would emerge with capability to offer 5G services after the auction.

During a 5G stakeholder meeting in Lagos, the NCC disclosed that it would make three more lots available for auction in 24 months after most of the telecommunication companies questioned the commission for making only two lots available.

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The World Ahead 2022: People like working from home, Bosses want them back in the office

The lockdowns of 2020 represented an unprecedented shock to office life. Overnight, companies the world over were forced into a giant experiment in working from home (wfh) that few firms would ever have dared try of their own volition. At the peak in the spring of 2020, some 60% of total working hours in America were conducted from people’s living rooms, kitchens and, for the lucky few, home offices. The results of this experiment are in, and they suggest that many of these novel working practices will endure. And for the better.

 

For workers, the great wfh experiment has gone fairly well. Adjusting to the new regime was not easy for everyone—especially those living in small flats, or with children to home-school. Yet on average workers report higher levels of satisfaction and happiness. Respondents to surveys suggest that they would like to work from home nearly 50% of the time, up from 5% before the pandemic, with the remainder in the office. But people’s actual behaviour suggests that their true preference is to spend even more time in their pyjamas. How else to explain why, even in places where the threat from covid-19 is low, offices are only a third full?

 

Few managers seem keen on so much remote working. According to a survey by three economists, José Maria Barrero, Nick Bloom and Steven Davis, firms expect that around a quarter of all work hours will be done from home in a post-covid world—about half what workers want. These harder-nosed preferences in part reflect a perception that too much time out of the office is bad for productivity and company culture. Certainly some evidence suggests that working from home full-time can make people less efficient.

 

Yet there is less disagreement on the benefits of a “hybrid” approach. Research suggests that a mixture of home and office work can actually be the best arrangement for productivity. It enables a more efficient division of labour between “deep work” (the sort requiring lots of concentration, which may be best done at home) and collaborative work (best done with colleagues, in person, in the office). Setting aside some afternoons for in-person drinks or awaydays also helps maintain company culture.

 

Firms have other incentives to offer hybrid work, beyond mere efficiency. Some recognise its importance in the fight to retain talent. Even the most prestigious investment banks, which until now have stressed the benefits of the office, are soon likely to have people jumping ship if they do not become more flexible.

 

The shift to hybrid work will have big effects. One is that managers will require different skills. Rather than hiring and promoting charismatic leaders, companies may place more emphasis on managers who are good at using digital tools to specify exactly what they want doing, and when, to distributed teams. Another is that firms, and work itself, will become more digital.

 

There are already signs that the move to hybrid working is paying off. During the pandemic people’s views of their firms’ culture became more favourable, suggest data from Glassdoor, a website that lets workers rate employers. Surveys by Gallup, a pollster, find that employee “engagement” in America, a rough measure of how committed people are to their jobs, is near an all-time high. In part this reflects a sense of solidarity with colleagues and managers. But it also reflects a genuine improvement in working conditions.

 

Further changes are on the way in 2022. Many firms realise that they need to do more to encourage people to come into the office. That means investing in perks such as fitness centres and good food. And governments are waking up to the fact that employment law needs to evolve, to recognise and protect home-workers.

 

The wfh experiment has a sting in the tail, however. Not everyone can benefit from it. Even in rich countries a majority of the workforce must be physically present in order to do their jobs. Long before the pandemic a gap was emerging between well-paid, intellectually stimulated workers on the one hand, and poorly paid service workers on the other. The rise of working from home deepens the split between these two types of people—with consequences that no one can predict.

 

Callum Williams: Senior economics writer, The Economist, San Francisco■

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Naira loses steam, slides to 555/dollar in parallel market

The naira lost steam at the parallel market on Monday, sliding to 555 per dollar.

The local currency had crashed to 540/dollar on Friday, after trading at 535/dollar on Thursday.

After tumbling to 575/dollar recently, the local currency began a gradual uptick in recent weeks peaking at 530/dollar last week.

Operators in the parallel market, who spoke to our correspondent on Monday, said the local currency was bought and sold at 550/dollar and 555/dollar respectively.

An operator in the black market attributed the fall to an increase in demand for the greenback.

At the Central Bank of Nigeria’s Investor & Exporter Window, the naira fell by 0.16 per cent to close at 415.07/dollar after reaching a new high of N445.75.

The CBN however maintained 411.63/dollar as the official rate on its website.

According to local currency traders, lack of adequate liquidity in the retail end of the market is responsible for the naira crash.

“It is a sign we need to meet the demand for dollar in the market, this constitutes a major conflict in activities in the market,” a local operator who chose to speak on condition of anonymity, said.

 

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eNaira may reduce deposits in commercial banks, IMF warns CBN

The International Monetary Fund has said the eNaira wallet may function as a deposit at the Central Bank of Nigeria and consequently reduce demand for deposits in commercial banks.

The comment came barely four weeks after the President, Major General Muhammadu Buhari, and top officials of the central bank launched the eNaira at the State House, Abuja.

As a result, the Washington-based fund on Tuesday warned the CBN to manage the various risks associated with the digital currency especially the threats it pose to monetary policy implementation, cyber security, among others.

The IMF disclosed this in its ‘Country Focus; Five Observations on Nigeria’s Central Bank Digital Currency.’

The global body said, “Like digital currencies elsewhere, the eNaira carries risks for monetary policy implementation, cyber security, operational resilience, and financial integrity and stability.

“For example, eNaira wallets may be perceived, or even effectively function, as a deposit at the central bank, which may reduce demand for deposits in commercial banks. Relying as it does on digital technology, there is a need to manage cyber security and operational risks associated with the eNaira.”

According to the IMF, the launch of the digital currency is drawing interest from the global world, and other central banks because of the size and complexity of Nigeria’s economy.

The organisation added that the eNaira uses the same blockchain technology as Bitcoin or Ethereum, but is not a financial asset like the two.

The IMF noted that the e-Naira would increase financial inclusion, facilitate remission of remittances, and reduce informality.

According to the fund, Nigeria has a large informal economy with transactions and employment equivalent to over half of the GDP and 80 per cent of employment, respectively.

The IMF said, “The 2021 IMF Article IV mission emphasised the need for monitoring risks and macro-financial impacts associated with a central bank digital currency. The IMF is ready to collaborate with the authorities on data analysis, cross-country studies, sharing the eNaira experience with other countries, and discussing further evolution of the eNaira including its design, regulatory framework, and other aspects.”

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Nigeria Needs $1.5trn In 10 Years To Bridge Infrastructure Gap – Buhari

President Muhammadu Buhari on Tuesday said 1.5 trillion dollars is the cumulative estimated amount needed by Nigeria over a ten-year period, to achieve an appreciable level of the National Infrastructure Stock.

President Buhari gave the figure in Glasgow at a COP 26 high-level side event on improving global infrastructure hosted by President Joe Biden of the United States, EU Commission President, Von Der Leyen and the UK Prime Minister, Boris Johnson, according to a statement signed by presidential spokesperson Garba Shehu.

‘‘Nigeria is ready for your investments in infrastructural development in the country.

‘‘My administration has established a clear legal and regulatory framework for private financing of infrastructure to establish a standard process, especially on the monitoring and evaluation process.

‘‘We look forward to working with you in this regard,’’ he told world leaders at the high level meeting on the margins of the climate change conference.

President Buhari also declared that his administration had taken infrastructure expansion in Nigeria seriously, conscious of the fact that new investments in critical sectors of the economy would aid lifting 100 million Nigerians from poverty by 2030.

‘‘There is a nexus between infrastructural development and the overall economic development of a nation.

‘‘My administration identified this early enough as a major enabler of sustainable economic development and the realization of other continental and global development aspirations particularly the 2030 Agenda for Sustainable Development Goals.

‘‘On my assumption of office in 2015, Nigeria faced a huge infrastructure deficit and the total National Infrastructure Stock was estimated at 35% of our Gross Domestic Product.

‘‘In solving these problems, we embarked on a massive infrastructure expansion programme in the areas of Health care, Education, Transportation, Manufacturing, Energy, Housing, Agriculture, and Water Resources.

‘‘We provided more financial resources for these policies, charted new international partnerships and pursued liberalization policies to allow private sector participation.

‘‘We introduced the revised National Integrated Infrastructure Master Plan – a policy document that ensures our infrastructure expansion projects is cross-sectorally integrated and environmentally friendly, ’’ he said.

The President welcomed the G7 countries for its ground-breaking plan to mobilize hundreds of billions of dollars of infrastructure investment for low – and middle-income countries.

He noted that the “Build Back Better World” plan, an initiative of the G7 countries, is expected to be a values-driven, high-standard, and transparent infrastructure partnership.

‘‘It is our fervent hope and expectations that this plan will be pursued to its logical conclusion in order to bridge the infrastructural gap between the North and South,’’ he said.

The President also used the occasion to outline the principles, values and standards Nigeria would like to see from infrastructure initiatives and the challenges the country has faced in partnering with donors on infrastructure development.

‘‘The aim of pursuing quality infrastructure investment is to maximize the positive economic, environmental, social, and development impact of infrastructure and create a virtuous circle of economic activities, while ensuring sound public finances.

‘‘This virtuous circle can take various forms in stimulating the economy,” he said.

The Nigerian leader noted that infrastructure investment should, therefore, take into account economic, environmental and social, and governance aspects, guided by a sense of shared, long-term responsibility for the planet, consistent with the 2030 Agenda for Sustainable Development.

The President added that the positive and negative impacts of infrastructure projects on ecosystems, biodiversity, climate, weather and the use of resources should be internalized by incorporating these environmental considerations over the entire process of infrastructure investment.

‘‘Domestic resource mobilization is critical to addressing the infrastructure financing gap. Assistance for capacity building, including for project preparation, should be provided to developing countries with the participation of international organizations.

‘‘Quality infrastructure investment also needs to be tailored to individual country conditions and consistent with local laws and regulations.

‘‘Furthermore, Infrastructure projects should align with national strategies and nationally determined contributions for those countries determined to implement them, and with transitioning to long-term low emissions strategies, while being mindful of country circumstances,’’ he said.

The President also called for the environmental impact of infrastructure investment to be made transparent to all stakeholders, noting that this will enhance the appreciation of sustainable infrastructure projects and increase awareness of related risks.

 

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