Category: Comments

By Ekelem Airhihen

 

The recent increase in the number of airlines in Nigeria, Africa’s most populous nation, raises the question on whether African aviation is leapfrogging. The industry has experienced unprecedented shock as a result of COVID-19. This has resulted in fleets of idle aircraft, empty airports and a huge drop in passenger numbers. With vaccinations beginning to gain traction, there is some hope on the horizon. Forecasts point to the industry returning to 2019 levels of activity in 2024.

Technology and innovation are important drivers of economic growth. The period of unprecedented technological advancement in the 18th century was the engine of the Industrial Revolution. The current increase in airline fleet will need to be seen from the perspective of technological change. Analysts have said that aircraft values have dropped during this crisis. Also lease rates have fallen further.

This could be an open window for African airlines to update their fleet to more modern and cost effective planes. Recent travels point to smaller and more modern fleet in use by Nigerian airlines. These planes are smaller in size and will result in more efficient operations. This therefore implies that the overall supply of seats (Available Seat Kilometres) may not have expanded in the industry. If that be the case, the anticipated downward pressure on prices may not be sustained.

While increasing insecurity across Africa makes air travel an alternative, the declining GDP as a result of the COVID-19 shocks on the economy of African countries makes the case for sustained and increasing demand in the short term a not too likely possibility. Reports from the National Bureau of Statistics of China point to rising producer price index. For African nations relying largely on imported goods from China, this raises inflation as a concern and the subsequent erosion of purchasing power.

An industry that is positioning itself and adjusting in the face of shocks will need collaboration of all industry value chain service providers to work together to ensure that the gains are not skewed in favour of some industry players inequitably. The structure of the market is such that there are the airport operator monopolies, the ground handling oligopolies and other players such as airlines, retail concessions and others who have less control over the market than the other industry group members. Working together on an industry plan, a growth path can be worked out to ensure sustained growth and improved customer experience.

Observers believe that Africa’s willingness to embrace change is one factor in its favour. There has been a vast technological innovation in recent years across the continent. People are enthusiastically embracing innovations coming from companies. This trend does not seem to have abated and the hopes of Africa leapfrogging despite the shocks are not too far away.

 

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•  Ekelem Airhihen is a chartered accountant and airport customer experience specialist. he can be reached on ekyair@yahoo.com

By Caesar Keluro

 

COVID-19 shut down the world. Darkside and its franchises are bringing government systems and private businesses to their knees like COVID19, heralding a new age of cyber-pandemic. It looks inevitable that as we see accelerated digitalization, we may witness the first cyber-pandemic that will shut down the whole world before the end of this decade. African firms face a gloomy future especially with the increasing presence of legacy infrastructure, tight IT budget and huge gap in cyber-threat management skill sets.

African banks look vulnerable and so does the larger private sector. We may witness the collapse of a bank as virulent ransomware attacks continue. Tenemos polls put it clearly that “Aging IT is the biggest threat to banks today.” It also found that maintaining legacy systems costs, on average, three-quarters of most IT budgets, showing how widespread the problem is in enterprises, as well.” Experts described legacy technology as both a security issue and a hindrance to innovation. A shift to new technologies like cloud computing, powerful mobile devices and the Internet of Things (IoT) is providing greater flexibility, efficiency, intelligence, automation and security.

Legacy systems as they exist in African markets are opening up vulnerability windows that could malign local firm’s reputations, shrink profitability and weaken competitiveness as it reduces the capacity of local firms to innovate. This demands a cybersecurity audit on African firms’ infrastructure. Leveraging new technologies can help African companies to become more agile, remain innovative and adjust costs to real usage.

These new technologies come with embedded capabilities such as policy management, encryption, authentication and continuous monitoring for greater control.  They are less cumbersome and easier to manage and offer the opportunity to increase revenue through enabling better customer service across multiple channels, which will differentiate any African firm from its rivals. These new technologies can address inefficiencies via consolidating data centers or boosting usage of shared services.

A Darkside pandemic

Darkside may be the most audacious and most business savvy cyberweaponry firm that exists today, as a ransomware-as-a-service, a mimicry of the saas model. It prides itself as having the savviness to provide the best encryption to seal up computers faster than anyone else. It emerged in August 2020, and has leaked the data of more than 80 organisations. The identities of those who paid are shrouded in secrecy.

DarkSide ransom demand ranges between $200,000 and $2 million, helping it rake in more than $30 million. Beyond its vast hacking expertise, it displays a modern communication wizardry in managing the process by exerting pressure on its victims to extract a significant ransom. It also uses public shaming to compel victims to play ball or risks reputational damage.  Darkside is media-clinging as well as a skilled ransomware extortionist. Reported average cost of remediating a ransomware attack in South Africa was put at $447,097 (R6.4 million) while the global average total cost of recovery from a ransomware attack has more than doubled in a year, increasing from $761,106 in 2020 to $1.85 million in 2021 (Sophos). Darkside is ruinous to modern enterprises and society; and the more billions of IoT devices and smartphones come upstream so becomes our vulnerabilities.

Yet the impact of a ransomware attack should be met with commensurate criminal prosecution. It will reduce the profit incentives. A ransomware attack is commonly deployed via phishing emails. It can come as a DDoS attack like those that were launched against several large South African banks, including Standard Bank and ABSA. Sadly, ransom paid by organisations hasn’t helped them get all their data back. This is because using decryption keys to recover information can be complicated. Simply put, there is no assurance of success.

Pains of Darkside Pandemic

Hackers are not defined by geography, but their greed and ambitions are supported by sympathetic nation-states. Whatever the type of attack, the hacker’s intent remains the same — extort ransom from their victims. It is where we work with our global cybersecurity partners to help navigate the thorny maze-like path to recovering from a ransomware attack. We make recovery quick and with less pain even in situations where attacks were deployed with low quality or hastily compiled code and techniques that could make data recovery hard or almost impossible.

More than just decrypting and restoring data, our cybersecurity partners are helping victim companies globally to rebuild their whole systems ground up and manage the painful operational downtime and also reduce customer impact to bearable minimum. As ransomware attacks evolve, and inevitably hit a swathe of African enterprises, we know that anti-ransomware technology, enterprise culture, global standards and partnerships and appropriate punishments will meet this threat.

Finally, African enterprises must equip and expand their pool of cybersecurity professionals. It must drive public awareness on the risks of cyber-attacks and build knowledge capacity about cyber law, enforcement mechanisms and practical regulatory guidance through global and local alliances. The masterstroke will be to mobilize resources across the world-stakeholders at the regional, national, organisational, and individual level to mitigate the risk.

 

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• Caesar Keluro is co-founder/CEO, Nanocentric Technologies Limited. He leads ‘Make In West Africa’, a regional Think-tank. He tweets https://twitter.com/KCaesar,  https://www.linkedin.com/in/caesarkeluro/ 

By Sunny Chuba  Nwachukwu, PhD

 

The International Monetary Fund (IMF) has raised worries over the reemergence of the subsidy policy regime in the Nigerian downstream oil subsector. The global financial institution expresses worries because, the nation’s ailing economy, rather than improving, is being dragged to plunge deeper, without taking cognisance of the hurt and damage brought by this policy in recent times.

The NNPC’s Group Managing Director, Alhaji Mele Kyari, on Monday the 6th of April 2020, during an AIT live telecast declared thus: “The era of subsidy on petrol is gone forever”. Surprisingly, this same economic scourge has reemerged in this oil rich nation, well known for its abundant crude oil deposits, consistent involvement in upstream extractive operations for crude exports.

It is indeed ridiculous to note that this decision earlier taken by the national oil company, declaring a total and permanent removal of this economic destructive package, has once again been made to completely stand on its head, just a couple of months after it was made. Indeed, what a policy somersault on a very unstable economy! An economy that is suffering growth-in-retreat, with high inflation rate, especially made worse by high food prices.

This recent discordant sound beat from the NNPC drum paints an embarrassing picture of lack of seriousness, conveying an impression of low integrity with poor managerial economic principles, of the institution. The expected impact from Nigeria’s oil industry operational dynamics, however, is basically expected to feed the nation’s economy, not to drain or run it down. From all intents and purposes, this appears to be what it has become, a drain on the country’s economy.

With the benefit of having  a wider view of the downstream sub-sector –  distribution and marketing of the petroleum products (petrol, for instance) – the microeconomic indices on demand, capital/investment, production, pricing/market structure and profit management, are all completely at variance with the line of thought and decision taken by the NNPC management; to reintroduce subsidy and then fully activate deregulation for all interested private oil marketers in the country, with the encouragement to officially support them with CBN’s products’ loan package for massive importations of refined products; where the prevailing open market forces will determine products’ pump pricing.

This line of thought is totally unacceptable because, there shall never be any healthy competitive pump pricing dynamics that will favour products consumers. The major reason is that these businesses being wooed by NNPC management buy forex at a highly exorbitant exchange rate to our poorly valued local currency.

Since these businesses must venture to make profit, the imported products’ pump price costs would not be any better than the present NNPC $300 million/N120 billion monthly subsidy undercover paid for N165/litre from N234/litre; on the basis of the nation’s 60 million litres daily petrol consumption. This unsustainable financial burden by NNPC is what shall manifest in full blast once private investors take over. The likely consequence of that is, given the situation in the country, this will, of course, increase tension and worsen the already heated polity, and burst inflation ceilings.

From a simple quantitative analysis carried out, it was observed that this unsustainable arrangement of importation of refined products, using the NNPC’s daily consumption data of 60 million litres of petrol (with the above cost figures given), the monthly subsidy payment of $300 million and the one paid by consumers @N165/litre ($618,750,000) comes to a total figure of $918,750,000. From these figures, it is obvious that about 52 percent of the total daily consumption of refined products utilized is wasted as the losses sustained by the NNPC.

Why then is the management of the NNPC not applying the adequate decision making principles of managerial economics that can deliver this country from the present economic doldrum? Utmost care must be applied,  timely and prudently, to make sure that this tide of economic woes is reversed, and then reposition the economy for progressive growth. Otherwise, this very poor decision could adversely take us back to a very, very unpleasant economic situation, judging from the above illustration.

The proper thing the NNPC’s management should be doing to douse the economic tension is to aggressively saturate the subsector with local refining facilities that can take up the nation’s daily energy demand and make the economy a net exporter of refined products, through the ongoing rehabilitation programmes of the abandoned plants in the country. That will significantly ease off the present stress on forex demands and, of course, it will further strengthen the local currency exchange rate.

NNPC is, therefore, admonished to be proactive in its plans, programmes and all the strategies it is deploying. These are patriotic steps that ought to be taken to change the uncomplimentary image attached to this nation, as the world’s poverty capital. Building this economy at this critical time demands that all hands are on deck, for the sake of actualizing a better, progressive, and very viable economy.

 

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Nwachukwu, a graduate of pure and applied chemistry with an MBA in management, is an Onitsha based industrialist, a fellow of ICCON, and vice president, finance, Onitsha Chamber of Commerce.

Sunny Chuba Nwachukwu (FICCON, LS)

Onitsha, +2348033182105

By Ikem Okuhu

 

The interview was a disaster, for want of a stronger word. As individuals after individuals shared it on social media, the embarrassing scenario that a state governor could find it difficult, after six years in office, to remember and mention his achievements, became the theme for comic skits and endless WhatsApp buzz.

Watching skit after mocking skit, my wish, as an Igbo man would have been to conveniently create a psychological distance from Abia State and then wear the ostrich cloak of empathy and begin to point at this former industrial capital for its lost opportunities. But I know I share in the shame, and although I am from Enugu State, I also know that Governor Okezie Ikpeazu is a breathing metaphor for the crippling retardation of the economies of the south east, and perhaps, for many other states in Nigeria.

Seun Okinbaloye of Channels Television has become the Nigerian Richard Quest, boldly posing difficult questions to Nigeria’s political leaders, and extracting, sometimes, very ridiculous responses. But the response he got from the Abia State governor during his programme has broken new records, almost rivalling the, “My Oga at the Top” given by the Lagos Sector Commander of the Nigerian Security and Civil Defence Corps, on the same Channels Television, some years ago.

Governor Ikpeazu failed this test rather woefully. Watching him, I observed that it must have taken him more than five seconds to find his voice, and even when he did, the detours he took before counting his major achievements off his fingers was a sign he was struggling to find the right answers.

“Well, they are entitled to their opinion, but I don’t think they are right because, for 30 years, it was impossible to access Ariaria from any place, whether you are coming from Port Harcourt or you are coming from Brass. You had to be at some point, stop, and people would back you or…when I came to Aba, there was no single street light…but we have planted over 3,000 streetlights in that city today. And anybody who says that Aba is not working, …today in Aba, you have Domino’s, you have Chicken Republic, you have MarketPlace; you have everything in Aba; you have a cinema in Aba…”

It was searingly pathetic to watch that video. Because I planned to write about it, I had to endure the added hurt of watching it over and over again, including the different skits made by the country’s comedians. It is hard for me to understand how a governor will squeeze six years achievements into one minute and within that minute, couldn’t remember anything of value, except street lights and two link roads, and then ridiculously including two fast food restaurants; and a cinema belonging to private businesses came through the mire of his mind.

I am one of those who strongly believe that the failure to hold leaders to account has been chiefly responsible for the current anarchic social strife conflagrating the southeast and would wish that this intervention speaks to the culpable hypocrisy of those who are currently claiming to be championing the emancipation of southeasterners from the shackles of being a part of an unequal Nigeria. The insect that eats the vegetable lives right inside the vegetable.

In the historically egalitarian southeast, it has become a risky business to speak one’s mind. Political leaders and elders have all become dodgy on the current security situation buffeting the region. Everybody wants to play it safe in order not to be consumed by the karmic vindictiveness of the angry revolutionaries currently fighting for freedom from obviously unfair and oppressive Nigeria.

While I cannot make excuses for the obvious sidestepping of the southeast by the Federal Government, the thrust of this article is to ask salient questions anchored on plain realities and burdensome statistics. I am hoping that answers to my questions will redirect the righteous anger of those who genuinely feel locked out of the prebendaries of the Nigerian state, perhaps redirect such overflowing emotions to proximal centres where they have greatest opportunities to be addressed at much lower human and resource toll.

There are some parts of the south east that are of invaluable political and economic importance. Aba, the commercial capital of Abia State is one of these. The rest include; Enugu, the political capital of the region; Onitsha and Nnewi, the commercial hubs in Anambra State as well as the Uzo Uwani-Oyi and Eha-Amufu-Ebonyi-Aninri agro belts. Sadly, while other areas might be in need of special interventions to ensure the realization of their full economic potentials, the historic city of Aba, once famed as a mirror of the resistant spirit of the Igbo people, has become more famous for its infrastructure decadence and economic regression.

If you ask me, this is where the whole debate on the political and economic marginalization of the people of this area should actually commence. It almost appears hypocritical to be under the worst conceivable form of bad government at the state and local government level while straining the voice box and risking life and limb in spirited agitation for a more difficult self-determination. Our collective conscience should provoke questions to those entrusted with the management of our resources at the state and local government levels and insist they render account of the trillions of naira that have been corruptly squandered since the dawn of democracy in 1999.

The statistics are actually disturbing but we have to look at it in order to, as they say, tell the truth and shame the devil. In the year 2020, and we have to use this as the base year for this analysis, the five state governments in the south east received a combined sum of N248.9 billion from the Federation Account. Imo State, the main theatre of the current crises in the southeast got the biggest share of N55.72 billion while Abia State, where the governor’s memories of his accomplishments failed him that he had to count Chicken Republic and cinemas, got a hefty N48.37 billion.

There are 95 local government areas in the southeast. At an average of N100 million federal allocation per local government each month, this aggregates to N114 billion for the same year 2020. What this means is that were we to look far down the road to 1999 when the current democratic dispensation started, the south east would have received an estimated N7.98 trillion from the Federation Account. Usually, this general sum does not include special funds such as those that go to oil producing states and ecological funds, meaning that quite a significant additional sum would have been allocated to one or more of the states. Over N2.5 trillion have been pumped into the local government system since the current democratic dispensation.

Regrettably, it was under the weight of this huge sum that Aba, a buzzing industrial hub that was the country’s number one leather and shoes centre and number two in fabrics making, collapsed. Growing up in the 1980s in Nsukka, Enugu State, we always looked forward to the Christmas and Easter periods when our cousins and primary school mates would return from Aba for the season. They normally brought home shoes of all types and grades. I still travel to the village where I see most of these former economic pillars vegetating under various forms of economic and social misfortunes because the Abia State Government allowed this industrial city to rot away. But this is a city in a state that has got more than N290 billion from federal allocations (excluding local government allocations) and another possible N81 billion from IGR in the past six years.

There is just no excuse for the decrepit infrastructure and other social and economic dislocations in the southeast. But rather than confront these local insects eating the local vegetable, we have been dissipating energy and resources confronting a distant monster who might just be having a big laugh at us for our grossly misdirected angst. I don’t even want to imagine what a N7 trillion vote would have done to the economy of the southeast had we been electing economically and socially conscientious governors and local government chairmen since 1999. The haemorrhage of local outbound migration that has left the region empty of competent, trained and skilled manpower would long have witnessed reverse traffic.

The time to ask our leaders questions is now. We must quickly compel the likes of Governor Ikpeazu to tell us why the “Chicken Republics” of consumption he has purportedly attracted to Aba shouldn’t have been chicken farms of sustained economic prosperity instead? This is necessary, knowing that the problems in the region stems from low economic productivity and its favourite offspring – unemployment. If we muster half the strength deployed in challenging the political and infrastructure detours by the federal forces, and channel them towards making the political leaders in the east mandatorily respond to the welfare of the people and the prosperity of the region, I can guarantee that most people would not even miss federal presence, and Chicken Republic would not be such a big deal for a governor to count as one of his value delivery after six years in office.

 

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Okuhu, a former Special Assistant to Governor Ugwuanyi of Enugu State, is a journalist, author, farm entrepreneur, whose most recent book is ‘Pitch: Debunking Marketing’s Strongest Myths’

 

By Sunny Chuba Nwachukwu

 

Barring other sources of revenue, Nigeria’s economic growth can improve and be positively impacted by aggressive investment strategies in the downstream of the oil and gas industry. The national oil company, Nigerian National Petroleum Corporation (NNPC), the acclaimed ‘state oil giant’, now going public, is urged to take the right, ambitious steps of making more investments that can benefit the economy with improved revenue generation and GDP ratio from its downstream operations. Otherwise, the present moves being made to take stakes in private refineries shall amount to nothing substantial for the economy!

I offer a note of caution to the top management, that the style of Corporate Governance  in decision making for their initiatives presently, may not favour the national economy. The entrepreneurial ideas of NNPC should be progressive, and aimed at moving the general economy forward, from high inflation (even if the country is assumed to be 100 percent reliant on the revenue accruals from this subsector). Well thought out plans, policies and programmes ought to be progressively germane at all times, and ought not be on a framework of policy summersault for a perceived economy in distress.

At the recent 2-day Nigeria Oil and Gas Opportunity Fair (NOGOF) 2021, with the theme: “Leveraging Opportunities and Synergies for Post Pandemic Recovery of the Nigerian Oil and Gas Industry’’, the NNPC chief operating officer, refining and petrochemicals, Mustapha Yakubu, had disclosed the ongoing discussions for acquisition of 20 percent minority stake in Dangote Refinery. But such a move, in my view, if eventually taken, will not augur well for the economic future of the country, and will clearly be showing the corporation as having taken a defeatist posture in that subsector; expected not of an institution of such magnitude in other parts of the globe.

One, therefore, makes bold to sincerely advise against such a move; and this is without prejudice to this globally acclaimed signature facility, that stands out as the pride of the nation. It is not only that it would be counterproductive in the long run, especially on the Dangote Group’s performance-based operations, being a purely private business venture, it also amounts to taking a decision that does none of the parties concerned any good (in terms of mutual or corporate economic growth), judging by all economic standards and the NNPC’s hierarchy in the schemes of activities in the global oil and gas industry. It might also mortgage the ‘expected’ principal roles it presently plays within the economy, as a federal government agency and regulatory authority (being the expected and known unbiased umpire for the industry) on allocations, provision and usage of crude oil as raw material for refining of petroleum products.

In pure business terms, this decision by NNPC will be unfavourable in the long run for the proposed partnership arrangement because, there ought to be other competitors and players in the same oil sector; that could of course, leverage on this and take advantage, and strategically manage the available deregulated options more freely, for a better competitive edge.

Unless there are other undisclosed reasons such ‘collaboration’ should be a clearly spelled out customer relationship (presented in concrete terms of a seller-buyer relationship); but definitely not an undefined partnership that could sink the height and position of a national oil company of this caliber in the future. The COO’s claim of availability of “huge quantity of crude for that refinery”, does not in any way professionally sound cogent enough and convincing, for overriding public interests. The attractive business opportunities in the subregion, where pump prices of refined fuel are above N400 per litre, offer strong enough evidence to be leveraged and capitalized on for the establishment and development of greenfield refining projects for bigger volume and better accruals of foreign exchange revenues, generated for the economy.

If an economic growth plan is borne in the minds of the top management of the NNPC, they should be proactive in policies and programmes and shun every aspect of  seemingly tainted, retrogressive policies that do not influence improvement in national productivity, which is desperately needed for the economy now.

The ugly experience in Q1 of the 2020 crude oil glut/export challenges faced in upstream operations due to the COVID-19 pandemic global lockdown should not (for whatever reason) be forgotten so soon – the challenges of laden ships on the seas without any space to berth, accruing daily charges on demurrage; equally, the crude producers were paying for storage of unsold crude that period. Let such past mistakes or unprofitable ways of running oil business not be repeated again by the NNPC.

Rather, the NNPC arm, Greenfield Refining Projects Division (GRPD), should now face the unfinished businesses it has at hand. The federal government’s three greenfield refineries projects since 2011, proposed to be sited in Lagos (200,000 bpd), Bayelsa and Kogi (100,000 bpd each) should be brought to full realisation and commissioned for operation; with a proviso that private investors be allowed to buy into the projects, and that it be totally managed as a fully privatized business.

Also, instead of planning to invest a whopping sum of $2.5 billion (20% of $12 billion net worth of Dangote Refinery) as a minority stake holder in an already completed facility, our national oil company, NNPC, should be focusing on the ongoing rehabilitation of the moribund Port Harcourt Refineries at a total cost of $1.5 billion, the Warri and Kaduna Refineries (225,000 bpd collectively), which are yet to be fixed and revived to life, to increase the nation’s total output capacity on local refining. This should make more business and economic sense, than tying down such funds unproductively. With or without approaching Dangote Refinery, the 650,000 bpd facility must be on stream 24/7 come February 2022! The NNPC is therefore urged to be better focused in its investment strategies in the downstream subsector, for the specific purpose of improving this battered economy.

 

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Nwachukwu, a graduate of pure and applied chemistry with an MBA in management, is an Onitsha based industrialist, a fellow of ICCON, and vice president, finance, Onitsha Chamber of Commerce.

Sunny Chuba Nwachukwu (FICCON, LS)

Onitsha, +2348033182105

By Charles Iyore

 

The devil is in the detail

 

President Muhammadu Buhari, has demonstrated the care and bother of the head of state and father of the nation in admitting on the NTA interview, that he is not satisfied with the economy.

The solution, however, is not foreign investors coming to invest here, but husbanding our resources so well, that we become a preferred investment destination and win in the competition for global capital

The president’s dissatisfaction may be more to do with the fact that the outputs are not reflective of the inputs.

Nigeria has been manufacturing poverty on an industrial scale for a long time, and we must be grateful that in expressing his dissatisfaction, he is perhaps ready to resolve the issues. That will require debugging a fourth generation virus that has been morphing in between with various hashtags.

* Every time public officers protect private interest at the expense of public good, they manufacture poverty.

* Every time a public officer makes a critical appointment without considered judgement, of merit and competence, he creates slack in the system, which manufactures poverty.

* Every time an accounting officer, for a ministry department or agency creates a silo, the linkages in governance are broken and the objectives of the organisation are compromised.

These are events that create slacks in the system, compromising public good and betraying the public trust, and they are occurring at all levels of government. They have become an unregulated utility. (egunje)   

The manufacturing process

Industrial manufacturing is the process of turning infeed raw materials through sequenced unit operations, into value added products. Bread from flour, petroleum motor spirit from crude, etc.

If the plant manager is dissatisfied or does not get the desired output, then the unit operations managers, are either incompetent or do not understand the instructions of the plant manager. The managers are then said to be corrupted and the debugging begins.

The biggest challenge of debugging is not the recovery or reduction of waste, but in ensuring that the managers are appropriately driven. What is critical therefore, is to fix the mind/driver of the unit operations manager.   

The mind of the unit operations manager

Public sector managers have over time become slaves of a scarred past, developed a nervous and suspicious disposition for today, and become incapable of dreaming tomorrow.

For that to change, the plant manager must be clear and unambiguous in his instructions and be strict with measurements and rewards. (equity and justice)

The size and population ratio of our needy, is such that we can safely conclude that the production lines of poverty are at all levels of the administration. Federal, States and Local governments.   

Getting the change process started

The vision of the plant manager is critical at this stage, and this he must offer after reviewing the advice available to him. This visioning is why you have concept branding as with Reaganomics, Thatcherism, Glasnost, Perestroika etc.

The first challenge is to re-establish in the minds of the unit operations managers the capacity to dream tomorrow, free themselves of the baggage of yesterday, and be diligent in their efforts today.

That task was started when the president sent his cabinet members back to their constituencies to explain the challenges of the nation during #Endsars.

That same responsibility should now go to councilors, local government chairmen, members of state houses of assembly, members of the federal house of representatives and senators, but this time not just tasked with explanations but also with championing community resilience. Their job description can be so defined as to make it possible to compare like with like. The president should then invite them for dinner, in various groupings, to brief him of progress, every now and again. 

So was #Endsars a stumbling block or a stepping stone? Good wake-up call perhaps.

In debugging the manufacturing process to lift 100 million out of poverty, the president needs to review the utilities or common services, required by the unit operations managers at their points, in the manufacturing process.

1.  Currency: Why are we unable to use market price discovery mechanisms, to determine non pernicious exchange rates, after 32 years of trial?

2.  Skill sets: Why are we unable to train builders to build houses, despite the availability of construction aggregates?

3.  What should the common attributes be, for all communities?  (Towns and villages in planned settlements)

4.  Why is there so much wastage and wide seasonal price variations of agricultural produce? Will a structured logistics blueprint reduce produce wastage and significantly increase the IGR (Internally generated revenues) of states?

5.  Will farming communities do better on produce purchase rather than grand fertilizer distribution?

6.  Why is the quality of bandit intelligence superior to state intelligence, and farmers as a consequence cannot go back to farming?

7. Can we introduce global brokerage to our import and export processes and reduce capital flight?

8.  Can we introduce performance measurement for traditional institutions?

9.  Could we introduce a charity commission to monitor NGOs and charity institutions?

10. Why do the asset allocation ratios of individuals in their homes differ from those of public institutions? (Let’s bring-in kitchen economics to public finance)

Why do the markets not work well for all? Rising pension assets, dwindling insurance collections and gaps in infrastructure financing?

There are many other utilities’ attributes which can be addressed in a sequenced order, to achieve common and even growth targets, for all communities across the country.

  

How did the unit operations get so corrupted?

From the very onset, the preference for divisive sentiments rather than seeking points of co-operation, welled up the wrong references of competition.

The experimentation to correct those distortions led to the adoption of free market economics for national production. Those sets of principles were unfortunately not domesticated appropriately and we threw out the baby with the bath water, in shutting down marketing boards instead of reforming our produce aggregation processes. 

The greatest drawback of this failure was the abdication of state responsibility for market oversight, and MDAs (Ministries Departments and Agencies) began to carve out empires for themselves and scramble for budget slices.

The silos that emerged thereafter, is why some have admitted not knowing how the economy runs.

With central coordination weakened and increasing indulgence of the Treasury by the Central Bank, it’s little wonder we are under such a mountain of debt.

The insufficiency created by poor husbanding of resources over six decades of self-rule, cannot be corrected by foreign investors, who on their own, will be wary of local habits.   

Rolling it all back

The president will not get satisfaction with economic performance, if the virus remains at play in the MDAs and in the private sector. The virus, over time, has offered many the opportunity to make a killing, and those waiting in the wings to have a go at the treasury want the status quo to remain. Against that background, only a careful wholesale debugging of the unit operations, will reset the system. The president can therefore expect to be kept insular if his handlers are some of those waiting in the wings.

This is why the interviews on Arise and NTA could begin a new era of engagement which the president ought to sustain.   

The Production Lines

The production lines are the MDAs not just in their representation in Abuja, but to the extent that they coordinate activities to the local governments, where poverty is manufactured daily.

The Products

The products are industrialisation, capacity building and human capital development, reduced infant mortality, a healthy workforce, markets that work well and productive adsorption of the growing youth bulge.

If the president works with the list of distortions above, and calls on the skillsets of Nigerians at home and abroad, he would deliver on the promises of the first inauguration address, in an 18-month policy cycle.

This would be an act of immense courage, and would be an opportunity for the president to press the reset button and begin the process we did not start on the morning of independence in 1960. Instead the elites (military and civilians) have been hard at work setting up complex processes they knew would deliver nothing.

Properly done, the economy will recover, our currency will join the IMF basket of currencies, and Nigeria can become the arrowhead of African economic renaissance. The continent can then slowly start to address her trade imbalances, and begin to set tracks for industrial value addition.

A hundred million or more will be lifted out of poverty, and the economic growth will become inclusive

This is the challenge the president set for himself in 2015, and that should be his tunnel vision.

 

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Charles Iyore is a partner at DNA Capital, and writes from Darenth Kent, England. He can be reached via email at Dioncta@aol.com

By Sola Oni

 

Financial market regulators, operators and quoted companies have faced the reality that the Newt  Normal thrives on digital mode of doing business. It has also provided customers an instant opportunity to switch their brand loyalty at the click on button. But meanwhile, all brands need customer loyalty. This is to sustain customer retention, enjoy positive word of mouth and enthrone customer lifetime value. There are two perspectives to customer loyalty ; companies’ executives may deploy some programmes for customers to  build brand loyalty, but such programmes do not necessarily create brand loyalty. However, when  an organization aligns its needs to that of customers, this leads to emotional engagement and brand loyalty is at its best. Every astute organization  identifies the best customers, builds humanistic relationship in its core values, tap into the hidden needs  and higher values of customers, and enter partnership to serve them better than the competitors. This helps to cement customer loyalty and insulate companies from competition.

In the highly revered book entitled : Kellog on Branding by Kellog School of Management, the authors, Tybout and Calkins postulate that “ Brands have a remarkable ability to impact the way people view products .Customers rarely just see a product or service; they see the product together with the brand. As a result, how they perceive the product is shaped by the brand. Perception,  of course, matter most- how people perceive something matters far more than absolute truth. The question generally isn’t which product or service, is best: the question is which product or service people think is best.”

Brand goes beyond a company’s logo and colour, they are just brand attributes. The heart of branding is the ability to deliver on promise. Arguably, the  biggest single challenge brand leaders face is dealing with short-term financial needs while brands are essentially long-term assets. A brand can live for a century just as it can crash in a few days. Brand must be embraced by an entire organization from the security guard at the entrance,  receptionist, customer service representatives and the entire staff. For instance, a rude security guard can discourage a high-net-worth customer right at the gate and the aggrieved customer will form negative impression of the company and propagate the perception to prospective customers. On a positive side, a happy customer goes about with positive words of mouth to attract more prospects for the company. Another pain point of a brand manager is clutter of millions of  advertisements and promotions which consumers are bombarded with in every nano second due to advancement in Information and Communication Technology (ICT). Consumers are swimming in an ocean of choices. That is why they can switch from one brand to another seamlessly.

A Brand must be focused and unique to stand out. A great brand must have a sense of association. For instance, Securities Dealers, commonly referred to as stockbrokers must uphold the tenet of ‘My word is my bound”. This alone , if transparently executed, means integrity is associated with the Dealer. Such a brand promise enhances brand positioning. Top brands have brand policy. The companies are noted for creativity and innovation in both products and service delivery. Consumers are not discouraged by increase in the prices of their goods and services as they get value for their money. In the securities market, investors scramble for shares of major brands among the quoted companies. Weak brands stand for nothing. There is personal branding whereby individuals  create and influence public perception by positioning themselves as authorities in their industry. They do this by elevating their credibility through differentiation. We have such people across sectors of the economy and polity. An individual must identify his uniqueness, build  sustainable reputation on the things he wants to be known for. According to Forbes Magazine, an individual rand must be focused, genuine, consistent, tell a story, be ready to fail and bounce back, create a positive impact, follow a successful example, live his brand by separating it from personal life, let others  tell his story and aspire to live a legacy. However, brands are not immune from failure. But a brand’s failure is not  an overnight reputational damage. There must be warning signals. Enron and Wells Fargo did not destroy all trust in their brands overnight. They should have seen some signals before the burble burst. Many companies have collapsed,  and more are still collapsing. Some of them are not necessarily because of the tough operating environment but brand failure. Brands fail because of factors such as weak competitive analysis, rearview mirror syndrome such as when brands remain in their comfort zones, complacency, failure to innovate and absence of brand check or monitoring.

At corporate level, branding works along with stakeholder engagement. This is a process that an organization involves people who may be affected by every decision it makes. It is important to strategic planning because it helps an organization to be proactive towards the needs and desires of every stakeholder in the value chain. By this, trust, confidence and buy-in of stakeholders can be secured before implementing key initiatives. An organisation can engage its stakeholders in varieties of ways, including use of passive communication by avoiding aggressive response  to hurtful situation, tracking internet and other media postings to address their concerns, leveraging social media for advocacy, deployment of bulletins, brochures, letters, reports and websites for messages that do not require response, verbal information, conferences and public presentations, public-private partnership, grantmaking, use of surveys for focus groups, meeting with heads of shareholder groups, collective bargaining with workers through their trade unions, and  using online collaborative platforms among others. Every Chief Executive that wants his company to stay ahead of the curve in this period of business uncertainty should place premium on the fundamentals of branding.

 

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Oni, Communications Consultant, Chartered Stockbroker and Commodity Trader,  is the Chief Executive Officer, Sofunix Investment and Communications

By Stanley Olisa

 

There is this growing trend of journalists infiltrating the public relations profession with the incorrect belief that as a journalist, that automatically implies that you’ll do well in PR. Having journalism experience is no guarantee that you’ll make an excellent PR professional. And make no mistakes: journalism is not public relations, vice versa. These professions are so different from each other, yet people tend to think that journalists make better PR professionals than people who actually majored in PR in school.

But if you’re familiar with the evolution of PR globally, especially from the American standpoint, you would understand the source of this flawed notion that journalism is akin to PR. Let’s historicise a bit. The earliest entrants in PR were of journalistic extraction – practicing journalists who took a stab at public relations, or I should say publicity, because that’s basically what it was at the time.   

The American man adjudged to be the founding father of modern public relations, Ivy Ledbetter Lee, was a journalist (with New York Times, New York World and New York American) before setting up his press relations outfit. Lee related with journalists on behalf of companies, having been a journalist himself. The companies engaged him to craft statements/publicity releases and secure news reportage. And he prospered in this art as a press agent. He’s best known for his publicity work for the Rockefeller family. In this context, it’s safe to posit that PR took its roots from press relations and publicity creation. Lee’s seminal practice must have shaped the understanding that journalism equals PR. 

Fast forward to present day, PR has evolved. It has outgrown press relations to encompass other subjects of stakeholder relations management. Thus, jumping from journalism to PR and thinking your success in the latter will be automatic, is a misguided move. Maybe you will excel in an arm of PR called ‘media relations’ but that isn’t the only touchstone we use to characterise competence in public relations.

The fact that you can write hard news and soft news doesn’t necessarily mean you can just port into PR and achieve success overnight. Press releases (news stories) and articles aren’t the only PR copies we write. We write speeches, newsletters, captions, communiqués, scripts, ad copies, blog pieces, etc. Each of these writings has its style. Besides, PR writing is skewed in a unique way. The writings seek to communicate brand essence while journalistic writings aim to set the agenda for public discourse- Agenda Setting function of the media.

PR has become more demanding now, with more expectations from brands/CEOs beyond just news mentions. Practitioners have to master influencer marketing, online reputation management, thought leadership development, digital marketing, crisis communication, issues management, community relations, employee relations, corporate social responsibility/sustainability management, campaign measurement, etc. These specialties aren’t journalistic- they’re core public relations skills requisite to navigate through the complexities in a contemporary and dynamic business setting. Take a journalist, give them a PR role and rate their performance in the above-mentioned skills. We need to stop looking at PR only through a journalistic lens. It doesn’t help the image of the profession. 

The only point of convergence between PR and journalism is media relations which entails the PR specialist relating with the media and securing coverage for clients/brands. I agree that media relations is a key aspect of PR because through it, the client gets third-party validation. But the media constitute only one stakeholder group of an organisation, and PR is much more than interfacing with journalists for news mentions. This has become my singsong in my PR articles series. Serious PR orientation is required and this article is an effort in that regard.

Some CEOs engage journalists to organise a media outreach leveraging the latter’s contacts. This is good but you make a mistake if you employ a journalist to head a PR department only on the basis of their journalism experience. This experience will only help in achieving news mentions. What happens to other areas of the PR craft? For example, how will the journalist measure campaign success? By employing the controversial Advertising Value Equivalence method or by clip-cutting? These are now being replaced by more reliable, newer techniques which journalism experience doesn’t avail you. I’m talking about more dependable metrics to assess campaign impact and guide decision making.   

Also, while the audience of the journalist seems somewhat amorphous and almost generic, the audience of the PR specialist is clearly defined for every campaign. News is for all; but a press statement, for example, targets a specific stakeholder group. That’s why media selection must be very strategic. We choose the media that best cater to the demographics of our target audience. If it’s an internal communications campaign, only employees and other internal stakeholders are targeted. If it’s a PR campaign to address community activism, then you’re targeting specific stakeholder groups in the host community using local media, opinion leaders and other community bodies. But the journalist’s audiences are not so sharply defined.

Again, the objectives of communication differ. While the journalist writes to inform, educate and entertain, the PR specialist seeks to stimulate a certain stakeholder behaviour that supports the goals of an organisation or a brand. The PR professional communicates to change, for example, an unfavourable perception, sustain public goodwill for an organisation or beef up support for a cause. In PR, we primarily communicate to manage brand reputation and elicit desired supportive stakeholder behaviour for business success. 

Let me stress here that success in business depends on your ability to engender and sustain supportive behaviour from your stakeholders. So, instead of over-accentuating media relations as a compulsory skill in PR, I would rather we shifted focus to stakeholder relations management, which also factors managing the media. That way, we’re developing a multifaceted skillset. 

PR and Journalism are birds of different feathers. One doesn’t equal the other. That an individual doesn’t have journalism experience doesn’t mean they won’t do well in PR. Similarly, if you have journalism experience, it doesn’t automatically mean that you will be a fantastic PR professional. It’s not so clear-cut. Let’s put an end to this misplaced understanding.

 

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•  Olisa, a strategic communications consultant, writes from Lagos, Nigeria.

 

By Ekelem Airhihen

 

There is a recent upsurge in capex (capital expenditure) that is even outpacing the rebound in consumer spending on a global scale and Africa cannot be left out in a world where money seeks the best return across the globe.

Joseph Lupton, economist at JP Morgan Chase in New York is quoted in Global Finance magazine as saying: “I think capex was one of the surprising areas of resilience in the last quarter of 2020, and the latest indicators point to solid capex growth right through the first quarter as well”.

Economist Magazine says forecasters are of the opinion that overall real investment worldwide will soon be a fifth higher than it was before the pandemic. By 2022 companies in the S&P 500 are forecast to be spending over a tenth more on factories, technology, R&D and the like, it states further.

Two things have accounted for the rise in capital spending. First, as economies reopen, the propensity to spend increases. This gives companies an incentive to expand capacity as they are confident of demand for their products. Second, firms are adjusting to shifts induced by the pandemic that are permanent. Working from home and online shopping for instance will require the big technology firms to increase their capital expenditure. Technology and renewable energy stand out in the increasing capital spending, says Global Finance.

This optimism is also playing itself out in aviation in sub-Saharan Africa especially Nigeria. Nairametrics in an interview with the Nigerian Civil Aviation Authority stated that 23 airlines as at April, 2021, were currently seeking to start their operations in the most populous black nation, Nigeria. However safety and security seem to stand out as one of the factors driving the surge in airlines among other factors.

Technology as a driver of the new normal in the transport and travel sector of the economy will require airports, for instance, to replace or upgrade their technology. In thinking through this option the airports must have a plan of how they intend to drive their business leveraging on Information Technology. This will involve thinking through present network and infrastructure facilities and its ability to support the new business models arising from shifts in customer requirements that are not likely to go away soon. Others are downtime needed to implement them as well as training requirements for staff. And finally, the budget must also be considered.

Statista.com estimates that airlines worldwide would lose about 370 billion USD in revenues with Africa accounting for about 14% of the revenue passenger loss in 2020. As things begin to look up and aircraft acquisition increases as a result of increased travel and more airlines, there are certain issues that the aviation industry and especially airlines will need to consider.

The difficulty in assessing US dollar funding will be important. While fares are charged in local currency, maintenance and repairs and lease or outright purchase will be in US dollars. So, industry players should keep an eye on the US Federal Reserve and its pronouncements, the rising inflation in America as a result of the economic stimulus amongst others.

The type of aircraft and the timing of procurement will be crucial as industry players continue to watch the trends in the market especially in Nigeria. The shift towards renewable energy should reduce the demand on fossil fuels. If that happens, fueling costs which significantly affect the costs of airlines, would be lower. But the key here is to watch the trends closely.

Competition cannot be wished away where many airlines are coming into the market. This calls for innovative air service development plans by both airports and airlines. The profitability of an airline flying into any airport is vital for sustainability of airport operations. The talk about code sharing and interlining are attempts at ensuring profitability by maximizing load factor on various routes in Nigeria.

Airport operators, hotels and other players in the transport and travel industry value chain stand to gain from a collaborative approach to the rising capex across the globe. A sustainable air service development plan from a collaborative effort holds some promise for industry growth and profitability.

 

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•  Ekelem Airhihen is a chartered accountant and airport customer experience specialist. He can be reached on ekyair@yahoo.com

By Adekunle Segun

 

While shipping remains the mitochondron of world trade and various tonnes of cargo and lightweight are being transported to different parts of the world on a daily basis, it will be very erroneous to say that there have been no adverse impacts or significant depletion of the marine environment due to the activities of these sea steel giants. For the purpose of our discourse, which is ‘Energy Efficiency’, we can say that a ship is a bundle of various forms of energies. These energies are required to keep the vessel functioning and consequently keep the cargo moving. However, the concept of Energy Efficiency came on board as a means to reduce emissions from ships. These emissions include carbon dioxide and other classes of Greenhouse gases (GHG). These gases have become a very serious source of worry to various local and international organisations engaged in ensuring a sustainable and habitable maritime environment.

What is Energy Efficiency on ships? Energy Efficiency is the comparative ration of carbon dioxide a vessel discharges into the atmosphere calibrated in tonnes. Energy Efficiency is based on the mile of work done by the subject vessel out of which we can then establish if the vessel is effectively utilizing her energy or otherwise. The concept of Energy Efficiency management has been at the fore of climate change and global warming discussion for a very long period. It is said that the world’s shipping industry is responsible for the largest greenhouse gas emission after those of various industrialised countries have been quantified. The gospel truth is shipping will continue to impact the world’s climate. In fact, we can empirically conclude that human activities will continue to impact the world’s environment; however, man can only slow down the rate of impacts or effects with every means available. This is what energy efficiency in shipping seeks to address.

Shipping and, by extension, international shipping, is a major factor in world trade. In fact, global trade and commerce is dead on arrival without incorporating the maritime arm of trade. Global trade and commerce depend on major international shipping line traders to continue to be relevant to humanity. In this regard, all over the world, huge revenues are being generated from shipping and maritime alone. From the earliest times, there have been countries whose major foreign exchange earnings are situated in maritime trade. The various waters of the world have served as a huge source of livelihood to different species of mother nature, it has also accommodated various man-made structures which have seen her concept of civilization spread across the world. However, man needs to actively take up responsibility and business of protecting the world’s waters from abuse due to the fact that the waters are also one of the major sources of survival on planet earth. The world’s waters house a huge source of nutrition to man which if not effectively protected through conscious legislations and responsible actions we may not have a life sustaining maritime environment in the nearest future.

With continuous increase in the world shipping fleet the International Maritime Organization (IMO) resolution A.963 (23) took the bull by the horns to address the growing rate of GreenHouse Gas (GHG) emissions from vessels . A work plan with a specific timeline to erect the needed measures to address GHG was birthed. Though this is quite pronounced when we compare the same with shipping practice, it has become more than significant to put this into operation and save our precious marine environment. Like I stated previously, the world may not be able to totally eradicate GHG; however, we have the pressing responsibility to reduce it to the lowest levels. There is the need to see how various forms of CO2 emissions released into the atmosphere can be converted to other uses on board; which will in turn benefit not only the climate and atmosphere but the vessel owners, managers and operators.

Let us imagine a situation where gases from the exhaust of a ship are diverted to fire a certain turbine onboard the same ship in order to provide power to the generators, which in turn leads to lighting onboard the ship. This will significantly reduce the cost of fuel and other factors that go to running the auxiliary machines onboard. A typical ship can be regarded as a moving house or community based on the size and dimensions and moving such an edifice requires a lot of energy. The energy efficiency drive seeks to reduce and maximize the amount of energy consumption being used by these vessels. Energy Efficiency cannot be predicated on the operations of the maritime industry alone. There is the need to make it attractive and profitable in order to make the various maritime gladiators embrace and see it as a means of reducing the operational, technical and financial burden of maritime business. The IMO has the responsibility to make this concept market friendly. If the energy produced from a ship’s main engine is channeled to other needs like powering the cooling system, workshop machinery, amongst others, there will be a lot of energy and resources conservation on the part of owners and operators of various maritime fleets.

Another area where energy efficiency needs to be closely observed is the area of compliance on the part of the owners, crew and the vessel. Though IMO has released a thorough audit process, vessels owners and crew still need to guarantee unfettered access to their facilities to ensure compliance with this all important drive. Successful audits have so far been recorded and more audits are still needed to be carried out with the audit process constantly modified to suit the purpose for which it is created. However a lot more needs to be done; like incorporating how well a government or subregion fleet is performing on the energy efficiency chart. This is expected to include what the governments of various countries and states are doing to reduce CO2 emissions amongst others.

Thank you very much for your time.

 

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•  Adekunle Segun is a maritime professional…He writes from Lagos; Nigeria.