President Bola Ahmed Tinubu’s year in office has been one like no other. He has willfully turned Nigerians into destitutes in their land of plenty. In a country that is officially not at war and has not experienced failure of rainfalls and drought, it is very painful to see citizens, predominantly women, and children, go through the humiliation of queuing up for cups of rice as one sees in war-torn Sudan, or Gaza Strip.

This harsh and intolerable condition is as a result of President Tinubu’s inhumane, World Bank-prescribed economic policies of sudden removal of fuel subsidy, massive devaluation of the Naira, and interest rate and electricity tariff hikes. These misguided policies have resulted in galloping inflation now at a 28-year high of 33%, and food inflation rate of 40%.

In a country with 133 million, 65% of its population, already in multidimensional poverty and over 20 million children out of school, these policies have added millions more citizens into multidimensional poverty and millions more children out of school because their parents cannot pay for their school fees.

Millions of Nigerians, predominantly women and children, go to bed hungry with no certainty of anything to eat when they wake up. Heads of households are absconding from their homes, abandoning mothers with children because they cannot feed their families.

The government’s answer to this self-imposed hardship is to provide food palliatives. On February 8, 2024, President Tinubu directed the release of 42,000 metric tons of grains from the strategic grains reserve to be distributed free of charge to vulnerable Nigerians. It is now almost 4 months but no vulnerable Nigerian has received anything.

The truth is that the federal government knows fully well that all its silos are literally empty. A Northern governor that was co-opted into this ruse went as far as declaring 5 work-free days for distributing what he very well knew were non-existent palliatives. It is depressing that 64 years after independence, Nigerians are being turned into beggars by their leaders.

Our children's education has never been more imperiled than now because of the return of mass school abductions by terrorists. Ten years after the tragic abduction of 276 school girls in Chibok by Boko Haram insurgents, Nigeria witnessed 5 mass school abductions (in Gusau, Dutsinma, Gada, Ekiti and Kuriga) in the first eight months of this administration. In spite of these school abductions, neither the state nor federal governments are doing anything to secure our schools because only the children of the poor are at risk.

Nigeria’s healthcare system is in shambles, with many hospital wards across the country looking distressingly like abattoirs and Primary Healthcare Clinics abandoned. The healthcare financing system has been hijacked by “middlemen” called Health Maintenance Organisations (HMOs) to the detriment of patients and healthcare providers.

The recent hike in electricity tariff poses an existential threat to the survival of healthcare services in Nigeria. Many hospitals will not be able to pay the new tariffs, as exemplified by a video clip of a Doctor lamenting after receiving an electricity bill of N25.3 million.

There is a mass exodus of healthcare workers out of Nigeria because of the conditions of our healthcare facilities, lack of work tools and poor pay for healthcare workers. Recent report by the Medical and Dental Council of Nigeria (MDCN) revealed that there are 130,000 registered doctors in Nigeria serving a population of 200 million, giving a doctor-to-patient ratio of 1 Doctor serving 1,500 patients (1:1,500).

The WHO’s recommendation is that 1 Doctor should serve 600 patients (1:600). This ratio is much higher in many states signifying that all Nigerians regardless of their station in life, live in a very high-risk medical environment.

Millions of Nigerians have simply stopped taking their medications because they cannot afford them and have resorted to traditional medicines and prayers, resulting in increased disease-related complications and deaths.

Recent data from the Nigerian Hypertension Society suggests that of the 70 million Nigerian adults with hypertension, half (35 million) are not on treatment due to the skyrocketing drug prices, consequently, Doctors are now seeing more and more hypertension-related complications like stroke, kidney failures, heart failures and deaths.

In the last year, hospitals all across the country have been seeing an exponential rise in the number of children admitted with diseases of severe malnutrition (Marasmus and Kwashiorkor).

Children of the poor continue to die needlessly from vaccine-preventable diseases like measles, diphtheria, diarrhea, pneumonia and meningitis due to lack of access to healthcare.

Contrary to the official propaganda and half-truths about improvements in Nigeria’s national security, the reality on the ground particularly in the Northwest and North Central part of the country says differently. Terrorists still control a large swath of the country’s rural areas fifteen and nine years into the wars against Boko Haram and Bandits respectively.

The land is still drenched in the blood of the innocents, villages are being ransacked and pillaged, villagers chased off their homes or abducted for ransom. Farmers are chased off their farmlands or levied on their harvests. Major highways still remain unsafe from terrorists who attack travelers, killing and abducting passengers at will for ransom. Ethno- Religious conflicts and killings continue unabated.

The 400 women and children abducted by Boko Haram insurgents from IDP camps in Gamboru Ngala, Borno state on 3 March 2024 have been forgotten by the government.

The morale of members of the Military is at its lowest because active duty personnel are increasingly being ambushed and killed by terrorists all across the country. In the last 8 months, over 500 officers and soldiers have been reported killed in such attacks.

Recent hurried, unplanned withdrawals of the military from two bandits-infested areas in Maru LGA. Zamfara state and Shiroro LGA Niger state, where the military sustained unfortunate losses, could very well be a sign of frustration and battle fatigue in our soldiers.

While their house is on fire, 10 Northern Nigerian Governors went to America looking for solutions to problems they are complicit in creating because they control the drivers of insecurity in their states. I have said it again and again that all our security problems are local, and their solutions must be found locally, not in Abuja, New York City, Washington DC or anywhere else. The armed militias created by some of these governors in their states have done nothing but worsened the bloodshed.

It is no secret that both the American and French governments have been lobbying the Nigerian government to open bases and station their troops on Nigerian soil following their expulsion from Niger, Mali and Burkina Faso. The real concern is that the timing of the invitation to the 10 Northern governors by the United States Institute for Peace (USIP) may not be unconnected with this lobby.

Addressing Nigeria's intractable security challenges will require a sincere, strategic, holistic approach involving all stakeholders instead of the disjointed fire brigade approach currently employed.

President Tinubu’s economic policies have caused a cost of living crisis in Nigeria resulting in unbearable hardships on all citizens. Workers’ salaries cannot pay for rent, water, food, clothing, school fees, transportation, and other basic necessities of life.

Runaway inflation has pauperised citizens and worsened hunger in the land. Managers of the economy are at a loss as to what to do. Their attempt at borrowing and hiking the interest rates to artificially prop up the value of the Naira against the Dollar has not and will never work.

It is voodoo economics to think that taxing citizens beyond their capacity to pay will revive Nigeria’s comatose economy. Taxes do not grow economies, production does.

The federal government has quietly resumed paying for the same fuel subsidy it removed on 29, May 2023. The simple questions to ask are, why is the pump price not back to where it was before the removal of subsidy,were these payments provided for in the 2024 budget and who are the new Cabals benefiting from these payments ?

The attempt by President Tinubu’s Administration to impose this so-called cyber security tax on citizens is nothing but a desperate effort to elevate the Office of the National Security Adviser (ONSA) to a level that was never intended by the authors of our constitution.

The National Assembly saw through this desperation when it defeated a bill presented to the Senate seeking to grant additional powers and creation of armed agencies under the National Security Adviser (NSA).

The attempt to create a taxpayer-funded Cybersecurity fund appears to be a continuation of this effort that would make the ONSA far better funded than the Ministry of Defence, the Armed Forces of Nigeria, the Nigerian Police and Nigerian Intelligence Services. This will be a very dangerous development that will be fatal to our democracy.

We cannot elevate or give power to an appointee way beyond a representative elected by the people. So, to create a fund in the name of whatever aspect of national security is to arm and empower an appointee of the President.

History should teach us of the dangers of allowing appointees of the President to amass so much unchecked powers as was the case with J. Edgar Hoover who became the most powerful FBI's chief serving as Chief for 48 years under 8 United States Presidents.

Never in the 25-year history of Nigeria’s return to democratic rule have we seen such a brazen and reckless act of impunity as was exhibited by President Tinubu in unilaterally awarding a N15.6 trillion Naira contract for Lagos to Calabar coastal Highway to his longtime friend and business associated in violation of all procurement and due process laws and procedures. Such an amount could complete all the inland roads in the country with some change to spare.

This is a classic case of the term State Capture, which is defined as a type of systematic corruption where narrow interest groups take control of the institutions and processes through which public policy is made, directing public policy away from the public interest and instead shaping it to serve their own interests.

President Tinubu is already setting his sights on his re-election bid in 2027. This explains why he is aggressively amassing a formidable campaign war chest through overtaxations and levies on citizens.

Consequently, he is aggressively cultivating 5 major constituencies: Members of the National Assembly, who refuse to ask the right questions as representatives of their people, Governors, who keep their people quiet by throwing at them palliatives of cups of rice, Religious Clerics, that supported his Muslim-Muslim ticket and the Security Services, who he thinks will protect him from citizens’ anger. The last constituency is Hausa Praise Singers, who have been contracted to sing his praises and songs that would distract restive northern youths from their daily sufferings.

It is unfortunate that by his actions and inactions, the lives, livelihoods and welfare of Nigerians do not matter to this President.

President Tinubu’s impulsive and amateurish handling of the aftermath of the July 2023 coup in Niger is largely responsible for the exit of Niger, Mali and Burkina Faso from the ECOWAS, thereby jeopardizing the survival of the organization created 49 years ago. The exit of these 3 countries from the ECOWAS, acceptance of Russian troops on their soil and the frenzied lobby of the French and Americans to relocate their military bases to Nigeria are all harbingers of bad things to come.

It is concerning that while many Francophone African countries are breaking free from the shackles of oppression and exploitation of their colonial masters, President Tinubu is dragging Nigeria blindly into the embrace of France.

Nigerians have lost faith and trust in President Tinubu’s government due to continuing hardships, increasing cost of living, insecurity, corruption in government, youth unemployment and hopelessness. Leaders continue to live lives of vulgar opulence, corruption, and impunity while citizens live in penury.

President Tinubu's tenure has thus far been a catastrophic failure in governance. His policies have plunged the citizenry deeper into poverty, imperiled our national security and compromised the integrity of our institutions. Tinubunomics, under the guise of reforms, is only intensifying hardships in the land. The misallocation of resources and corruption reflects a leadership that prioritizes personal enrichment over the public interests. This administration's actions are disappointing, morally reprehensible and go against the principles of democracy and good governance. We cannot and will not remain silent.

Usman Yusuf is a Professor of Haematology-Oncology and Bone Marrow Transplantation

It is with profound sorrow but gratitude to the Almighty that I received the heartbreaking news of the passing of the illustrious His Eminence Primate Niran Aluko, JP. His unmatched elegance, grace, and spiritual distinction have left an indelible mark not only on my own life and endeavors but on the lives of countless individuals.

Primate Solomon Niran Aluko, a man of extraordinary accomplishments as a revered business magnate, prophet, and philanthropist, embodied the very essence of entrepreneurial fervor, spiritual enlightenment, and selfless benevolence.

Our paths intertwined during the formative years of my legal career, when he bestowed upon me the great honor of handling the corporate matters of incorporating his proposed Micro Finance Bank and changing of the names of his church, the revered Cherubim & Seraphim Aladura Church in Alausa, Ikeja. I shall forever be indebted to him for granting me the privilege of being his esteemed counsel, a validation that not only bolstered my confidence but also paved the way for unparalleled triumphs.

With his unending sundry briefs, I embarked on numerous journeys to the United Kingdom, where, despite his humble origins as an Oshomalo Ijesha man, he consistently ensured that I traversed the skies in the lap of luxury, aboard business class flights. Through this, he instilled within me an unwavering appreciation for excellence and refinement.

Primate Aluko possessed an unparalleled mastery of strategy, and his acumen in matters of commerce served as a wellspring of inspiration. His narratives, recounting his humble beginnings as a taxi driver, a motor park unionist, and a gardener in the State House, as well as his ascent from adversity to prominence, his privileged insight into the private lives of General Gowon and General Obasanjo, and the profound bond he shared with them, stand as a testament to his proximity to power and the benevolence of the Almighty in his life.

Beyond his remarkable achievements, he exemplified kindness and compassion, treating me as a cherished son. Entrusting me with the sacred duty of safeguarding one of his beloved daughters in Abuja and proposing an Honorary Chieftaincy title for my humble self in his ancestral home of Iyinta-Ijesha, Oyo State, were gestures that shall forever hold a special place in my heart.

The impact he had on my legal practice was immeasurable, and through his recommendations, I became a trusted legal advisor to both influential figures and humble Ilesa taxi drivers in Abuja, a privilege that I shall forever hold in the highest regard.

I recall a poignant occasion when he insisted that I meet one of his esteemed business associates, arranging for me to travel from Ikeja to Ikoyi aboard a Chaverton's chopper! His contributions to my personal growth and professional success are beyond measure, and I shall forever remain grateful for the precious moments we shared.

As I bid farewell to this extraordinary luminary, I implore that his legacy continues to ignite the flames of inspiration for generations to come. May his soul find eternal serenity, and may his memory forever grace the lives of those fortunate enough to have known him.

Farewell, dear Baba Solomon Niran Aluko. Your existence was a divine blessing, and your memory shall forever be cherished as a priceless treasure.

-Dr. Olukayode Ajulo, SAN, OON
Esteemed Attorney General of Ondo State.

The Gulf Stream Executive jet used by the Akwa Ibom State Governor will soon be put up for lease to earn income and relieve the state of its rising maintenance costs. Contrary to speculations, the government has no plans to sell off the aircraft. It prefers a lease arrangement with the government as the owner. Confirming this, the SSG, Mr. Enobong Uwa told me yesterday, ‘’The jet came back from a routine maintenance check last week. We are negotiating to get the best lease agreement for it from various aviation companies. There is no plan whatsoever to sell the jet’’. The absence of the aircraft from its hangar at the Victor Attah International Airport, Uyo, for some weeks has triggered speculations that the plane might have been sold off - five months after Gov. Eno asked the SSG to determine how best to manage its operating costs.

By opting for a lease instead of an outright sale, the government wants to earn income from the plane and at the same time imposes certain restrictions on its use. For example, the government may not allow the lessee to make any alterations or modifications to the plane, including the interior and seating. Second, the lessee will never become the owner. In finance, we describe this as denying the lessee of the residual value of the aircraft. In simple terms, the government wants to keep ownership of the plane while making money from its commercial use. I imagine that the lease agreement may even contain a clause which permits the governor to use the aircraft without paying for it. A One-hour flight in a private jet in Nigeria costs about $10,000 (over N10 million).

I’m in total support of commercializing the plane. The cost of keeping it has become unbearably too high (one estimate puts it at over N5 billion in a year as at two years ago). For a governor that is inclined towards welfarist programs, keeping a private jet at exorbitant costs would fly in the face of what he stands for. Last year, I wrote an article suggesting that it be sold off. Last January when the governor hinted at putting it into commercial use, I applauded the move.

 Now, I ask the government to be very diligent in choosing the charter company. There are many of them in the country, but a reputable one with impressive track records will bring less headaches. In fact, the anomaly in Nigeria’s aviation is that there are more private jets than commercial planes in the country. I urge the governor to be open, transparent and honest in this transaction and all other dealings with our finances. The reason he enjoys so much goodwill is because our people have seen some sincerity of purpose in his actions.

   Jacob could not become all that God wanted him to be until his name and character were changed. You remember his encounter in the midnight with that angel at the bank of Jabbok River. After that wrestling match with God, his name was change from Jacob (supplanter) to Israel (Prince of God, he will rule as God). Yes, you will begin to rule after now! Until you are changed, until you are transformed physically and spiritually, then the totality, the beauty and the fullness of God will not be manifested in your life. The natural takes from the supernatural and begins to rule after every encounter. Can we just read this great account, “But during the night Jacob got up and sent his two wives, two concubines, and eleven sons across the Jabbok River.  After they were on the other side, he sent over all his possessions.  This left Jacob all alone in the camp and a man came and wrestled with him until dawn.  When the man saw that he couldn’t win the match, he struck Jacob’s hip and knocked it out of joint at the socket.  Then the man said, ‘let me go, for it is dawn.’ But Jacob panted, ‘I will not let you go unless you bless me.’ ‘What is your name?’  The man asked, he replied, ‘Jacob.’ ‘Your name will no longer be Jacob,’ the man told him.  ‘It is now Israel, because you have struggled with both God and man and have won...’  Genesis 32:22-31. Praise God!

  This guy needed a tough all night wrestling match, a strong divine push with his last strength to achieve this total, complete, once-in-a-lifetime transformation and the end result proved that the effort worth it. After the struggle, Jacob won, the Sun rose for him and his worst fear (which was meeting his terribly enraged elder brother) was gone. In fact, his fear was instantly turned into victory and joy because Esau though approaching fiercely with his four hundred strong men was immediately ‘melted’ and rushed to embrace and kiss his brother who fraudulently took away his blessings and birth right. In fact, the record said that both of them broke down in tears. Maybe what you also need today is to wrestle with God in prayer until you see that transformation in your life. Though Jacob had acquired some measure of achievement, yet he needed this particular experience to be able to enter his rest, destiny and also to perfect that divine program for his life. Through him the nation of Israel would be birthed and established, but not with his current dubious name and character. His name and nature must first be change from a fraudster to a prince. From the fearful to a wrestler. From an opportunist to a doer of God’s will. And from a manipulator to a prayer warrior. Like me he learnt midnight prayer by force. The word of God said that he wrestled with the man throughout the night and won! I also love the way Hosea puts it. He said that Jacob struggled with his brother in the womb and as a man he also fought with angel and God and won. Wow! Get my book / audiobook Power of Midnight Prayer by Gabriel Agbo to learn more on this.

  Yes, you may also need this transformation now to become what God wants you to be.  You may be looking okay physically, but on the inside, privately, you know that all is not well with you. You need a touch on your character, a change of attitudes, a break from the hindrances, curses and shortcomings. There are impediments that need to be uprooted from your life now, so that you can become what God wants you to be. It may even be sickness or a stubborn problem. You won’t believe it, for some, it is their anger, their stubbornness, their talkativeness, unfaithfulness or their laziness that has stopped them from climbing up or having a sustained relationship, marriage, job, career or spiritual growth. This must change today in the name of Jesus! That Jacob must be changed to Israel! You cannot attain completeness until it is done. Jacob could not. And you must wrestle like him until God does it. Another man called Jabez in the bible also understood this principle and became blessed more than everybody around him. His circumstance of birth and name affected him negatively, but he refused to accept that and prayed until God changed it. You know this, “Now Jabez was more honourable than his brothers, and his mother called his name Jabez, saying, ‘Because I bore him in pain.’  And Jabez called on the God of Israel saying, ‘Oh, that you would bless me indeed, and enlarge my territory, that your hand would be with me, and that you would keep me from evil, that I may not cause pain!’ So God granted him what he requested.” 1 Chronicles 4:9-10. Did you read that?

The first recipient of a genetically modified pig kidney transplant has died nearly two months after he underwent the procedure, his family and the hospital that performed the surgery said Saturday.

Richard “Rick” Slayman had the transplant at Massachusetts General Hospital in March at the age of 62. Surgeons said they believed the pig kidney would last for at least two years.

The transplant team at Massachusetts General Hospital said in a statement it was deeply saddened by Slayman’s passing and offered condolences to his family. They said they didn’t have any indication that he died as a result of the transplant.

The Weymouth, Massachusetts, man was the first living person to have the procedure. Previously, pig kidneys had been temporarily transplanted into brain-dead donors. Two men received heart transplants from pigs, although both died within months.

Slayman had a kidney transplant at the hospital in 2018, but he had to go back on dialysis last year when it showed signs of failure. When dialysis complications arose requiring frequent procedures, his doctors suggested a pig kidney transplant.

“Their enormous efforts leading to the xenotransplant gave our family seven more weeks with Rick, and our memories made during that time will remain in our minds and hearts,” the statement said.

They said Slayman underwent the surgery in part to provide hope for the thousands of people who need a transplant to survive.

“Rick accomplished that goal and his hope and optimism will endure forever,” the statement said.

Xenotransplantation refers to healing human patients with cells, tissues or organs from animals. Such efforts long failed because the human immune system immediately destroyed foreign animal tissue. Recent attempts have involved pigs that have been modified so their organs are more humanlike.

More than 100,000 people are on the national waiting list for a transplant, most of them kidney patients, and thousands die every year before their turn comes.

[NationalDaily]

The Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) have vowed to embark on the planned picketing of  the office of the Nigerian Electricity Regulatory Commission (NERC) and distribution companies (DisCos)’s premises nationwide today over the hike in electricity tariff.

“We write to inform you of the picketing action scheduled to take place in the offices of the NERC and Electricity Distribution companies (DISCOS) in all states, including the FCT,” the unions said in a joint statement by NLC’s Ag General Secretary Chris Uyot and his TUC counterpart Anka Hassan.

“The action will jointly take place on Monday, 13th of May, 2024 nationwide simultaneously. Therefore, the two Labour centres are directed to work together to carry out this important action. While counting on your usual cooperation, kindly accept the assurances of our goodwill and highest regards.”

Their action followed a hike in the tariff for electricity consumers who enjoy at least 20 hours of daily power supply.

Though the NERC had reviewed the tariff, the labour unions said they were picketing the agency’s office as well as the premises of distribution companies after a Sunday reversal deadline failed.

The recent tariff hike for electricity consumers has continued to draw comments from several quarters.

With inflation rising to new highs and Nigerians grappling with the removal of petroleum subsidy, the increase in tariff was met with stiff opposition.

Human rights lawyer Femi Falana (SAN) had claimed that the Federal Government was raising funds for the “cash-trapped” DisCoS with the tariff hike.

But while defending the move, the Minister of Power Adebayo Adelabu said the Federal Government will pay about N1.8trn in electricity subsidy in 2024.
He argued that the Electricity Act, 2023 made provisions for the review of tariffs twice yearly.

“Review of tariff is actually legal once it is within the exclusive responsibility of the Nigerian Electricity Regulatory Commission (NERC),” he said on an edition of Channels Television’s Politics Today. “The Act actually provides for review twice in a year, every six months.”

Following the clapback generated by the move, the House of Representatives asked NERC to suspend the implementation of the tariff hike.

[ThisNigeria]

A renowned Priest of the Catholic Archdiocese of Abuja, Rev Fr Chinenye Oluoma, has lamented the state of the nation under the incumbent administration led by President Bola Ahmed Tinubu.

In a statement issued over the weekend via his Facebook page, titled ‘RENEWED SHEGE,’ Oluoma said politicians must stop offering people hope and instead offer them jobs, electricity, education, health care, and security, as these are what Nigerians need.

He expressed his belief that Nigerians may not fully comprehend President Tinubu’s new hope agenda. Oluoma compared hope to anaesthetics, stating that anaesthetics are used to numb pain during life-saving surgeries.

He shared his concerns on Facebook, highlighting the challenges faced by the nation’s currency, the naira, which is struggling to remain below ₦1500 per dollar. Oluoma also pointed out the significant increase in prices of basic commodities, such as bread, which has risen from ₦500 to ₦1200, and other goods that have doubled, tripled, or even quadrupled in price.

According to him, “Hope doesn’t put food on the table, hope doesn’t pay school fees, hope doesn’t pay hospital bills, hope doesn’t pay house rent (which landlords increase indiscriminately and govt ignores infamously); Hope will not create jobs or make electricity supply constant.”

“The problem here is that successive governments in Nigeria keep administering large doses of anaesthetics to us without carrying out any curative surgery. Maliciously increasing the dosage and frequency once we wake up from the effect of the previous dosage.

“At worst, hope is an opium, a psychic drug that makes you feel okay and patient, maybe even comfortable with all the things going wrong.

“It sedates you but doesn’t change your condition. So, Tinubu offered us hope, not jobs, not improved earnings, not stable electricity or a buoyant economy. He offered us hope, and we bought it.”

Furthermore, Oluoma expressed the viewpoint that politicians should not be the ones providing “hope” to citizens; rather, this responsibility should be entrusted to religious leaders.

He emphasized that it is the duty of the government to create job opportunities rather than merely promising them.

He wrote: “Hope shouldn’t be what politicians offer its citizens, it should be left for clerics like my humble self. A government should offer job opportunities, not hope of jobs.

“A government should offer security, power, housing, affordable health care, education and not hope for these things. Why is Nigeria the place where politicians preach like clergy men and clergy act like politicians?

“While the former offer hope, the latter promise jobs, prosperity and other material well being they are in no position and have no capacity to give. What in God’s blue planet is going on with governance in Nigeria?

“As long as the purchasing power of the poor masses keep nose diving and the prices of basic goods and services keep skyrocketing further beyond their reach, what we have is nothing but ‘Renewed Shege’.

“Each administration will always leave our currency weaker than the previous one, a recurring decimal. One administration shows us Shege, another one comes and renews it and we keep dying gradually in hope. Let the poor citizens of Nigeria breathe, please.”

[NaijaNews]

Telecommunication companies are hitting the brakes on capital expenditure this year as mobile service providers grapple with a cash squeeze arising from record financial losses.

Nigeria’s network quality, which has recorded mixed fortunes lately, is set to worsen as a result of the telcos’ planned reduction in capital expenditure, according to some industry experts.

According to GSMA, the mobile industry’s financial performance has slowed down in recent years due to falling naira revenues and worsening economic conditions.

The situation has led the country’s biggest telcos to announce a reduction in capital expenditure this year.

In 2023, both MTN Nigeria and Airtel declared losses. Airtel recorded a loss of $89 million for its year ended March 2024, and MTN Nigeria’s loss was N137 billion for the year ended 2023. Both telcos blamed the naira devaluation, rising inflation, and worsening macroeconomic conditions in the country.

The naira has fallen from N461/$ in March 2023 to N1,303/$ as of March 2024. MTN and Airtel have hinted that they won’t be spending as much on capital expenditure and will rely more on existing infrastructure.

Airtel Africa, in its financial statement, said: “Having considered all the above-mentioned factors impacting the Group’s businesses, the impact of downside sensitivities, and the mitigating actions available to the group including a reduction and deferral of capital expenditure, the directors are satisfied that the Group has adequate resources to continue its operational existence for the foreseeable future.”

MTN Nigeria, in its Q1 2024 results, noted that its consistent and extensive network investment over the past few years has helped it build the flexibility to optimise our capex deployment.

It said: “In this regard, we plan to reduce capex (excluding leases) for FY 2024 and aim for a capex intensity in the upper single digits. We will optimise latent capacity and implement radio planning strategies in order to minimise any potential impacts and disruptions to our network quality.”

For context, MTN has spent N1.08 trillion on capex in the last two years, and Airtel Nigeria has spent $545 million in the same time period.

“The service providers will continue investing in digital infrastructure to support the digital economy in Nigeria, provided that the economic and regulatory environment improves in a way that supports sustainable investment,” GSMA, said in its report, ‘The Role of Mobile Technology in Driving the Digital Economy in Nigeria: A Partnership between Mobile Service Providers and Government to Support Nigeria’s Future Growth and Prosperity,’ which was unveiled in Abuja on Thursday.

The global association for telcos noted that despite the sector’s N33 trillion GDP and N2.4 trillion tax contributions in 2023, the industry is facing several significant challenges.

“The overall financial performance of the industry in recent years has not been sufficient to support the capital-intensive nature of the business,” it said.

GSMA explained that operating costs have increased significantly in the recent period due to increases in the cost of power for sites due to the rapid increases in fuel price, high and rising costs of tax compliance, and increased demand for forex due to contractual obligations for rollout.

“Underlying these trends in revenue and operating costs has been the deteriorating macroeconomic situation in Nigeria. The high levels of inflation have pushed up the cost of many inputs into the mobile service providers’ businesses,” GSMA highlighted.

The industry body said mobile service providers need to generate sufficient revenue to cover their operating costs and support this level of capex over the medium term. When this is not done, operators are likely to cut back on either capital or operating expenditures or both, it said.

“This results in a shrinking sector which leads to subscribers receiving a poorer quality of service and delays in coverage expansion,” it explained.

GSMA noted that telcos will not be able to pay as much tax in the short term and that digital adoption in the country will slow down in the medium term.

Angela Wamola, head of Sub-Saharan Africa at the GSMA, said: “High-speed connectivity is the bedrock of any digital nation… Future policies should be geared towards reducing the cost and complexity of infrastructure rollout to encourage investment and boost the adoption of mobile broadband.”

The slowdown in capex by the telcos may exacerbate network quality in the country, which has not been at its best. Everyday, Nigerians on X complain about network quality.

To improve connectivity, especially access to fast internet, the Federal Government believes it needs $3 billion to fund an additional 120,000km of fibre optic cables. As of the end of 2023, only 78,676km of fibre optic cables have been deployed in the country, and broadband penetration stood at 43.53 percent.

Nigeria’s plan to achieve 75 percent of fibre optic cable target by 2027 and increase broadband penetration to 90 percent is also now being threatened.

In his remarks at the GSMA event, Karl Toriola, MTN Nigeria’s chief executive officer, noted that the telecom sector was faced with numerous challenges, including insecurity, high operation costs, and taxation.

He said: “The return in the telecommunication sector is poor, and there are no dividends for investors, but on the contrary, other sectors are declaring bumper profit, we are continuously investing massive amounts on infrastructure.”

Gbenga Adebayo, Chairman of the Association of Licensed Telecom Operators of Nigeria, noted, “The industry can only be sustained if we have a continuous flow of investments. As we speak, people are cautious to invest because of the many challenges that we have had from currency devaluation to high cost of business.”

To combat rising prices and other challenges, telcos are currently asking the Nigerian Communication Commissions for permission to raise their tariffs, the first such increase in about a decade.

“The industry is not sustainable, we need a tariff hike, other other sectors are increasing theirs, we are the only ones restricted and it is placing us in a very difficult space,” Toriola, MTN’s CEO declared.

Adebayo, ALTON’s chairman, argued that a price review should be a simple regulatory process and that the government should not use the sector as a palliative to solve people’s problems. “We must price right to sustain the industry; we must price right to have the right investment,” he said.

GSMA also recommended that Nigeria remove retail tariff price control regulations, allow periodic tariff reviews, or set a competitive price band for telcos.

Bosun Tijani, minister of communication, innovation and digital economy, argued that rising tariff prices is not the singular solution to mobile operators’ problems.

“There are tons of other things that we must do to ensure that the business environment is conducive for the investors in this space. And the government is active, including in the tariff conversation,” he said.

[Businessday]

Story highlights

• Nigerian banking stocks have suffered a sharp decline in the second quarter, exacerbated by the Central Bank’s recapitalization directive.
• The FUGAZ stocks, comprising major Nigerian banks like FBNH, UBA, GTCO, Access Corporation, and Zenith Bank, have entered a bearish phase, with share prices significantly declining in anticipation of rights issues.
• Financial analysts have noted that the share price decline typically accompanying rights issues is due to the offer of shares at prices below market rates to entice existing shareholders, thereby increasing the supply of shares and putting downward pressure on prices.

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Nigerian banking stocks have experienced a dismal second quarter thus far. This downtrend follows the Central Bank’s announcement on banking recapitalization, which has set expectations for further declines in share prices.

Investors, particularly those with substantial interests in major Nigerian banks, tell Nairametrics they are bracing for these potential drops. Early trends suggest their expectations of lower share prices is panning out as they gear up for non-dilutive rights issues.

These rights issues are typically the first step in the capital-raising process and could lead to further downward pressure on stock prices they opine.

Banking All Share Index

This trend is currently reflected in the performance of banking stocks. The Banking All Share Index, which tracks some of the most capitalized bank stocks on the Nigerian Exchange, is down 18% quarter-to-date, in stark contrast to the All-Share Index, which has seen a 6% increase over the same period.

• Year-to-date, Nigerian banking stocks have decreased by 6.8%, while the NGX All Share Index has risen by 31.37%.
• This is a significant reversal from the first quarter of the year, during which banking stocks posted a 14.6% return.
• At that time, the narrative was that bank stocks were undervalued both in terms of their earnings multiple and when evaluated in dollars.
• The momentum, however, has slowed recently, largely due to newly announced banking recapitalization plans.
• Nigeria’s Central Bank has mandated an increase in the minimum share capital, requiring international banks to hold N500 billion and nationally licensed banks N250 billion. This directive indicates that the banking sector must raise over N4 trillion (about $2.8 billion) within 18 months.

As a result, investor relations teams at banks are reportedly working overtime to meet these deadlines. But with billions of shares outstanding and freely floating, bank stocks are likely to face downward pressure in the short term as investors anticipate the rights issues.

FUGAZ stocks under pressure

The performance of tier-one bank stocks, which include FBNH, UBA, GTCO, Access Corporation, and Zenith Bank (FUGAZ), points to a bearish streak even as most adjust their prices ahead of dividend announcements.

In a recent Nairametrics report, nearly all the banks dropped below the one trillion market capitalization mark, with GTCO and Zenith barely hanging on. The valuation of FUGAZ bank shares is significantly declining in response to announcements of impending right issues.

• For example, FBNH, whose share price was quoted as high as N43 per share, is now down to N25 per share.
• One investor, who requested anonymity, suggested the stock could fall further to its year low of around N18, achieved on April 24^th, if it continues to be oversold based on their technical analysis.
• A market maker with ties to the bank suggested the bank’s planned N300 billion rights issue could be priced at N15.50 per share, pointing to the same price that was mooted when the bank first announced a right issue in 2023.
• Access Corporation, Nigeria’s largest bank by total assets, has already seen its share price fall to N17.4, just N1.4 shy of its own year low of N16 per share. Access Bank also announced plans to raise N365 billion via a rights issue.
• UBA, another tier one bank, has seen its share price drop from a year high of N33.95 to just N20.50. The board also approved a rights issue for the bank. The last time UBA raised capital via a rights issue in 2015, it did so at a share price of N3.50.
• The same trend applies to Zenith Bank and GTCO, which have also seen their share prices fall from year highs of N47.35 and N53 to N34 and N40, respectively.
• They are also shy of their year lows of N31.3 and N32.7. Both GTCO and Zenith have also announced plans for the right issue.

Although all the banks have announced plans to raise capital, the dates and share prices for the capital raises have not yet been announced

What they are saying

Speaking on the issue, the president of the Association of Capital Market Academics of Nigeria (ACMAN) highlighted that a decline in share price often coincides with a rights issue.

President of ACMAN, Professor Uche Uwaleke, said the trend is commonly observed as rights issues are usually extended to existing shareholders at prices lower than prevailing market rates, aiming to incentivize shareholders to subscribe for additional shares.

Consequently, the influx of shares into the market intensifies, particularly when shareholders choose to divest a portion of their holdings, exerting downward pressure on share prices.

“A fall in share price normally accompanies a rights issue. This is because rights issues are typically made to existing shareholders at prices below current market values to serve as incentives to the shareholders to take up additional shares. So, the supply of shares to the market is increased especially when those shareholders opt to sell part of their shares which end up depressing share prices,” he said.

The Managing Director of Arthur Steven Asset Management Limited and former President of the Chartered Institute of Stockbrokers (CIS), Olatunde Amolegbe, noted that a discernible reaction has been evident since last month following the release of the recapitalization timeline by the Central Bank of Nigeria (CBN).

He emphasized that investors consistently exhibit caution regarding dilution stemming from capital-raising endeavours, particularly those entailing equity augmentation.

Amolegbe anticipates that volatility in banking stocks is likely to persist until the completion of the Rights issues.

“We’ve started seeing that reaction since last month when the recapitalization timeline was released by the CBN. Investors are always wary of dilution that typically results from capital raising exercises especially those involving equity raise.

My expectations are that volatility in banking stocks will probably continue until the rights issues are completed”.

The Managing Director of Highcap Securities Limited, Mr. David Adonri, highlighted that the post-rights Issue price dynamics are typically influenced by the prevailing market sentiment.

In a bullish market environment, prices may experience an upward trajectory following such issuances. However, he cautioned that irrespective of market sentiment, an oversupply of stocks resulting from a new issue could lead to a decline in prices.

Adonri noted that the movement of banking stocks after an impending rights issue is subject to considerable uncertainty, owing to the volatile nature of stock market fluctuations.

Outlook for banking stocks

Despite potential headwinds for investors interested in banking stocks, these conditions still provide a unique opportunity for medium-term investments.

• Banks are perhaps uniquely positioned to achieve the highest profits in their history, bolstered by central bank policies that have enhanced their earnings from foreign exchange gains and income from risk-free government securities.
• However, risks still exist in the longer term, with capital raises likely to increase the number of outstanding shares. The more shares a bank has, the greater the pressure on it to deliver strong earnings per outstanding share.
• Banks also face potential challenges as the era of super profits, driven by current central bank forex and monetary policies, gives way to a reliance on income from riskier lending activities.

Investors also have one eye on risk-free government securities which attract interest rates as high as 20% compared to the stocks which are riskier despite being cheap.

Story highlights

• Amidst macroeconomic headwinds of heightened inflation rate, interest rates and volatile exchange rates due to Naira devaluation, cement companies have managed to sustain profitability.
• Despite sustaining profitability, unlike other sectors, particularly, the consumer goods, cement companies experienced a decline in profitability attributed to elevated foreign exchange costs and high-interest experiences.
• Consequently, this decline is reflected in the profit margin, return on equity, indicating the impact of the macroeconomic challenge.

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Since 2023, the business landscape has been turbulent, characterized by macroeconomic challenges of heightened inflation, fluctuating interest rates, and volatile exchange rates.

As a result, many companies have suffered significant losses, some resulting in retained losses and the erosion of shareholders’ funds.

Nevertheless, amidst these challenges, Dangote Cement, BUA Cement, and WAPCO (Lafarge) have sustained profitability, although not without encountering some impacts.

An examination of the companies’ results reveals the varying degrees of impact caused by these headwinds.

Revenue Analysis

The combined revenue of the three companies in 2023 amounted to N3.074 trillion, reflecting a notable 31% year-on-year growth.

This positive trajectory continued into Q1 2024, witnessing an impressive surge of 85% in aggregate revenue, reaching N1.116 trillion. Notably, this Q1 figure represents 36% of the total aggregate revenue recorded in 2023.

Dangote Cement led in revenue for 2023, reporting N2.208 trillion out of the total N3.074 trillion revenue, marking a 36.4% YoY growth.

It continued its strong performance in Q1, with revenue surging by 101% YoY to N817.350 billion, representing about 73% of the three companies’ revenue in Q1. This highlights its continued market dominance.

The growth in Dangote Cement’s revenue appears to be primarily driven by pricing strategies, as the company’s sales volume experienced a decline of 1.8% to 27 million tons in 2023.

BUA Cement secured the second position in both revenue value and growth. Its revenue grew by 27% YoY in 2023, reaching N459.999 billion. The company further improved its performance in Q1 with a growth of 52%, outpacing its long-term growth trajectory.

On the other hand, WAPCO (Lafarge) experienced marginal revenue growth of 8% YoY in 2023, amounting to N405.5 billion. This trailed its 5-year compound annual growth rate of 17%, indicating a slowdown in revenue expansion momentum. However, there was a notable improvement in Q1 as revenue surged by 50% to N137.77 billion

Profitability and Margins

Despite revenue growth, there’s a noticeable decline in profitability and margins.

In 2023, aggregate pre-tax profit decreased by 2% to N699.114 billion, with a further 4% decline to N196.300 billion in Q1 2024.

This decline can be attributed to increased power costs, foreign exchange losses, and interest expenses.

Collectively, the companies reported a surge in foreign exchange losses, reaching N255.362 billion in 2023, a 246% YoY increase, and escalating to N95.624 billion in Q1 2024, marking a significant 1,133% rise.

Additionally, they incurred significant expenses on fuel and power, totaling N598.137 billion in 2023, representing a substantial 42.45% increase from the previous year.

These trends suggest that the companies are grappling with operational inefficiencies and external economic pressures. Effective cost management strategies are crucial to sustain and improve profitability in the long run.

Dangote Cement stands out as the only company that achieved profitability growth in both 2023 and Q1 2024.

Despite grappling with a substantial 204% surge in foreign exchange losses, amounting to N164.077 billion in 2023, and a subsequent 551% year-on-year increase to N63.765 billion in Q1, Dangote Cement managed to maintain profitability.

In 2023, the company saw a 6% year-on-year increase in pre-tax profit, followed by an even more impressive 13.34% growth in Q1 2024.

However, this increase in profitability was accompanied by a decline in pre-tax margin. This suggests that although the company’s earnings grew, it also faced escalating costs at a faster pace, squeezing its profit margins.

Notably, Dangote Cement’s cost of sales grew by 143%, outpacing its revenue growth of 101% in Q1. This indicates that the company is indeed experiencing rising costs at a faster rate.

BUA Cement faced a notable decline in profitability, with a 44% YoY decrease to N67.220 billion in 2023, followed by a further 39.97% decline in Q1 2024.

This decline can largely be attributed to the accelerated growth in the cost of sales, driven by escalating material input costs that outpaced revenue growth.

Additionally, the company recorded significant foreign exchange losses. In 2023, BUA Cement incurred a significant N69.956 billion in FX losses, marking a substantial 1,172% YoY increase. This trend continued into Q1 2024, with FX losses growing by 688% YoY to N10.1 billion.

These factors collectively contributed to a significant decline by 2,013 basis points in the pre-tax margin, which dropped to 13% in Q1 2024.

With a pre-tax profit margin of 13% in Q1 2024, lower than Dangote Cement’s 20%, means that BUA Cement retains a smaller portion of its revenue as profit. This also could indicate higher expenses or lower revenue relative to costs.

WAPCO (Lafarge) reported the lowest revenue among the three companies in 2023 of N405.502 billion. However, despite this, it achieved the highest growth rate of 13% YoY in pre-tax profit. Additionally, it was the only company that recorded growth in pre-tax profit margin of 4%.

Nevertheless, in Q1 2024, WAPCO encountered challenges as it faced a substantial foreign exchange loss of N21.804 billion. Consequently, this led to a significant decline of 61.26% in pre-tax profit, decreasing to N8.709 billion, and contracting the profit margin to 6.32%.

The profit and profit margin decline of these companies likely contributed to the decrease in return on equity.

In 2023, the average return on equity for the three companies fell by 23% to 19%. Dangote Cement maintained the highest return at 26.40%, albeit with a 27% year-on-year decrease, followed by BUA Cement at 18%, marking a 27% year-on-year decline, and WAPCO at 12%, down 9% from the previous year.

This decline signals challenges in operational efficiency, financial health, and investor confidence, necessitating strategic adjustments.

Despite this, the companies’ share prices have surged, indicating ongoing investor optimism. Dangote Cement leads with a year-to-date gain of 105.28%, surpassing its 2023 gain of 31.25%, followed by BUA Cement at 48% and WAPCO at 39%.