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AMCON Says Some Local Airlines May Collapse Over Debt

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Some Nigerian airlines are facing the risk of collapse under the weight of huge debts, according to the country’s Asset Management Corporation of Nigeria, set up to rescue banks from bad loans.

“The industry remains in the throes of airlines burdened with debts, under administration or on the borderline of collapse,” Amcon chief executive Ahmed Kuru said at the 2018 Colloquium of the Nigeria Travels Mart (NTM) in Lagos.

The colloquium had the theme: “Corporate Governance and Airline Industry Development in Nigeria”.

Amcon acquired the country’s biggest airline Arik last year because of difficulties arising from huge debts and poor corporate governance, it said.

Nigeria’s more than 10 domestic airlines are struggling with difficulties arising from the country’s first economic contraction in a quarter century in 2016, and have seen reduced access to capital and limited leasing opportunities.

The AMCON boss said that lack of regulations and good corporate governance were the main factors responsible for the failure of Nigerian airlines, including the defunct national carrier, Nigeria Airways.

According to him, there are two major problems with the airlines in Nigeria; one being lack of an effective Board of Directors, thereby affecting internal policies and discipline, the other problem has to do with regulation.

“Given the ownership structure of most airlines in Nigeria, the board’s veritable check on management and excesses of airline owners who show very little patience for orderly and planned conduct of business, is practically absent.

“A functional board is necessary for the effective operations of airlines with long term survival and profitability objectives.

“Individuals with independence, experience and expertise from relevant sectors of the economy are not identified and engaged,” Kuru said.

He said on the other hand, regulations were either weak and lack the courage to enforce compliance based on current standards, or need more fine-tuning to ensure effectiveness of the airline.

Kuru said: “The aviation industry is as important as the health industry because it deals with the lives of travellers. It requires more regulations than even the banking industry.

“It is only in Nigeria that an airline can abandon you at the airport for more than five hours without any recourse.

“Indeed, there are consequences for frequent cancellations, however, I cannot recall any airline punished in the recent past.

“That is why I want to use this opportunity to appeal to the NCAA and other regulatory agencies in the aviation industry to show courage and ensure that sound corporate governance systems are enforced.

“A starting point can be the domestication and adoption of the draft Nigerian Code of Corporate Governance 2018.”

Also, Mr. Chris Amenechi, Vice-President, Pricing and Revenue Management, Copa Airlines, Panama, said Nigeria could become an aviation hub if the country addresses the infrastructure deficit in the sector.

He added that the NCAA should not be an economic regulator of airlines but should rather stick to the technical and safety aspects of the business.

On his part, Mr Simon Tumba, Chief Executive Officer of NTM, said the government should focus on airports concession following its decision to jettison the establishment of a new national carrier.

“I believe the government should give more priority to the issue of airports concession. This will give Nigeria an edge and hopefully catapult us to the needed growth in this sector.

“It is very important that this is executed in a transparent manner with full support of the workers,” he said

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Oil: Will a sturdier floor make for a higher bounce?

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By Han Tan, Market Analyst at FXTM,

In the third quarter, WTI crude is set to form a solid base to launch another attempt at the $65/bbl mark, providing the global demand outlook doesn’t deteriorate any further.

The downside for Oil appears to have been mitigated around the mid-$50/bbl range by the recent announcement of revived US-China trade talks, staving off the risk of an immediate deterioration in ties between the world’s two largest economies. Although the existing tariffs remain in place, the prospects of further levies being imposed has dwindled, at least for the time being. That ensures that the growth of global demand, while slowing, isn’t completely snuffed out.

 

Supply-side risks to remain manageable in Q3

On the supply side, the OPEC+ decision to maintain supply cuts at current levels until March 2020 should also set a stronger platform for Oil’s Q3 performance. Concerns about excess supplies flooding the market have been assuaged by a reported 163 percent compliance rate by OPEC+ members in May. With a goal in place to remove some 1.2 million barrels from global supplies in 2019, the tightened-for-longer Oil taps should ensure supply-side risks are managed.

 

Unexpected flare-up in geopolitical tensions could trigger fear-induced Oil spike

Simmering geopolitical tensions have also contributed to Oil’s rise as the current quarter begins. US sanctions on major producers have affected not just the physical delivery of crude, but also market sentiment. Oil market participants remain focused on US President Donald Trump’s Twitter activities, given his fervor for shaking up the global order while pre-empting his foreign policy moves with unexpected tweets. With market sentiment still fragile, any whiff of an escalation in geopolitical tensions could trigger a fear-induced spike in Oil prices.

 

Oil markets to remain cautiously optimistic in Q3

Still, investors might be remiss in believing that things are only looking up in the second half of the year. Developments surrounding US-China trade talks remain fluid, and recent history has shown that events can turn on a dime. Should negotiations between the world’s two largest economies hit yet another wall, the floor could give way beneath Oil. Also keep in mind that the existing tariffs already imposed by the US and China remain in place and have already dragged global growth lower. Additionally, should President Trump open up another front in US-led trade tensions, that will further darken the demand outlook for Oil.

 

US shale output could throw spanner into the works

Then there’s the surge in US shale output, which has been an unrelenting tide that threatens to drown attempts by OPEC+ to rebalance the markets. US supply has been on a record-chasing spree, having notched a new high for monthly output in April when it exceeded 12 million bpd, according to the US Energy Information Administration. Although the number of active rigs has dwindled as producers stateside appear to be shifting priorities towards profitability rather than output growth, their actions may not be enough to stop total US output from hitting 14 million bpd in 2020.

 

WTI crude expected to nudge higher in Q3

Such supply and demand risks could dampen the enthusiasm within the Oil markets for higher highs. Instead of leaping into the air, traders may just take measured moves in nudging prices higher. The key consideration for Oil in Q3 is how much resistance prices will face on the way up.

 

At the time of writing, WTI crude is trading below its 50- and 200-day moving averages. A break above those levels could be met with stiffer resistance at $61.92/bbl, while Oil’s immediate support line can be drawn at $52.28/bbl

 

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Hi-life Fest Quarterfinalists Get Mentored By Phyno, Kcee, Selebobo, & Sunny Nneji.

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Some of Nigeria’s biggest music stars such as Selebobo, Phyno, KCEE and Sunny Nneji met with the quarter-finalists of Hi-life Fest 2019 to offer them some tips and advice on the music industry. This was part of a week-long mentorship program, which saw the eight Hi-life Fest hopefuls have one on one interactions with the movers and shakers of the industry.

Renowned music producer, Selebobo, was the first to meet with the contestants and he was quick to praise the talented acts, while also reminding them that this is just the beginning of the journey. Selebobo who is most notably known for producing Yemi Alade’s 2013 smash hit “Johnny” has been in the music scene for over 10 years. He is also a frequent collaborator with artistes such as Iyanya, Tekno and a host of other A-list performers.

Veteran highlife singer, Sunny Nneji was next to visit the quarter-finalists. He received a warm welcome from the contestants who were thrilled to have the singer in their midst. The “Tolo Tolo” crooner shared some tips about how he has remained relevant in the industry and reminded them to always be humble and open to learning.

 

 

Kcee also made a surprise appearance at the mentorship session, and the singer/songwriter reminisced on his time on Star Quest, while advising the Hi-Life Fest contestants to take full advantage of the opportunity they’ve been presented with.

The cream of the crop, however, was the arrival of Life Lager brand ambassador, Phyno. The indigenous rapper who hails from Enugu was greeted by a standing ovation and his time with the contestants was filled with words of motivation. He took his time to share the story of his meteoric progress in the music industry, while also admonishing Life Lager for giving young talented musicians a platform such as this.

Hi-Life Fest 2019 has lived up to its billing as the number one indigenous music show celebrating the culture and progress of the people. The contestants are set to be back in action on the 21st of July when the quarterfinals of HiLife Fest is hosted in the garden city of Port Harcourt.

To find out the latest updates on the competition, follow Life Lager’s official social media page on Instagram and Twitter @LifeLager_ng, or the hashtags #HILifeFEST2019 and #RhythmOfProgress. You can also catch episodes of HiLife Fest every Sunday at 8 p.m on Soundcity TV.

 

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NSE Declares War Against Cancer, Donates 20M To Combat Disease

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Nigerians from all walks of life, on Saturday July 06, 2019, joined the staff and management of The Nigerian Stock Exchange (NSE) in a 5km race in commemoration of the 2019 NSE Corporate Challenge, an annual competitive and fun-filled 5KM race designed to raise awareness on the importance of early detection and to raise funds towards supporting cancer-related causes.

 

Oscar Onyema, Chief Executive Officer, Nigeria Stock Exchange, in his opening address said

 “Cancer is a resilient attacker and we must be undeterred in our quest to erase the disease.

 

“Cancer related deaths in Nigeria are set to rise if urgent actions are not taken to raise awareness about early detection of the disease and to develop practical strategies to address the increasing burden.

 

 “According to the World Health Organisation, an estimated 116,000 new cases of cancer and 41,000 cancer-related deaths were recorded in Nigeria in 2018.

 

“However, there is hope that one day, using our God-given intellect, science will give us the eureka moment by finding a lasting cure for cancer.”

 

The NSE Corporate Challenge has been highly successful, attracting more than 2,400 runners from over 340 institutions, comprising c-suite level executives, top government officials and celebrities. So far, about N63 million has been raised through support from sponsors.

 

Cancer is a terminal disease that causes abnormal cells to divide uncontrollably and destroy body tissue. Genetic changes that cause cancer can be transmitted from parents to children.

 

They can also arise as a result of errors that occur as cells divide, or due to damage to DNA caused by certain environmental exposures.

 

Cancer-causing environmental exposures could include chemicals in tobacco smoke and radiation, such as ultraviolet rays from the sun.

 

The World Health Organization (WHO), in a 2014 study identified the mortality rate among Nigerian males to be 31.7% for prostate cancer and among females at 34.2% for breast cancer.

 

The 5KM race which kicked off at Muri Okunola Park Victoria Island, Lagos is aimed at calling attention to the importance of good lifestyle, early detection and practical intervention programmes to help sufferers.

 

The race witnessed a large turnout of professionals from diverse financial and business institutions, as well as a number of Nigerian celebrities including race ambassadors Kate Henshaw, Waje and Omololu.

 

Other previous race ambassadors include Ali Baba, MI Abaga, Burna Boy, Seyi Shay, Dolapo Oni-Sijuwade, Gideon Okeke, Debola Williams, Tina Mba, Simisola and Yung6ix, Kemi Afolabi, Titi-the-Dynamite, Ikechukwu, Immaculate Dache, Monica Ogah, and Arole The Prophet amongst others all of whom have committed to working with the NSE to eradicate cancer.

 

 

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