This is contained in a statement signed by Dr Ejike Ndiulo, head of Corporate Communications, Air Peace, on Wednesday in Lagos.
According to Ndiulo, the decision is necessary because NiMet is the agency responsible for issuing CNH (Current Nowcast of Hazardous Weather) reports, critical for safe landings, especially during this season of heavy rainfall and thunderstorms.
He said without these reports from the control tower, flight safety could not be guaranteed.
“As a safety-first airline, we have chosen to act responsibly by suspending operations until NiMet resumes full service.
“We understand this may cause inconvenience, and we sincerely apologise. Passengers will be contacted with updates and options for rescheduling,” he said.
The staff of NiMET on Tuesday commenced an indefinite strike over the condition of service and other demands.
News
CBN Sanction: A Dis-Incentive To Capital Investment
By Cheku Alkali
A fundamental objective of financial regulation is the safety and soundness of financial institutions, and the ability of regulators to mitigate systemic risk through effective policy/reforms.
This assertion represents the statutory mandate of the Central Bank of Nigeria (CBN) under the Central Bank of Nigeria Act, 2007; the Banks and Other Financial Institutions Act (BOFIA); and the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act 1995 and other subsidiary legislations.
Admittedly, financial systems cannot function effectively without confidence in the markets. However, due to the volatile nature of the financial market, regulatory actions or inactions may cause disruption to the financial system; thereby reducing confidence in the ability of markets to function effectively.
This in turn could impair the availability of credit and overall economic activities in the country. It is against this background and the overarching responsibility of the CBN to ensure soundness of the financial system (whilst encouraging foreign capital investment) that this writer examines the impact of CBN’s sanction on MTN Nigeria Communications Limited (MTN).
The Central Bank of Nigeria on Wednesday, August 29, 2018, directed MTN to refund the sum of $8.13 billion for alleged illegal conversion of shareholders’ loans to preference shares; and the repatriation of same out of Nigeria.
Other affected parties are four Banks namely – Citibank, Diamond Bank, Stanbic IBTC and Standard Chartered Bank (the Banks)- all directed to refund the sum of NGN2.5 billion for allegations of illegal remittances of foreign exchange with irregular certificates of capital importation (CCIs) issued on behalf of some offshore investors of MTN between 2007 – 2015.
CBN’s investigation was primarily on three key “infractions” to wit; issuance of Certificates of Capital Importation (CCI’s) for the following items; foreign currency sourced locally; falsely declared capital importation; and interest-free loans converted to preference shares without authorization.
In response, MTN described the allegation as regrettable, and reiterated its intention to vigorously defend its position before a court of competent jurisdiction.
At the time of going to print, we understand MTN has instituted an action in this regard at the Federal High Court of Nigeria.
CCI is a certificate issued by an authorized dealer (usually a licensed commercial bank) confirming an inflow of foreign capital either in form of cash (loan or equity) or goods.
CCI is usually issued in the name of the investor with 24-48 hours of the inflow of the capital into Nigeria.
Its primary purpose is to guarantee access to the foreign exchange market for the repatriation of capital/returns on investment – dividend, interest and capital on divestments, as well as repayment of principal and interest accruing on a foreign loan.
Assuming to be correct, the allegation against MTN and the Banks, the question which arises is whether the CBN has effectively discharged its responsibility of financial supervision given the length of time (8 years) it took to realise, investigate and sanction the affected parties.
As stated, foreign investors are permitted to import capital or invest in any enterprise in foreign currency, through authorized dealers – who are permitted to issue CCIs within 24 (sometimes 48) hours of receiving the capital inflow.
It may then be argued, that the inability of the CBN to effectively and promptly monitor the inflow and outflow of foreign capital, is effectively a failure to discharge its statutory obligation.
Put differently, the CBN should have sanctioned the affected entities long ago to avoid the disruption now caused because of the delay in this regard. An unintended effect of this regulatory lapse may be the resultant lack of confidence and transparency in the financial market, that tends to stifle foreign investment activities.
The CBN Manual 2006 (the operating manual at the time the actions of the above-named entities were carried out) provides that foreign investors are guaranteed unconditional transfer of their capital, profits and dividends attributable to their investments in any convertible currency through authorized dealers.
This means that a company/investor intending to repatriate its capital will be required to provide a CCI as evidence that the original investment was imported into Nigeria.
Following the CBN sanction, MTN has witnessed a drop in its share price by 23%. Even in the event the allegations are false and MTN succeeds in its claim against the CBN, the reputational damage to the nation may be irreversible.
For the savvy investor desirous of repatriating capital returns, economic headwinds would seem to warn against bringing in capital investment. Investors would find it easy to conclude that bringing in funds would be unwise because of a perceived inability to access and repatriate same when required.
Thus, by failing to proactively supervise the instant issue, the CBN; despite acting within its statutory powers, may occasion a ripple effect on investor’s confidence in Nigeria’s financial system.
Looking forward, instead of taking similar (delayed) reactionary measures, this writer suggests that the CBN should look to strengthen its monitoring, and processing of CCIs of foreign investment flows in and out of the country.
To achieve this, it can adopt a twin approach to its supervisory role to ensure transparency, market integrity, and consumer protection. This approach of coupling the power of sanction with proactive regulation, will also ensure that the CBN acts as a catalyst for foreign direct/portfolio investment as opposed to becoming an inadvertent market disruptor. It will better reinforce the CBN’s commitment towards ensuring a transparent and stable financial system.
A regulator such as the CBN must always weigh the outcome of its actions or inactions on the market before taking any step. Although it is difficult to have near perfect supervision, it is possible to implement stronger financial supervision measures to reduce the chances of putting foreign capital investment to flight.
Financial regulation in this regard can serve as not just a means of maintaining stability, but as an instrument for growth and development of the financial system.
Cheku Alkali is an Associate of Perchstone and Graeys
Against the backdrop of Lagos State’s proactive efforts to reform its electricity sector, the Consumer Advocacy and Empowerment Foundation (CADEF) has launched its ‘Renew Energy Nigeria’ platform, a nationwide initiative with potential synergies for the state’s ambitious energy goals.
Professor Chiso Ndukwe-Okafor, CADEF’s Executive Director, introduced the platform in Lagos, highlighting its aim to empower Nigerians with information and access to decentralized renewable energy (DER) solutions. “The launch of this platform marks a significant step towards democratizing access to information and resources within Nigeria’s burgeoning sustainable energy sector.”
The platform’s launch comes as Lagos State, under the Lagos State Electricity Law, is actively establishing a regulatory framework and attracting private sector investment. Kamaldeen Abiodun-Balogun, General Manager of the LSEB, detailed the state’s progress in creating a functional electricity market, ensuring payment security, and addressing infrastructure challenges. “This law enabled us to create policy documents and establish regulatory agencies to initiate the implementation of the Lagos electricity market,” he explained, adding that private sector involvement will be key in areas where existing Discos face performance issues.
Segun Adaju, a private sector player deeply engaged in the energy sector, lauded Lagos State’s leadership. “In all these, Lagos State is always setting the pace. Many of us in the private sector players like myself, we are also looking up to Lagos State to set the pace,” he said, also mentioning his work on the Centralized Renewable Energy Desk for the state government.
While acknowledging national-level challenges such as import restrictions and forex fluctuations as noted by Professor Ndukwe-Okafor: “The recent federal plan on restrictions on the importation of solar products and the fluctuation of forex rate have made clean energy solutions costly”, the focus on Lagos State’s progress suggests a promising local environment for DER adoption, potentially amplified by CADEF’s new platform.
The broader socio-economic context, as highlighted by Olumide Ajayi, “Over 40% of Nigerians do not have access to reliable electricity”, underscored the importance of initiatives like ‘Renew Energy Nigeria’ and the enabling policies being implemented in states like Lagos.
Professor Ndukwe-Okafor concluded with a powerful call to action. “This platform is not an isolated intervention. It is aligned with our ideal country’s national vision, the 30-30-30 initiative. Let us not build a solar future that only serves the wealthy. Let us democratize clean energy. Let us make it local, inclusive, and scalable.”
The launch of “Renew Energy Nigeria” marks a significant step towards a more sustainable and equitable energy future for Nigeria, driven by innovation, collaboration, and a commitment to empowering its citizens. The platform is now live and accessible to all Nigerians seeking reliable and clean energy alternatives
A federal high court in Abuja has granted permission to the Economic and Financial Crimes Commission (EFCC) to arrest and detain six Crypto Bridge Exchange (CBEX) promoters over allegations of investment fraud to the tune of over one billion dollars.
Emeka Nwite, presiding judge, gave the order following an ex parte application moved by Fadila Yusuf, counsel to the EFCC.
In the application by the EFCC, the six suspects are Adefowora Olanipekun, Adefowora Oluwanisola, Emmanuel Uko, Seyi Oloyede, Avwerosuo Otorudo and Chukwuebuka Ehirim.
The commission sought an order of the court for a warrant of arrest of the defendants.
They also prayed the court for “an order remanding the defendants in the custody of the complainant/applicant pending the conclusion of investigation of the alleged offences and possible prosecution”.
Yusuf said that the defendants are at large and a warrant of arrest is required to arrest the defendants for proper investigation and prosecution of this case.
In the affidavit in support of the motion, the EFCC said preliminary investigation into the intel revealed that the defendants “using their company ST Technologies International Limited, promoted another company Crypto Bridge Exchange (CBEX) by making adverts and lured unsuspecting members of the public to invest crypto cryptocurrencies on the CBEX investment platform”.
The EFCC said the defendants promised an unrealistic return on investment of up to 100 percent.
“The victims were made to convert their digital assets into a stablecoin of USDT for onward deposit into the suspects’ crypto wallet,” Yusuf said.
“The victims were initially given full access to the platform to monitor their investment.
“Following the deposits valued at over $1 billion by the victims, the CBEX investment platform became inaccessible to them, and they could no longer withdraw from the investment made.
“The victims later discovered that the said scheme is a scam.
“During the course of investigation, it was discovered that the said ST Technologies International Limited, though registered with the Corporate Affairs Commission (CAC), it was not registered with the Securities and Exchange Commission (SEC) for investment purposes.
“It was also discovered during the investigation that the defendants had moved out of their last known address in Lagos and Ogun states.”
The anti-graft agency said obtaining a warrant of arrest was necessary in order to place the defendants on a watch list, enabling authorities to trace and apprehend the suspects to face the charges brought against them.
Nwite granted the request for a warrant of arrest and remand, adding that the order was necessary to enable the commission to apprehend the defendants and conclude its investigation.
“I have listened to the submission of the learned counsel for the applicant,” Nwite said.
“I have also gone through the affidavit evidence with exhibits thereto, along with the written address.
“I am of the view and I so hold that the application is meritorious.
“Consequently, the application is granted as prayed.”
Earlier in April, reports emerged that CBEX users could no longer withdraw their funds.
On Monday, angry investors stormed and looted the office of Smart Treasure (ST Team), an affiliate of CBEX, in Ibadan, Oyo State.
The EFCC recently confirmed receiving multiple complaints about the platform.
Dele Oyewale, the commission spokesperson, assured affected investors that efforts were underway to recover their funds.
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