David Mark’s wife, Dangote, Adenuga, others named in #SwissLeaks as operators of secret foreign accounts

Some of Nigeria’s wealthiest industrialists, former government officials and their relatives, were amongst thousands of individuals around the world who operated highly secretive foreign accounts with the Swiss branch of banking giant, HSB​C, concealing their identities for years and using codes perhaps to shake off tax authorities from accounts, some of which held illicit assets from criminals, traffickers, arms dealers and other outlaws, secret files published last week by a consortium of journalists around the world have shown.

The trove, released by the French Daily, Le Monde and the International Consortium of Investigative Journalists, in partnership with PREMIUM TIMES, and a host of other major media organisations around the world, showed how HSBC profited doing business with people who stole from their countries and some of the world’s most notorious con artists, including people who made a fortune fuelling wars in Africa.

PREMIUM TIMES is the only Nigerian publication involved in the investigation, which lasted several months.

The bank helped questionable characters conceal their wealth despite knowing their sources, and devised ways to hide the identities of the owners of the secret accounts from governments around the world.

At least 100,000 secret bank account operators who owned about $100 billion were exposed in the leaks, unsettling investigators in several countries.

CBN sells dollar to banks at N198

In a bid to reduce pressure on the naira, which has come under speculative attacks in recent weeks, the Central Bank of Nigeria on Wednesday announced the closure of the Retail and Wholesale Dutch Auction Systems of the foreign exchange market.

The closure, which takes immediate effect, was confirmed in a statement issued by the Director, Corporate Communications Department, CBN, Mr. Ibrahim Mu’azu.

In taking the step, the central bank was said to have fixed the exchange rate of the naira to the dollar at 198, which is N30 above its N168 (+/-5 per cent) rate.

As a result of the plunge in global oil prices, the CBN had in November devalued the naira by eight per cent as it officially pegged the currency at 160-176 to the dollar.

Following the postponement of the general elections by six weeks on February 7, the naira hit an all-time low of 202 against the dollar at the interbank segment of the foreign exchange market last week, stoking speculation that the CBN might devalue the currency again.

In a new report entitled: ‘Nigeria: Devaluation pressures grow’, the Ecobank’s Economics Research Desk, headed by Mr. Angus Downie, said for a second time in recent days, the CBN sold the US dollar outside of the Retail Dutch Auction and interbank market on Monday.

The report stated, “The CBN asked banks to submit the amount of the US dollar demand they required based on a selling price of N198, with bids assessed on the banks’ actual levels of client demand.

How Civil Society helped block secret plot by Lagos Govt., World Bank to privatise water

The announcement sent a collective sigh of relief to the water corporation staff and civil society activists. After months of negotiation on how to privatize the water supply in Lagos, between the World Bank and the Lagos Water Corporation, the bank has called off the talks.

But before the bank’s decision, activists and civil servants had mounted pressure on the water company against such a move, which they said would raise the cost of having access to water beyond the reach of ordinary Lagosians.

The Corporation’s staff, who stood to lose their jobs, went a step further to threaten to do “everything to frustrate” the move.

Last month, the World Bank issued a statement announcing a breakdown in talks between its International Finance Corporation and the Lagos Water Corporation.

“Contrary to recent reports, IFC has not signed any agreement with the Lagos Water Corporation (LWC),” the bank said in the statement. “LWC expressed interest in working with IFC and we had a number of discussions on how we might be able to assist the company. In the end, IFC decided not to advise LWC. We continue to support the government and people of Nigeria in achieving their development goals.”

Shrouded in secrecy

The latest round of negotiations between the bank and the LWC to design a water privatization scheme in the state began 18 months ago.

With public outcry on the danger of such a move, the LWC maintained that it was not going into privatization, just discussions on how to optimize water supply to Lagosians.

But details of their negotiations were kept away from the public, including civil society groups who had pushed for information disclosure.

In October last year, a rights advocacy group, the Environmental Rights Action/Friends of the Earth Nigeria (ERA/FoEN), said it made attempts to obtain information relating to the negotiation but continually met brick walls.

“Despite the World Bank’s 60-day disclosure policy, the Lagos contract had not been disclosed on the bank’s website and had been hidden from civil society,” said Akinbode Oluwafemi, Director of Corporate Accountability, ERA/FoEN.

With pressure from Nigerian groups, hundreds of other civil society bodies and activists across the United States began calling and sending out messages to the World Bank demanding full disclosure of the project.

“Our investigations indicate that the IFC is currently being paid by the Lagos government as an official advisor to develop a plan for the city’s water privatization,” Mr. Oluwafemi said.

“And this advisory contract is undisclosed by both the World Bank and the Lagos government, and both the privatization the IFC is designing and the advisory contract itself are being carried out in secrecy, without public participation and input from Lagosian stakeholders.

“This lack of transparency leaves residents with very little information about important developments that will affect them directly.

In December, our source’ Freedom of Information request for details of the negotiations with the World Bank also met a brick wall. An official at the LWC headquarters at Ijora declined to answer questions put to him and promised to e-mail answers or arrange an interview with the Group Managing Director, Shayo Holloway.

He did neither.

Lagos State has two major waterworks at Iju and Adiyan, providing a combined supply of 115 Million Gallons Per Day for the 20 million residents, according to information on LWC’s website.

Expansion of other waterworks – micro and mini waterworks – spread across the state has been ongoing for years, and provision of tap water is still limited to a fraction of the population.

The corporation says its current installed capacity is 210 million gallons per day, whereas the actual water demand in Lagos is 540 million gallons per day.

Most residents solve their water needs through self-help, patronizing water vendors, digging wells, or sinking boreholes in their homes.

No Privatization Plans

Before the World Bank announced its decision to shelve talks with Lagos State government, the LWC management had continued to insist that it had no plans to privatize the corporation.

Mr. Holloway said, in a statement December, that the Lagos State government was only trying to partner with the private sector “in a bid to increase water supply and alleviate poverty”.

“According to Engr. Holloway, PPP (Public Private Partnership) is not Privatization. Privatization involves the sale of government-owned asset to private investors, while PPP involves fresh injection of private capital into the efficient management of government-owned assets,” said the statement published on the corporation’s website.

“In order to meet the demand gap as well as the Millenium Development Goals (MDGs) 2015, LWC has developed a Lagos Water Supply Master Plan (2010 – 2020) which outlines the infrastructure development programmes into short, medium and long term phases.

“By year 2020, water demand is expected to be 733 million gallons per day, while the water production will be 745 million gallons per day, leaving us with the excess of 12 million gallons per day. The need to bridge the gap has necessitated the involvement of the private sector by way of injecting more capital to improve efficiency of existing state-owned assets.”

The LWC refused to make public the nature of its partnership with the “private sector.”

But according to information obtained by our source, the water corporation’s plans involved a concession of the state-owned major water works to private investors who would produce water and sell to the government. And the government would then sell to the final consumer.

Dissatisfied workers

On December 17, the corporation’s workers’ union, the Amalgamated Union of Public Corporations, Civil Service Technical and Recreational Services Employees, AUCPTRE, held a meeting with the management where they aired their disagreement with the planned “partnership”.

Tomiwa Odusanwo, the chairman, AUCPTRE branch of LWC, insisted that the management was planning to privatize the corporation.

“You cannot know my management beyond me,” Mr. Odusanwo told our source in an interview in January.

“We were not carried along. The funny thing is that we heard it over the news, read it in newspapers, and because we have seen how it was recorded in other African countries, even in western world.”

“The Iju and Adiyan water works are going to be in concession as well. There are some foreign investors now, in their master plan for 2010-2020, that those investors will use their money and construct mini water works.”

At a workers’ meeting at the LWC headquarters in Ijora, Mr. Odusanwo and his colleagues were unanimous that they won’t go the way of the staff of the recently privatized Power Holding Company of Nigeria, PHCN, who protested for months over the non-payment of their severance benefits.

“The management of Water Corporation, presently, are after capital projects. They are not after welfare of the staff or anything that will benefit the staff. That is why we are saying no to that privatization,” said Mr. Odusanwo.

“Because presently now the corporation is owing pension, gratuity, plus pension to PENCOM close to N1 billion. As I speak to you now our deducted pension was not remitted adequately to our PFA (Pension Fund Administrator).

“The corporation is indebted seriously. So with privatization, many of us will be laid off without going home with a penny and that will be so disastrous for us.”

The involvement of the World Bank and its investment arm – the IFC- in water schemes across the world has not exactly been a success story.

Recently, many cities that, in expectation of availability of affordable potable water, signed a two decade or longer water concessions with private investors, have terminated the contracts and returned their water systems to the state.

According to Transnational Institute, an organization that studies global needs, 180 communities and cities across the globe, from Accra to Kuala Lumpur, have returned water provision to public control in the past ten years.

In January, the IFC announced it had no ongoing water concession projects in Africa, after about 30 per cent of its water investment in Africa over the past two decades resulted into a failure.

“Like in Manila, in Ghana, World Bank corporate partners attempted to privatize and profit from water,” said Mr. Oluwafemi.

“Poor service, limited access and chronic quality problems forced the Ghanaian government not to renew a bank-backed contract for a private corporation to manage the country’s water.

“Around the world, the IFC advises governments, conducts corporate bidding processes, designs complex and lopsided water privatization contracts, dictates arbitration terms, and is part-owner of water corporations that win the contracts it designs and recommends, all the while aggressively marketing the model to be replicated around the world.

“Not only do these activities undermine democratic water governance, but they constitute an inherent conflict of interest within the IFC’s activities in the water sector, an alarming pattern seen from Eastern Europe to India to Southeast Asia.”

In Lagos, commercial sale of water by individuals is big business, with a 20-litre jerry can selling for N20 in most areas in the metropolis.

However, the cost of the water provided by the LWC comes at a cheaper rate, depending on the location.

In Dolphin Estate, Victoria Island, for instance, a flat pays a monthly rate of N800 for water while a duplex is billed N2, 400.

Water rates on the mainland costs even cheaper.

In Surulere for instance, a flat is charged N500, while a duplex is N800 monthly. At the Ojota axis, where there are a lot of single room apartments (popularly known as ‘Face-me-I-Face-You), a room is N100. A flat is N500, and a duplex N800.

According to civil society groups, water privatization negates the 2010 United Nations recognition of water as a fundamental human right.

“If the IFC was successful in securing a large-scale water PPP in Lagos, it would mirror that of the electricity sector privatization, which has imposed sky-rocketing electricity bills without delivering improved service,” Mr. Oluwafemi said.

“The IFC’s track record in the water sector is frightening: prices sky rocket, utility workers lose their jobs, water quality suffers, low-income communities have their water shut off, governments incur devastating debt, and public sovereignty is threatened by undemocratic arbitration.

“Privatization is not the solution for Lagos: it leads to corporate profits and has never provided universal access.
 

Additionally, if the IFC deal (had sailed) through, it would have opened the doors for several contracts for water corporations to take over the water system, and bidding by 2015.

Breaking News: Lagos launches 100 air-conditioned Internet-enabled buses

In pursuit of its resolve to ease travel within the metropolis, the Lagos State government in conjunction with LAGBUS Asset Management Limited, one of the operators of the Bus Rapid Transport, on Tuesday launched 100 air-conditioned, WIFI Internet-enabled buses.

The new buses, which are called Metro Bus, and are expected to ply the Sango-Oshodi, Obalende- Ikorodu, and Island –Epe routes, will hit the road soon.

The buses are expected to be increased to 1800 servicing 47 routes within the metropolis and are aimed to provide comfort and safety as well as reduce time spent commuting.

LAGBUS has also introduced innovations such as the ability of commuters to check the arrival time of the bus by sending sms to a specialised number.

“There would be security camera on board to ensure safety of passengers. The live feeds from the cameras will be made available to security agencies to be able to track any mishap. Customers can also use WIFI on the buses as well as enjoy videos and music on the go”, said Niyi Oguntoyinbo, the managing Director of Metro Bus.

The buses are expected to provide 1,500 direct jobs and 5,000 other jobs for agents selling the preloaded cards.

Speaking at the Lagos State Traffic Management Authority Yard, Oshodi, the state Governor, Babatunde Fashola, said the provision of the buses is in line with the multimodal transport system, which include road rail and water, driven by the private sector.

“Government did not own the BRT buses; it was private sector that owned them. Our job was to build the roads, the bus shelters to maintain and manage them while they ran their buses but that environment at the time they were borrowing money at One Dollar at 118 Naira and interest rate at 10 per cent has changed completely,” he said.

“They agreed and bought the first set of buses. They took loans, paid off the loans, recapitalized but again the environment in which they invested then has changed substantially.”

The buses are a welcome development as it would help ease pressure on the overused and mostly rickety BRT buses.

Chinese Government gives 17 buses to Ghana

The Chinese Ambassador to Ghana, Ms Sun Baohong on Tuesday presented 17 ZhongTong buses to the Ministry of Transport for onward distribution to state institutions which need them

The presentation of the 35-seater buses, which cost 10 million Chinese Yuan, was in partial fulfillment of the Economic and Technical Cooperation Agreement signed between the Governments of Ghana and China in 2009 and September 2010.

Receiving the buses, Mrs Dzifa Attivor, Minister of Transport, expressed her appreciation to the Chinese Government for its assistance to the economic development of Ghana over the years.

‘Despite the long distance, cultural and socio-economic differences, cooperation in various fields have deepened, enhanced the existing cordial relations to the mutual benefits of both countries’, she said.

She noted that since the establishment of diplomatic relations, the two Governments had been helping each other in the fields of economic development, trade, educational and cultural exchanges.

She said the buses had been made to suit specifications in Ghana and our road, adding that, Zhong Tong Bus Holdings Company, which was the manufacturer of the buses would provide theoretical and practical training to drivers and mechanics of the institutions which would benefit.

She intimated that the Ministry of Transport after careful deliberations would give the buses out to state institutions which might be in need of them.

She added that the Ministry was also in the process of taking delivery of 116 Huanghai buses from China for the metro Mass Transit.

Ms Sun Baohong extolled the trade relations which had existed between Ghana and China over the years and expressed the readiness of the Chinese Government to support the Ghanaian Government agencies.

Credit: GNA

Weak naira, fraud shoot up diesel price

The continued fall in value of the naira against the United States dollar and alleged racketeering by some petroleum product marketers are responsible for the high cost of diesel despite the global drop in crude oil prices, the Petroleum Products Pricing Regulatory Agency has said.

This indication emerged on Friday as industry experts accused some marketers of forming a cartel that had kept the price of the product high since June last year when the free fall in oil prices started.

According to the PPPRA, the depot price of diesel as of February 11, 2015 was N99.51, while its pump price was N108.85.

The Executive Secretary, PPPRA, Mr. Farouk Ahmed, however, told our correspondent on Friday that the product was not sold at N108.85 in any of the retail outlets across the country because diesel dealers were paying more to get the US dollar at the interbank market.

He also noted many of the dealers were finding it difficult to get the dollar at the official exchange rate of N168/$ at the Central Bank of Nigeria.

He explained diesel was still being sold between N155 and N157 per litre at filling stations because the difference between the exchange rate of the dollar at the CBN and its value at the interbank market was about N20.

This amount, according to him, is always added to whatever is given by the PPPRA template as the MIBOM price and the cost is passed on to consumers.

He said, “Diesel has a peculiar template. The landing cost is around N108 per litre. But because we are using the official CBN exchange rate of N168 per dollar, and is deregulated, the CBN is obliged to sell the dollar at the official exchange rate. So the marketers have to go and buy at the interbank market.

“And the interbank rate is approximately N20 higher than the CBN rate. So, if you look at it, even though the template says it is N108, by the time they go to the interbank to buy at maybe N20 more, some of them will have to go and buy at the black market, which is around N210. So it is costlier and by the time it costs the importer N130 or N135 to bring in the product, the price moves up.”

Ahmed also said the activities of fraudulent dealers also warranted the increase in the price of the product, adding that some forms of racketeering of the product were contributing to the rise in cost.

While the agency blamed the high diesel cost on the current exchange rate, industry experts condemned the development, as they argued that deregulation of the product had not benefitted Nigerians.

The Chairman, Oil Trading Logistics Africa Downstream, Mr. Emeka Akabogu, said it was befuddling that more than the 50 per cent drop in crude oil prices had not reflected on the cost of diesel in Nigeria.

He said, “The bigger concern is that diesel is a deregulated product, and I have been one of the fiercest advocates for deregulation of petroleum prices in the last few years. Is there now cause to question the argument for deregulation?”

Figures from the PPPRA also showed that in January 2015, the international price of diesel averaged $445 per metric tonnes. A metric tonne of diesel could yield an average of 1,120 litres of the product, depending on the density of the particular specification.

The naira equivalent of this amount shows that the international price of diesel per litre was about N74 in the period under review.

When other costs like foreign exchange, freight, port and storage were factored, the landing cost of diesel in Nigeria per litre was between N85 and N90, while actual ex-depot price as of January averaged N95.50k.

Akabogu, therefore, noted that diesel was being sold at a minimum premium of N50 per litre in Nigeria.

He explained that this thrived in Nigeria because petroleum product marketers were often seen as a cartel of rampaging shylocks that would stop at nothing to make profit.

Akabogu said, “Competition seems meaningless in this context as obvious pricing agreements amongst retailers ensure that consumers are robbed of the benefits of a deregulated and potentially competitive market. Profiteering is the name of the game, and consumers seem helplessly at the mercy of its hard-nosed players.”

He faulted the Act establishing the PPPRA, stressing that it did not confer powers on the agency to rein in anti-competitive practices.

The Executive Secretary, Major Oil Marketers Association of Nigeria, Mr. Obafemi Olawore, also said the significant factor that had kept the price of diesel high in Nigeria was the exchange rate.

In a telephone interview with our correspondent, Olawore refuted the allegation that marketers were conniving to profiteer by exploiting consumers.

He said the value of the dollar against the naira had not been favourable to marketers.