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Heritage Bank Highlights Potential in Non-oil Exports

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Heritage Bank Limited has identified major commodities that can boost Nigeria’s foreign exchange earnings in the non-oil sector for the country.

Some of the export potential products as listed by the bank in the agriculture sector are: cocoa, cashew, groundnut, fish, horns, sesame seed, ginger, cassava and snails. Others include tobacco, coffee, cotton lint, rubber, among others. Under Vegetables and spices, the lender identified Bitter leaf, plantain flour, Ground melon, Ground Crayfish, Ground Maize among possible foreign exchange earners.

Managing Director/ Chief Executive Officer, Heritage Bank Limited, Mr. Ifie Sekibo said farmers and exporters of agricultural produce should seek more knowledge in order to increase the quality and quantity of their products because export business involves dealings with other world players.

The bank chief who spoke at the 2016 Annual Conference organised by Finance Correspondents Association of Nigeria (FICAN) in Lagos recently said the 10-year tenor export stimulation facility provided by the Central Bank of Nigeria (CBN) at nine per cent interest rate is a laudable incentive for exporters.

According to him, although the lenders would want the economy to grow by lending to farmers and other productive sectors of the economy, farmers/borrowers/exporters on their part should know that banks want their monies back and that “there is need for competence, commitment and confidence in the process.”

Speaking on the topic: “Providing Finance for Exports: Expectation & Experience,” Sekibo said Nigeria can also export such manufactured Goods as: Cocoa cakes, butter, powder & liquor, detergents, Malt drinks Palm kernel cakes & oil, baby clothes, confectioneries, leather. In the category of handicraft, Sekibo noted that Nigeria can export Talking drums, Calabash, Wood carvings, Raffia products among others, not forgetting the ever flourishing Nollywood which is even being watched by Militants (like Gendam) in neighbouring countries.

Represented by the Group Head, Agriculture Finance, Project & Development Finance Department of Heritage Bank, Mr. Olugbenga Awe, Sekibo regretted that exporters from Nigeria are not competitive enough, such that some Nigerian exporters go to Cameroun to bring in products, blend them to Nigerian products so that they can export. For instance, Yams that are consumed in London are from Ghana, not Nigeria.

As a country, Nigeria cannot afford to continue going backward in terms of non-oil export he reiterated.

The banker therefore advised exporters to master the steps to getting funding for export. He said, the first step is to know the difference between funds required for financing the business between the commencement of the manufacturing or procuring process and the dispatch of the goods, known as pre-shipment finance; and that of post-shipment finance, which are funds required for financing the exporter between the dispatch of goods and the receipt of payment.

It should be recalled that in recognition of Heritage Bank’s commitment to promoting non-oil export business, the African Export Import Bank (Afreximbank) recently provided a $150 million funding support for the lender.

Afreximbank, a frontline African financial institution believes in the uniqueness of the business strategy of Heritage Bank especially the Small Growing Business focus of the bank which aligns with the founding mission of Afreximbank.

According to Sekibo, exporters should also know that banks look for certain criteria for financing.

“There must be history of previous performance in terms of volume of export handled in the past; Frequency of Export; Payment methods; Payment Terms; how Products are sourced and how risk are mitigated,” he said.

Banks according to him also look at seasonality of the products; product destination; transaction cycle and buyer’s payment history.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Tony Elumelu Acquires Shell, Total, ENI Stakes in OML 17

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Tony Elumelu Acquires Shell, Total, ENI Stakes in OML 17

Tony Elumelu owned Heir Holdings Limited and its related company Transnational Corporation of Nigeria Plc on Friday announced it has completed the purchase of 45 percent stake in Oil Mining Lease (OML 17) through TNOG Oil and Gas Limited.

The acquisition includes all assets of Shell Petroleum Development Company of Nigeria Limited (30 Percent), Total E&P Nigeria Ltd (10 percent) and ENI (five percent) — in the lease.

It was further stated that TNOG Oil and Gas Limited will also have the sole right to operate OML 17.

The field presently has a production capacity of 27,000 barrels per day. Also, there are estimated 2P reserves (proven and probable) of 1.2 billion barrels and an additional one billion barrels in possible reserves — all of oil equivalent.

A consortium of global and regional banks and investors provided a financing component of $1.1 billion for the largest oil and gas financing in Africa in over a decade.

In a statement released on Friday, Shell said the completion was after all the necessary approvals have were received from authorities.

“A total of $453m was paid at completion with the balance to be paid over an agreed period. SPDC will retain its interest in the Port Harcourt Industrial and Residential Areas, which fall within the lease area,” the SPDC said.

Speaking after the completion of the deal, Elumelu said “We have a very clear vision: creating Africa’s first integrated energy multinational, a global quality business, uniquely focused on Africa and Africa’s energy needs. The acquisition of such a high-quality asset, with significant potential for further growth, is a strong statement of our confidence in Nigeria, the Nigerian oil and gas sector and a tribute to the extremely high-quality management team that we have assembled.

“As a Nigerian, and more particularly an indigene of the Niger Delta region, I understand well our responsibilities that come with stewardship of the asset, our engagement with communities and the strategic importance of the oil and gas sector in Nigeria. We see significant benefits from integrating our production, with our ability to power Nigeria, through Transcorp, and deliver value across the energy value chain.

“I would like to thank Shell, Total and ENI, for the professionalism of the process, the Federal Government of Nigeria, the Ministry of Petroleum Resources, and the NNPC for the confidence they have placed in us.”

Tony Elumelu is the Chairman of Heirs Holdings Limited, Transcorp and United Bank for Africa Plc.

Also, read Transcorp Plc Acquires FGN’s 100% Equity in Afam Power for N105 Billion

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Exporters Say CBN Pre-export Requirements is Frustrating Export of Goods

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Exporters Say CBN Pre-export Requirements is Frustrating Export of Goods

Exporters have said the recently introduced pre-export requirements by the Central Bank of Nigeria is creating unnecessary bottlenecks for exporters and the movement of goods out of the country.

Exporters, who spoke under the aegis of the Network of Practicing Non-oil Exporters of Nigeria (NPNEN), said the electronic Nigeria Export Proceed Form now required by financial institutions from exporters had come with so many challenges.

Ahmed Rabiu, the President, NPNEN, explained that the new policy had several requirements that often led to delays and loss of income on the part of exporters.

He said, “We acknowledge the CBN’s desire to ensure that all exports out of Nigeria are documented in order to ensure that the proceeds of such exports are repatriated.

“However, the reality on the field shows that the process is causing undue delays and consequently, encouraging corruption.

According to them, in the new pre-export requirements, the Central Bank of Nigeria wants an export transaction to be initiated through eNXP processing on the trade monitoring system.

After which exporters are expected to have a pre-shipment inspection agent, the Nigeria Customs Service and other designated government agencies carry out their pre-export inspections.

The exporters said the pre-shipment inspection agent was expected to issue a clean Certificate of Inspection while Customs would issue the Single Good Declaration. All these they said takes time and delay goods from leaving the country on time.

Pointing to a recent report, they said about N868 billion worth of goods bound for export were stuck at the ports due to the new policy.

Speaking further Rabiu said, “For example, for the PIA to issue the CCI, the exporter is required to upload a certificate of origin as one of the supporting documents for the eNXP.

“The PIA is also required to upload the CCI to the TRMS(M) and until this is done, the Customs service will not issue the Single Good Declaration.”

He added, “After issuing the SGD, the customs is further required to upload it into the TRMS before the goods are allowed to be gated into the port and loaded on the vessel by the shipping line.

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Ardova Plc in Talks to Acquire Enyo Retail and Supply Limited

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Ardova Plc in Talks to Acquire Enyo Retail and Supply Limited

Ardova Plc, Nigeria’s leading integrated energy company, has commenced discussions to acquire Enyo Retail and Supply Limited.

According to the statement issued and signed by Oladehinde Nelson-Cole, Ag. Company Secretary/General Counsel, Ardova Plc, Enyo is one of the newest and fastest-growing retail and supply companies in the downstream sector.

It stated, “This announcement is pursuant to the acceptance in principle of AP’s offer and acquisition framework by the shareholders of Enyo, it is subject to the successful completion of a due diligence exercise and the receipt of all required regulatory approvals.”

“This announcement is pursuant to the acceptance in principle of AP’s offer and acquisition framework by the shareholders of Enyo, it is subject to the successful completion of a due diligence exercise and the receipt of all required regulatory approvals.

Speaking on the yet to be completed deal, Mr. Olumide Adeosun, CEO, Ardova Plc, said upon completion, Ardova will retain the Enyo branded stations which will operate side by side with the Ardova brand while simultaneously leveraging on the strengths of Ardova and its group companies.

He added that the two companies are determined to conclude the deal by the end of Q1 2021.

Enyo presently operates over 90 stations across the nation and attends to over 100,000 retail customers on a daily basis.

Ardova Plc and Enyo Retail & Supply Limited promised to furnish stakeholders with more information on the progress of the deal.

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