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Telecoms Subscribers to Get Poorer Services as Vandalism Rises

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  • Telecoms Subscribers to Get Poorer Services as Vandalism Rises

Frustrations being experienced by telecoms subscribers on account of poor services will increase even further, if the activities of vandals, which seem to be on the upward swing in Nigeria’s telecommunications sector are not checked.

This is even as operators continue to witness increasing fibre cuts and theft of infrastructure, especially their generating sets and diesel, which they use to power their base stations.

The increasing act of vandalism is impacting negatively on the quality of telecommunications services across the country, with the resultant effect being high rate of drop calls, higher calls terminations, undelivered text messages, poorer networks connectivity and a host of others.

The Guardian reliably gathered on Tuesday that fibre cut menace increased by 60 per cent in 2016. Besides, about 10,000 generating sets were said to have been lost to miscreants in the year. In 2015, report had it that the industry recorded about 1,200 fibre cuts.

While the industry still grapples with shortage of Base Transceiver Stations (BTS), which is currently put at 29,000 and spread across the country, The Guardian gathered through the Association of Licensed Telecommunications Operators of Nigeria (ALTON), the industry’s network of over 25,000 BTS spread across the country is powered with about 50,000 generating sets.ALTON is the industry body for all telecommunications companies and service providers.

The Guardian gathered that a direct operator, like MTN, Globacom and others, use a 15-20KVA generating set, while those on co-location run a 27KVA set, which are changed sometimes every two years depending on wear and tear forces.

The Nigerian Communications Commission (NCC), the industry regulator, had at a forum in December 2014, disclosed that the sector was home to 29,000 BTS, and noted that it was abysmally low to carry the traffic on the various networks.

For effect, NCC declared that the country needed about 80,000 BTS to meet growing telecommunications service demands across the country.Further investigations showed that telecoms operators, who do not rely on Power Holding Company of Nigeria (PHCN) for electric power to run their BTS, fully relied on their generating sets. Each has two generating sets, with one as standby.

As such, based on the arrangement, telecoms operators usually have challenges of poor service quality as a result of the activities of the miscreants, which lead to service disruptions and downtime on various networks.A source in MTN Nigeria, told The Guardian that the firm had since the beginning of the year being coping with two fibre cuts on a daily basis across the country.

MTN, which has about 65 million subscribers, said that Boko Haram, the extremist Islamic sect, had destroyed 120 of its sites between 2013 and 2014. The company had at a recent function declared that at least 80 sites were destroyed during the last quarter of 2014.

During a working visit of the Minister of Communication, Adebayo Shittu, to MTN Head Office, in Lagos, a former Corporate Services Executive, MTN Nigeria, Amina Oyagbola, had solicited government’s support to address the monster of infrastructure vandalism to further improve service delivery to end users.

A telecommunications expert, Kehinde Aluko, said the increasing menace of vandalism has become a dent on the success of the sector.He stressed that this development has also limited many telecommunications operators from completely implementing outlined network expansion initiatives in the country, amid rising cost of doing business in an industry that is heavily dependent on foreign exchange and capital.

At forum earlier in the year, the Chief Executive Officer, Airtel Nigeria, Segun Ogunsanya, claimed that Nigerian operators spend between $3 billion and $4 billion as capital expenditure yearly on network expansion initiatives.

He explained that if vandalism of telecoms equipment and installations continued unabated, Nigerian subscribers could experience higher frequency of dropped calls, incoherent transmission and undelivered text messages.

“Two per cent to three per cent of Nigeria’s telecoms sites are affected by random shutdown and destruction at any given point in time,”added. Experts are of the view that the current situation has been exacerbated by the failure of the National Assembly to pass the Critical National Infrastructure Bill.

The bill, if passed into law, will criminalise any act of vandalism of telecoms equipment, since they will be classified as critical national infrastructure.

According to Chairman of ALTON, Gbenga Adebayo, stressed that inadequate power supply and insecurity; vandalism; multiple taxation and regulation among others have impacted seriously on the fortunes of the industry.

Adebayo said telecoms infrastructure should be seen as critical equipment just like the oil pipelines, as well as PHCN and NITEL (Nigerian Telecommunications Limited) facilities.

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 long experience in the global financial market.

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Investment

Barclays Tell High Net Worth Investors to Shun Africa and Other Emerging Economies

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Barclays to High Net Worth Clients, Stay Off Africa and Other Emerging Economies

Barclays, one of the world’s largest investment banks, has started advising high net worth clients to stay off Africa and other emerging economies.

According to Barclays, despite the recent recovery noticed in emerging-market stocks, investors are better off avoiding the risks that still abound in emerging nations. Barclays Plc, however, advised high net worth clients to focus on U.S equities despite the S&P’s breakneck rally.

The investment bank said emerging economies do not have enough fiscal buffers to spend their way out of the COVID-19 pandemic and will likely continue to struggle in the near-time compared to the US with 12 percent of gross domestic product fiscal-support.

It said the huge US stimulus may halt rebound in emerging-markets stocks as more money is expected to flow into the world’s largest economy and its European counterparts.

“Compared to the U.S., emerging-market economies appear more vulnerable,” said Haider, the London-based managing director and head of global growth markets. “Their central banks have less room to maneuver, their governments may not be able to provide unlimited support and equity markets, given their sector mix, can be more challenged by an economic slowdown.”

Barclays added that even after 33 percent rebound in stocks of emerging markets since the panic selloff subsided in March, stocks are still down by 9 percent from year-to-date while the US S&P 500 stocks are up by 45 percent. Presently, their stocks trading at a 36 percent discount to US stocks, up from 25 percent three months ago.

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Economy

Crude Oil Rises to $43.1 Per Barrel on Production Cuts Extension

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  • Crude Oil Hits $43.1 Per Barrel Following OPEC’s Production Cuts Extension

Brent crude oil, against which Nigerian oil price is measured, rose by 1.25 percent on Monday during the Asian trading session following OPEC and allies’ agreement to extend crude oil cuts to the end of July.

OPEC and allies, known as OPEC plus, agreed to extend production cuts of 9.7 million barrels per day reached in April to July on Saturday.

In the virtual conference, delegates agreed that members, including Nigeria and Iraq presently struggling to attain a 100 percent compliance level must keep to the agreement or be forced to do so in subsequent months.

Nigeria, Iraq and others failed to keep to the cartel’s agreement in May after reports show that Nigeria only managed to attain a 19 percent compliance level during the month while Iraq struggled to attain just 38 percent in the same month.

Russia and Saudi Arabia, the two largest producers of the group, warned members to stick to the agreed quota if they want to rebalance the global oil market.

While the errant producers such as Iraq and Nigeria have vowed to reach 100% conformity and compensate for prior underperformance, we still think they will likely continue to have some commitment issues over the course of the summer,” said Helima Croft, head of global commodity strategy at RBC Capital Markets.

The potential return of Libyan output could also cause considerable challenges for the OPEC leadership.

Earlier on Monday, Brent crude oil hits $43.1 per barrel, more than a month record-high, before pulling back slightly to $42.83 per barrel.

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Economy

Gold Dips by 2 Percent on Better Than Expected Job Report

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  • Gold Dips by 2 Percent on Better Than Expected Job Report

Gold prices declined by 2 percent on Friday following a better than expected US non-farm payroll report.

The report showed an increase of 2.5 million payroll numbers against a decline of 7.5 million predicted by many experts.

The surprise number boosted investors’ confidence in US recovery as many dumped their haven investment (gold) for the stock market.

“We had significantly stronger-than-expected U.S. payroll numbers – an increase of 2.5 million versus an expectation of a decline of 7.5 million – that 10-million swing has brought forward expectations of the economic recovery in the United States,” said Bart Melek, head of commodity strategies at TD Securities.

Spot gold immediately declined by 1.9 percent per ounce to $1,678.81 while the U.S. gold futures slid 2.6 percent to settle at $1,683.

Gold was also being pressured by stronger yields and a slightly firmer dollar, “meaning the opportunity cost to hold gold in the portfolio has gone up,” Melek added.

The surprise didn’t stop there, US Dow Jones was up 614 points despite the protest going on the US and US-China tension.

Also, NASDAQ rose by 29 points while the S&P index added 50 points increase.

Note: Investors generally increase their investments in gold and other haven assets during a crisis to avert risk exposure and do the opposite once they sense a better economy.

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