Cyril Wily Matemela Ramaphosa is a titanic politician in South Africa, a labour Aristocrat, businessman and a very wealthy person amongst the people of the country. He was born in Soweto, Johannesburg on November 17, 1952. He attended the Universities of Limpopo, South Africa and studied law at the local Bantustan University, the University of the North (Turfloop), where in some years later became the theatre of violent clashes between the black African students and the apartheid state of South Africa. He was a committed student union activist until he became the Chairman of the local branch of the two black consciousness organisations, the South African Student’s organisation and the student Christian Movement in 1974.
In December 2017, Cyril Ramaphosa was elected as the 14th President of the African National Congress (ANC). He was elected the party’s Deputy President in 2012. In order to justify his quick ascendancy to political prominence, it is relevant to further delve into his political profile. Cyril was also the Chairman of the National Development Plan, the country’s establishment which defined the blueprint for growth towards 2030. He was the Secretary General of the biggest and most powerful trade union in South Africa, the National Union of Mineworkers.
Cyril Ramaphosa is credited to be a skilful negotiator who played a leading role as an ANC negotiator at the Convention for a Democratic South Africa (CODESA) who steered the political ship of the country from apartheid to democracy, and the sovereignty of the South African people, and especially the black race.
In 1994, he become a duly elected member of Parliament and Chairman of the Constitutional Assembly. He played a key role in drafting the country’s constitution. Ramaphosa also led the negotiations for a minimum wage. His failure to become Nelson Mandela’s deputy in 1994, was a mighty blow. He was however persuaded by Mandela to remain calm. Consequently, Ramaphosa went into business, which ranged from mining to fast foods. He floated a large investment Holding Company, Shanduka. The impressive success of the group confirmed his reputation as a skilled dealmaker and negotiator.
The period of his business venture spanned for a period of 20 years, during these years Cyril established deep links in the private sector in South Africa. The marvellous achievement set him at odds with sections of the members of the ANC who had the strong opinion that the post-South African apartheid regime delivered political power but not economic freedom. The opinions have become louder under President Jacob Zuma’s tenure with calls for radical economic transformation and action to tackle white monopoly capital. It is however the duty of Cyril to cope with these demands by implementing an all-inclusive social compact.
It is time to acknowledge the fact that Cyril Wily Matemela Ramaphosa as the leader and President of the ANC, shall all things being equal, automatically become the President of the Republic of South Africa. This is in view of the fact that there is not a single strong opposition political party in the country between now and 2019. It will then be time for him to exercise leadership, power, authority and influence, and to take tough decisions. The question is; will he be able to summon enough political will to cope with these teething issues of state and especially on how to wipe-out the President Jacob Zuma’s corruption legacies?
Subsequent development tended to suggest that Ramaphosa will either call the shots or that Jacob, as an ex-President in 2019 would bend over to lobby and win favour at Luthuli House, the seat power. Even to deliver this after election victory broadcast as leader of the ANC, it took a period of five clear days before Cyril was able to deliver it. It was an indication that some rough edges needed to be cleared, perhaps, by Jacob Zuma himself. Zuma’s shambolic nine-year rule as President is drawing to an ignominious end. The previous day, the ANC’s 86 strong National Executive Council told Zuma to resign his presidential post. In spite of this interim sack of the incumbent President, he is yet to comply in accordance with the ANC’s constitution.
To expect too much from Ramaphosa is to expect more than expected because it is unlikely that he will veer completely far from the traditional path of the ANC’s economic policy. It might be a herculean task for the new leader to confront this traditional blueprint. Ramaphosa is likely to emphasize stability in government and the ANC in term of economic rather than pursue radical interventions. It has been alleged by political commentators that parts of the state have been taken over by corrupt civil servants and some private sector interest, high levels of unemployment and increasingly fractions public debates.
How effective will Ramaphosa be in the running of the affairs of the country? Although he has been the Deputy President of the ANC and of the country for five years, a school of thought is of the view that his influence has been minimal and that he has not been able to stamp his leadership feet on the party or the country. Perhaps, his present leadership status of the party and his envisaged victory in 2019, will make a difference.
Looming job loss over upward review of excise duty
In March, the Minister of Finance, Kemi Adeosun, announced on behalf of the Federal Government that new excise duty rates have been approved for alcoholic beverages and tobacco with effect from June 4, 2018. According to the minister, the new excise duty rates were spread over a three-year period from 2018 to 2020 in order to moderate the impact on prices of the products.
She said the new excise duty regimes followed all-inclusive stakeholder engagements by the Tariff Technical Committee of the Federal Ministry of Finance with key industry stakeholders. According to her, the upward review of the excise duty rates for alcoholic beverages and tobacco was to achieve a dual benefit of raising the government’s fiscal revenues and reducing the health hazards associated with tobacco-related diseases and alcohol abuse. While the ideas behind the review are quite respectable, there also seems to be a lack of absolute comprehension of the economic consequences, especially in terms of jobs loss.
Unemployment rate in Nigeria, according to the National Bureau of Statistics (NBS), is currently over 18%, and with about 250,000 direct and indirect jobs set to be lost due to this new policy, things are only going to get worse and the pressure will spread out into the entire system.
The current excise at 20% for Spirits amounts to N31 per litre while the new one announced by the minister amounts to N200 per litre for spirits and N150 per litre for wines. This is over 500% increase at a go, by far the highest within the subsector.
The excise duty currently paid by the Wines & Spirits Sector stands at 20% across board, while under the new approved excise duty tariff, it is fixed at 67% for the wines and spirits sub-sectors respectively.
The spirits and wine subsector represents 6% by volume of the alcoholic beverages sector and is dominated by local distillers, the group that will be most affected by this decision. Checks revealed that the data used in computing the recently approved excise tariff were largely luxury foreign products to which excise tariff will not apply like it will on the fledging but largely underdeveloped local subsector. Domestic spirits production is dominant in Nigeria, accounting for an average of 53% of spirits consumption over the 2012 to 2016 period.
With an investment of about N420 billion, it will be Nigeria’s loss if this industry is crippled, and even worse for those whose source of livelihood will be cut off. While the industry remain fragile, local distillers have recently made significant investments to grow capacity as well as achieve backward integration, but all that is at the danger of being washed away by this latest astronomical increase in excise duties which many have said to be inconsiderable.
Contrary to the minister’s claims, neither the Distillers and Blenders Association of Nigeria (DIBAN) nor the Manufacturers Association of Nigeria (MAN) confirmed that they were consulted before the decision was taken.
The economic impact of such drastic decision is well known to everyone. The jobs of over 250,000 Nigerians will be in jeopardy and consequently, family cohesion, social stability and economic wellbeing of at least five million people will be threatened. The astronomical increase in tariffs on locally produced goods such as spirits and wine is a systematic way of destroying credible local distilling industry with the implication of unleashing avalanche of illicit and unsafe drinks on the Nigerian masses.
The danger of increasing the restiveness and disgruntlement of a citizenry under enormous socio-economic pressure as we approach the 2019 general elections can only be imagined. According to Lateef Oyelekan, President of The National Union of Food Beverage and Tobacco Employees (NUFBTE), the union had written the Minister of Labour and Employment, Senator Chris Ngige, on the implications of the new tariff, which may further exacerbate the problem of unemployment in the country, and that the drive towards foreign direct investment would be jeopardised as no investor would like to invest in an economy with low return on investment.
“Our employers have already notified us that it would lead to shut down of some of their companies. What government should be doing is to come up with policy that will discourage employers from downsizing, but before they can do that, tariff has to be reasonable. “This new policy of the government will increase the cost of production and if that happens, the employers would have to look for a way of cutting cost, and workers are always the first option,” he said.
According to him, the union, in a bid to register their displeasure, has also vowed to down tools soon. A study on Excise Duty Changes for Spirits and Wine conducted by KPMG also revealed that given the challenges of border control and the illicit market, price increase driven by higher excise duty rates may also result in loss of government revenue. This means that even jobs that are un-associated with the distilling industry can become affected by this decision.
If anything, the government should at this time be encouraging local industries through provision of enabling infrastructures and reasonable excise duty rates that can enable them to flourish and affect the worrisome unemployment rate in the country.
•Mr. Obayuwana, an industry expert, writes from Abuja.
The evolution of Ebonyi charter of equity
One of the greatest fallacies I have heard in recent times is that Ebonyi State has no written charter of equity depicting modalities for the rotation of political positions especially the seat of the governor among the three senatorial districts. But the big question every Ebonyi man/woman needs to answer now is: Assuming without conceding that there is no written charter of equity for power rotation among the senatorial districts in Ebonyi State, is a charter of equity not necessary in Ebonyi State even now? What will it cost to make one?
The naked truth is that a charter of equity for power rotation is so necessary in Ebonyi State that if there is none, one should be invented! I come from Effium community, which has been at the receiving end of injustice and inequity from the rest of Ohaukwu for close to half a century; and I know that nothing is more abhorrent than injustice and inequity.
Having said this, let us examine the claim which forms the major thrust of this piece: Has Ebonyi State a written charter of equity for the rotation of the governorship position among the senatorial districts? If the answer to the question under review is in the affirmative, where was it written and who endorsed it? The search for the answers to these core questions, compels a detailed study of the key word “written”!
A thing is written when it has been reduced into writing in contrast to verbal or oral form. Simply put, to write means to inscribe letters, words or symbols on a surface for the purpose of communication.
In the Bible, God wrote the Decalogue on stones. After some time, God in His omniscience decided that important documents like His commandments are better written on durable and better medium other than stones which can be broken like we saw in Exodus 32:19. In Jeremiah chapter 31 verses 33 to 34 and Hebrew chapter 10 verse 16, God promised a new covenant which would be written in the hearts of His people.
By that token, it suffices that the heart of man is a better medium for writing solemn charters. Ebonyi people and the rest of the world are in the era of that new covenant! At this juncture, let us pit the questions before us against the prism of historical facts in the hope of unravelling the answers: The truth is that from the onset, it was not the intention of the founding fathers of Ebonyi State to have a state where one section or senatorial district would be marginalized in whatever form. This was why the Movement for the Creation of Ebonyi State constituted a committee on Charter of Equity as one of its strategic committees on October 2, 1994.
The committee headed by Chief Celestine Okeagu Ogada drew up the charter of equity for Ebonyi State which was submitted to Ebonyi founding fathers under the aegis of Ebonyi State Movement on July 21, 1996. That the charter of equity was not signed due to the selfish and intransigent postures of Ebonyi elites did not in anyway constitute a derogation on the necessity or authenticity of that very charter of equity in Ebonyi State.
In my essay, Ebonyi 2019: A prophecy of what Ebonyi people will do in fact, I submitted that: “Ebonyi masses have been and continued to be the conscience of Ebonyi State; it is their resilience that has bequeathed us with the pride we have as a people and truly earned us the label of ‘a people of honour and integrity’! This is contrary to the character of majority of our elites who have often pursued their personal interests/ambitions beyond bounds and at the expense of our common good.”
This humble but considered submission is true even in this matter under review. When the democratic processes presented its opportunities, Ebonyi masses rose to the occasion by enforcing the contents of the unsigned Ebonyi Charter of Equity on power rotation by voting for an Ebonyi Northerner, Dr. Sam O. Egwu, in 1999 as the pioneer elected governor of Ebonyi State.
This was in line with the contents of the charter of equity which had specified that Ebonyi North which hosts the state capital should take the first slot in the governorship of the young state. In 2003, Ebonyi masses ignored the desperation of some selfish Ebonyi elites who constituted themselves into the notorious Abuja Group and voted for Dr. Egwu to enable him consolidate on his achievements and complete most of his projects.
In 2007, Chief Martin Elechi, a man from Ebonyi Central who was part of the struggle for the creation of Ebonyi State, took over from Egwu. Elechi allegedly ran a biased and unbalanced administration characterized by avoidable wars and inequitable siting of projects. Confronted with an impending electoral defeat in 2011, the old man chose Engr. David Umahi who was undoubtedly Ebonyi goodwill ambassador as his running mate.
For this reason and the fact that Elechi’s predecessor had taken two unbroken tenures, Ebonyi people voted him into power for the second term in the hope that Elechi will complete his projects for whatever they were worth.
Unfortunately, many of those projects were not just uncompleted in 2015; most of them like Ebonyi power projects were equally discovered to be both ill-conceived and unviable! When it was the turn of Ebonyi South to produce the Governor of Ebonyi State in 2015, the then governor with some members of Ebonyi elite club foisted a curious political imbroglio on the state in the hope of derailing the successful evolution of Ebonyi charter of equity on power rotation by denying Ebonyi South their turn to produce the Governor of Ebonyi State.
Again, Ebonyi masses resisted the old man and his elite cabal by voting for Engr. David Nweze Umahi who personified justice and equity in the 2015 election. It is instructive that through their voting pattern over the years, Ebonyi people have proved that Ebonyi charter of equity on power rotation is boldly etched on their hearts and endorsed in their heartbeats! We have seen in Jeremiah 31:33-34 and Hebrew 10:16 that the heart is the best medium for writing solemn or sacrosanct agreements, covenants or charters! It suffices that Ebonyi State has a charter of equity which stipulates rotation of the governorship position of the state among Ebonyi North, Ebonyi Central and Ebonyi South senatorial districts in that order.
The second clause of this solemn charter which is coordinate with the first clause is that each of the occupants of the seat has a right to two unbroken tenures. I dare to add that Apostle Umahi who has in three years achieved more than any governor in the history of democracy in Ebonyi State deserves not just an unbroken second term: He equally deserves an unopposed second term come 2019! It is well with Ebonyi State!
•Eze writes from Abakaliki, Ebonyi State.
Fractionalizing the power supply industry
From the times of NEPA, meter has been an apple of discord in Nigeria. The Federal Government connived and the monolith became a law unto itself. Against the previous practice, it decided that customers should be paying for meters. Unhappily, most customers paid for several years, but many paid NEPA back claiming ownership and doing what they liked with meters. Revenue insecurity had begun and NEPA was in tatters.
Many years later, NEPA decided that customers should pay monthly charge for meter maintenance. However, it did no such maintenance. Many Nigerians were scandalized and they said so in newspaper articles. I challenged NEPA and the FGN in an article of eponymous title in my weekly column, Public Utilities Watch, in the Vanguard on March 11, 2003.
Electric power supply authorities have turned their backs on illegalities in the management of electric power in Nigeria for so long, they have, themselves, begun to create situations as defiant and disruptive of norms, as illegalities often are.
Let us look at the @NERCNG tweets – “The payment of metering service charge by the customer to the MAP shall cease upon full amortization of the meter asset over its technical life.” It talks of payment of a metering service charge. That is new. NERC had previously warned DISCOs not to charge for meters. And that was right because meter cost has always been part of monthly electricity rates that customers paid. For many years, that had amortized the meter cost over the service life of the instrument.
Clearly, Meter Assets Providers (MAPs) are, by the second @NERCNG tweet – “Where a customer elects to pay in full up-front for a meter under MAP, he/she shall be exempted from the payment of metering service charge” – to charge for meters throughout the service life of the instruments as well, although as meter service charge to the customer. That means that the MAPs have to prepare own bills, and customers have to pay to two, instead of one server. I argue that that will create a higher cost situation that will make rate hike inevitable.
The most challenging aspect of MAP, though, is that it is not specified in terms of sustainable infrastructure and technology, as well as finance. It will take Nigeria back to the mid-1960s. Then, meter touts swarmed the ECN with notes from some members of the Board of Management. But the corporation was up to the challenge. It had sent an engineer and three meter technologists to Uher in Vienna, Austria, for a three-month course in meter manufacture and testing. Through thorough testing and inspection, it was able to do away with the worst credit meters ever imported to this shore. How will Nigeria handle a similar situation today?
Nigerians usually do well at hawking anything. However, goods bought are sustainable only when backed by expert after-sales service. Sustainable infrastructure and technology would guarantee that for Nigeria. Without it, DISCOs would be better if they share meter maintenance technology directly with the meter manufacturers.
I warn that meter assets go far beyond the meter itself. Executive capacity, maintenance workshops and test laboratories are mandatory. It includes the ability to provide and test current and voltage transformers as accessories to industrial forms of metering, which must be tested along with those accessories. Remember that meters are the DISCO’s only true vehicles to legitimate revenue; and DISCOs are safer and better using their own meters!
Nigeria’s meter challenge evolved over more than 40 years. In a dynamic industry and situation, it is ludicrous to throw a fire brigade solution at it. Indications are that the country has more unmetered, than metered customers. Added to that, will be several new customers as well as old ones with obsolete meters to be replaced from time to time. And all of that against a backdrop of lean financial resource, desperate distribution networks to put right, and a deficit of technology as well as of executive capacity.
Clearly, this is an issue to last 10 to 12 years of organised effort. There should be annual budgets for meters and technical training, to increase meter availability and increase executive capacity. Done that way, Nigeria does not need to create a new class of licensees, such as MAP.
Besides, MAP, a clumsy attempt at solving an extant problem that is not clearly understood, creates more problems and solves none. Together with approved customers, they fractionalize the industry, and increase the per capita cost of the common facilities left to a reduced population, and a poorer load factor. And inevitably, rates must increase to barely sustain the industry. That is unhealthy for Nigeria’s electric power supply.
•Engr. Uwaifo writes in from Lagos
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