• Chinese, Nigerian presidents satisfied with bilateral ties • Pang Yuliang Acquired German Parchim Airport

telecommunications services.
The Commission has a vision of an information rich environment, comparable globally in quality telecom service provision, regulated by a responsive, world-class organization with a mission to support a market driven telecommunications industry and promote universal access. It hopes to achieve this through the consistent enforcement of clear and fair policies that protect stakeholders, ensure efficient resource management, share industry best practices and deliver affordable, quality telecom services.
In a bid to facilitate entry into the telecommunications market in the country and ensure that Nigeria becomes an information-rich society, NCC recently reviewed its licensing policy by adding new services to its Class licence category.
The NCC in a statement stated said the review is in addition to the existing class licenses like Payphone, Cybercafe and Telecentres, adding that interested parties willing to participate in the provision of telecommunications services in Nigeria can obtain information on License Requirement & Procedure, Deregulated Services, Post License Award Evaluation, Application Form, List of Licensees, Fee Structures and Auctions.
The Commission had recently pegged the Reserve Price for the licensing of 3G spectrum license at $150 million through an auction process in order to promote competition and ensure fairness.
The spectrum blocks to be made available for auction include the 40MHz of spectrum within the 2GHz band. The Commission will offer this spectrum as four paired blocks of 10 MHz. Spectrum pairs will be separated by a 90MHz duplex spacing. Blocks will be allocated as follows, Block A:1920-1930MHz paired with 2110-2120 MHz, Block B: 1930-1940MHz, paired with 2120-2130MHz,Block C: 1940-1950, paired with 2130-2140MHz and Block D: 1950-1960MHz paired with 2140-2150MHz.The statement added that "Spectrum will be allocated on a service and technology neutral basis without the specification of guard bands. Licensees will be required to co-ordinate spectrum use to avoid interference".
The NCC however reiterated that participation in the auction process will be limited to existing Nigerian Licensed Network Operators only. The Licences include, the following classifications: Universal Access Service Licence (UASL), Digital Mobile Licence (DML), Fixed Wireless Access (FWA) Licence,Long Distance Operator License, National Carrier Licence and Private Network Links Licence.
However, applicants, according to the NCC, will not be required to submit financial or technical plans in the pre-qualification process, except details of company ownership structure and confirmation of compliance with the rules of the auction. To participate in the auction, a bidder must be a limited liability company incorporated in Nigeria and must not be involved with any other bidder.
A Consortia, according to the statement, may bid for a licence subject to the requirement that they include a Nigerian telecommunications licensee. Bidders will also be required to lodge a USD $15 million (i.e.10% of Reserve Price) Intention to Bid Deposit with the Commission.
To ensure that consumers get good value for their money, the Consumer Affairs Bureau of the Nigerian Communications Commission (NCC) was established in September 2001, to inform, educate and protect all the consumers of telecommunications services in Nigeria.
The aim is to create a visible and credible Consumer Affairs Bureau that would serve as a One-Stop-Shop which stakeholders can rely upon for information on the telecommunications industry in Nigeria.
To generate an unmatched awareness of consumer rights in Nigeria by establishing a strong bureau that would monitor and control telecommunications operators in Nigeria in order to protect consumers from unscrupulous practices in the industry.
To innovatively exploit all channels of communication in offering education to the subscribers on a continuous basis.
To be able to perform this function effectively, NCC created a Call Center (Help-desk), managed by Consumer help-desk Specialists, who will courteously respond to inquiries, investigate and solve complaints in a professional and efficient manner. If the help-desk specialists are not able to solve the compliant, the consumer may be requested to make a formal complaint in writing, which would then be assigned to an officer of the Bureau who would contact the service provider and resolve the problem.
The Constitution of the Federal Republic of Nigeria expressly provides for a number of rights, which are recognised as inalienable to every citizen of the country. The Consumer Affairs Bureau of the NCC has also listed some rights which every consumer is entitled to, irrespective of his or her status in life. These rights are called 'Consumer Bill Of Rights'. They include the The Right To Be Informed, The Right To Safety, The Right To Choice and, The Right To Be Heard.
NCC believes 'The customer is always right' therefore, it is incumbent on all providers of telecom services to respect and uphold the rights of the customer.
CEO of the Year/Entrepreneur of the year Awards: Dangote: a Double Victory for Africa's Biggest Industrialist
Forget the South Africans made rich by Black economic empowerment. Stand aside North Africans who are one-day Arabs, the other day Africans. Whether you go east or west, Aliko Dangote stands tall as one of Black Africa's first authentic billionaires who built his empire from ground up, brick by brick. Next month, on his 50th birthday, on April 10, Dangote will formally open his $2 billion cement factory in Obajana, Kogi State. Complete with a 10km rail link-up to deliver raw materials to the manufacturing plant, gas and awesome infrastructure. Obajana stands out in the middle of central Nigeria
He has been acclaimed globally as one of the greatest entrepreneurs ever to emerge from the shores of the African continent and, like a colossus, Dangote bestrides the nation's business terrain with remarkable investments in virtually all sectors of the economy including manufacturing, merchandising, haulage, banking, insurance and property development. Indeed, in the history of Nigeria's corporate existence, Dangote stands out as an entrepreneur of note whose remarkable achievements to date represent the hallmark of perseverance and the spirit of great enterprise.
He was born into a family of merchants in Kano in 1957. His father died when the Aliko was an infant. The responsibility of his upbringing and training naturally fell on his grandfather, Alhaji Sanusi Dantata, a humble and affluent Kano businessman. Dangote attended the Kano Capital School, Kano, and Birni Kudu Secondary School in the present day Jigawa State. He later proceeded to Al--Azahar University in Cairo, Egypt, where he graduated in Business Studies.
As a young boy, he had been involved in trading, as petty as it could be. He would buy packets of sweets and give to one of the househelps to sell for him. He was doing it discreetly, and he had some pocket money to play around with as proceeds from his enterprise. Even then, he chose to re-invest the money in the business. Who would have known that a super businessman was budding then?
As if to confirm his dream that young Dangote was carrying the star of fortunes and virtue as pure as grace, Dantata in 1977 gave his grandson a small loan to trade in cement and to repay it in two years. Dangote exhibited his business acumen derived from his studies and natural endowment and shocked Dantata by repaying the loan in three months. Thus, Dantata was convinced that nature had shaped the origin and indeed determined the fate and future of his grandson.
That prediction by Dantata over two decades ago, has become a reality, as his grandson, Dangote, today presides over the affairs of Dangote Group of Companies, clearly one of Africa's largest and most diversified business conglomerates, with a hard-earned reputation for excellent business practices and product quality.
The group has carved a niche for itself in the areas of manufacturing, imports, exports, and commodity trading and property development. To support the group's core business activities, it has set up one of the most extensive distributions networks in Nigeria consisting of regional offices and a fleet of over 1,600 tractor-trailers.
Some companies under the Dangote conglomerate include: Dangote Nigeria Limited; Dangote Industries Limited; Blue-Star Services Company Limited; Dangote Agro-Sacks Limited; Dansa Food Limited; Nigerian Textile Mills Plc; Dangote Textile Mills Limited; Dangote Ginnery Limited and Nasal Insurance Company Limited. Others are Alsan Insurance Brokers Limited; Greenview Development Co. Limited; Blue-Star Shipping Co. Limited; Blue-Star Investment (U.K.) and Greenview International Co. (Ghana) amongst other.
Because of the kind of positive business orientation he has, Dangote for the past 22 years has driven Dangote Group to experience phenomenal growth resulting from the quality of its goods and services, its focus on customer care and efficiency of its human capital. Thus, from a modest beginning, Dangote Group has grown into a multi-billion naira industrial conglomerate. No wonder he is indeed, a testimony to the success and reward of private entrepreneurship.
While recognising and understanding the constraints of operating in a developing economy such as Nigeria, Dangote, and his business has remained committed to creating and sustaining excellence in the Nigerian economy. In consonance with its commitment to world-class customer care and service, the group is continually investing in qualified and professional staff and information technology (IT) network to ensure that these high level of service is carried through into a market place that is becoming more and more sophisticated.
Dangote believes that part of his success in business is his adherence to strict business principles, which he brought to bear on his exploitation and investments in the different sectors of the economy, thereby contributing immensely to both human and national development. Contemporarily, Dangote Group employs more than 10,000 people while also providing secondary employment opportunities to several millions of Nigerians nationwide. With a potential annual turnover in excess of N170 billion, the group pays annually over N6 billion custom duties/taxes to the Federal Government in addition to more than N4 billion as rent and other port charges to the Nigerian Ports Authority.
Beside the sugar refinery in Lagos, which produces one million tones of refined sugar annually, being 65 per cent of total sugar requirements in Nigeria, the group acquired Savannah Sugar Company in Numan, Adamawa State, as part of its backward integration programme. The Flour Mills in Lagos, Kano and Calabar have a total milling capacity of one million metric tonnes of wheat annually, with plans to increase capacity by an additional 300,000 metric tones before 2004. The increase in capacity is due to expansion in Kano and a new mill in Ilorin. The spaghetti and macaroni plant in Lagos produces 100,000 metric tonnes (i.e. 10 million cartons) per annum. In addition, the group's salt plants located in Lagos and Calabar have a total production of 400,000 metric tonnes of iodised salt annually, while plans have been concluded to establish an additional plant in Port Harcourt.
Dangote, who is fondly referred as Mr. Cement by friends, has upgraded the group's bulk cement import terminals with facilities in Lagos and Port Harcourt to pack about four million metric tonnes per annum, being 40 per cent of the cement market in Nigeria. The total capacity for the terminals is 8 million metric tonnes annually. Dangote Group is expanding its business outside Nigeria by establishing cement terminals in Tema and Takoradi both in Ghana. The annual capacity is in excess of two million metric tonnes.
As part of its backward integration programme designed to boost local production of high quality cement in Nigeria, the Group will formally open its Obajana Cement Factory in Kogi State, in April 10. It has a production capacity of five million metric tonnes. The group is working in concert with the Associated Cement Company of India to resuscitate and reposition Benue Cement Company (BCC) where Dangote Group has acquired majority shareholding; this is without the opposition of some groups, especially Benue State indigenes. On this opposition, Dangote took everything in his stride. He never rushed into any hasty action that would jeopardise the peaceful resolution of the issue; rather, he allowed tempers to cool. In his amiable manner, he took the behind-the-scene option by negotiating his way through. The result is that the same governor who initially opposed the idea of non-indigene participation in the privatisation process of the BCC, now wholeheartedly accepts the new reality, which he now believes to be in the best interest of everybody. Dangote's quiet diplomacy and shrewd negotiating skill has triumphed over emotions and sentiments.
This is not to say that he was not frustrated at a point in the buying process of BCC. In a recent interview with THISDAY, Dangote expressed regret at buying the company. He regretted it because he never thought that the Benue indigenes would be hostile to his effort. He, however, said that the Benue experience would not deter him from investing in any other part of the country. "The reason is simple. I do not believe people in other areas would think or react like the Benue people," he explained.
The planned production capacity for BCC today is three million metric tonnes annually. Dangote Group is preparing Ibese Cement project in Ogun State and Odukpani Cement project in Calabar, with each plant having a capacity of 2.5 million metric tonnes per annum. When completed, the two projects would bring the group's total production of cement to about 12 million metric tonnes per annum.
The man Dangote has his hands in every business pie. Property development is not out of it. In consonance with government's housing policy, Dangote Group has constructed 41 bungalows in Kano and various grades of residential executive apartment complexes in Lagos and Abuja. He also has stakes in Nigeria Textile Mills, Lagos which is undergoing strategic restructuring and repositioning in line with corporate policy of meeting the growing demand for locally manufactured textile products. Dangote Textile Mills in Kano currently produces seven million metres of textile materials annually. He also seats on the board of some local banks.
Dangote is one of the few businessmen currently riding high on the crest of the variant of economic nationalism doctrine being pursued by the President Olusegun Administration. This is on the background of the belief of some people that the present administration is pursueing an economic agenda that is a cross-breed between Margaret Thatcher's idea of capitalism propelled by some super rich entrepreneurs who are to form the nucleus of the new enterprising private sector.
It is no surprise that Dangote therefore believes so much in the present Nigerian economy. For him, the economy is on the right track even when the other segments of the society are crying of hardship. "Now matter what, people will still cry," he said, but then agreed that "though there is no money, government has given a lot of incentives, which people may not be mindful of. For instance, if you are starting a new business, you have a pioneer status and about five to seven years tax free period, depending on which location you are going to set up."
Banker of the Year: Jim Ovia: Banking's New Elder Statesman
With the exit of veteran bankers like Chief Joseph Sanusi who later headed the Central Bank of Nigeria (CBN), Otunba Subomi Balogun and Chief Paschal Dozie from core banking operations, Jim Ovia is now the most qualified to be refered to as the new statesman of the banking industry. Perhaps, top bankers like Atedo Peterside and Erastus Akingbola can match Ovia's 18 years as Chief Executive Officer. However, the conferment of the Banker of the Year Award on Zenith Bank's CEO in the 12th THISDAY Annual Award for Excellence and Good Governance due to the excellent performance of his bank has confirmed the first class banker as the new elder statesman of the nation's financial circle. Ovia is the Chairman of the Nigeria Software Development Initiative (NSDI) and also Chairman, National Information Technology Advisory Committee [NITAC]. He is also a member of the Governing Council, Nigerian Investment Promotion Council [NIPC] and member of the Honorary International Investor Council.
A member of the Governing Council of Lagos State University, Lagos and also a member of the Board of Trustees, Redeemer's University For Nations, Lagos, Ovia is also the proprietor of the proposed University of Information and Communication Technology, Agbor, Delta State. He served on the board of American International School, Lagos [2001 -2003].
The Zenith Bank Plc. boss headed various Non-Governmental Organisations [NGO] at various times including being the first President of the Nigeria Internet Group [2001-2003]; member, Tsunami Disaster Relief Committee and co-ordinator, Nigerians United To Save Niger Republic [NUSAN].
Ovia is the founder and chairman of Mankind United to Support Total Education (MUSTE), a philanthropic organization focused on providing scholarship for the less privileged, of which some of the beneficiaries are now qualified medical doctors, lawyers, engineers etc.
He is also the founder of the ICT Foundation for Youth Empowerment, which focuses on improving the socio-economic welfare of Nigerian youths by inspiring and motivating them to embrace Information and Communication Technology. The initiative holds annual Youth Empowerment conferences.
In November 2000, Jim Ovia was conferred with the national award of Member of the Order of the Federal Republic (MFR) by the President, Federal Government of Nigeria. He had earlier received the Zik Award for professional leadership in April 1999. He was also conferred with the honorary degree of Doctor of Science [D.Sc) in Finance by the Lagos State University in October, 2005.
In educational attainment, Ovia has a Master's degree in Business Administration from the University of Louisiana, Louisiana, USA in 1979 and a B.Sc degree in Business Administration from Southern University, Louisiana, USA (1977). He is also an Alumnus of Harvard Business School (Executive Management Program).
He is a motivational speaker and has delivered speeches at several conferences. He has authored several published and unpublished works and he is in the vanguard of promotion and propagation of Information and Communication Technology in Nigeria.
Bank of The Year Award: UBA: CONSOLIDATING LEADERSHIP With N1trn BALANCE SHEET
The United Bank for Africa Plc, UBA, was last weekend voted as Nigeria's 'Bank of The Year', at THISDAY's Award 2007. It could not have been otherwise. The bank has come a long way and is today the largest financial services institution in West Africa with a balance sheet size in excess of N600 billion (under USD5b) and more than five million customer accounts, operating out of the two most vibrant economies in the sub-region - Nigeria and Ghana. It has 428 retail distribution centres across Nigeria, its main operational base, and five branches in Ghana. Outside Africa, it also has presence in New York and Cayman Island.
Today's UBA is the product of the merger of Nigeria's third and fifth largest banks, namely the old UBA and the erstwhile Standard Trust Bank Plc (STB) respectively, and a subsequent acquisition of the erstwhile Continental Trust Bank Limited (CTB). The union emerged as the first corporate combination in the history of Nigerian banking.
The bank's history dates back to the founding of the old UBA in 1946, and the erstwhile STB and CTB both in 1990. Although today's UBA emerged at a time of industry consolidation induced by regulation, the consolidated UBA was borne out of a desire to lead the domestic sector to a new era of global relevance by championing the creation of the Nigerian consumer finance market, leading a private/public sector partnership at supporting the acceleration of Nigeria's economic development, and growing the institution from banking to a one-stop financial services institution, while spreading its footprints across Africa to earn the reputation as the face of banking in the continent.
UBA only recently reported a balance sheet size in excess of N1 trillion, the first by any Nigerian bank in history. It also has the highest fund disbursement under the Small-scale Enterprises Equity Investment Scheme, something that would gladden the heart of small-scale operators across the country.
A very dynamic and well focused bank, it also recently launched a naira based credit card the second bank to so do. And late last year, UBA Plc and China Southern Airlines, said to be the largest airline in China signed a pact that would make travelling to that country very easy and smooth.
A statement made available after the agreement signing ceremony stated that the partnership between the two organizations was meant to provide safe, convenient and hassle-free travel solutions to passengers travelling between Nigeria and China. The airline which commenced direct flight operations from Nigeria to China on December 31, 2006, "is strategically significant as it is the first ever Chinese carrier to operate to Africa, and underscores the growing bilateral relationship between Nigeria and China," a statement from the bank read.
The Banker's Top 100 sub-Saharan African banks' listing also has UBA as among the leading banks in Africa.
Tony Elumelu, the managing director of UBA Plc, only recently bag the African Banker of the Year award in East Africa. He has done much to position the bank as one of the leading banks in the country. A very daring CEO, a factor many say has helped him to grow the bank to its current level, Elumelu would tread where his fellow CEOs dare not go, if the profit is right and, of course, after a thorough assessment of the risk involved.
A very dynamic and hard working chief executive officer, Elumelu has led his bank to win so many laurels within the short history of the enlarged UBA.
The bank is the first ever and only Nigerian financial institution to post a N1 trillion balance sheet size and contigents. In the 2007 rating of banks, Agusto & Co rated UBA as number one bank in Nigeria.
Document AFNWS00020070305e335000uu

Nigeria Oil Min: South Korea's KNOC to Get 4 Oil Blocks
By David Winning

Of DOW JONES NEWSWIRES

798 words

4 March 2007

02:35 AM

Dow Jones International News

DJI

English

(c) 2007 Dow Jones & Company, Inc.
BEIJING (Dow Jones)--Korea National Oil Corp. has been given right of first refusal for four oil blocks to be offered in a licensing round in Nigeria, but the sides have yet to agree final terms, Nigeria's oil minister said Sunday.
"We are very anxious to do the deal with the Koreans by the end of March," said Edmund Daukoru, Nigerian Minister of State for Petroleum Resources, in an interview with Dow Jones Newswires.
It is the first time Daukoru has confirmed how many blocks the South Korean company, better known as KNOC, will receive in exchange for a long-term, low-interest loan being put up by the South Korean government.
China National Offshore Oil Corp., or CNOOC, will also get four oil blocks in the bid round to be held by the Nigerian government just weeks before President Olusegun Obasanjo steps down and elections are held.
Oil and gas companies from China and South Korea have been targeting energy reserves in Nigeria, using government-to-government agreements backed up by low-interest loans to secure preferential treatment over competitors.
Both Asian countries are major oil importers, and they are attracted to sweet Nigerian crude oil because it's cheaper to refine into petroleum products than crude from some other exporting nations.
Daukoru said the CNOOC deal was finalized a week ago after Nigeria received an official letter from Export-Import Bank of China nominating the company to manage the blocks. The blocks have been allocated in return for an investment package financed by a $2.5 billion loan.
The blocks to be awarded to CNOOC must be "producing," although the exact interpretation of this clause still needs to be agreed by China Exim Bank and the Nigerian government, he said.
The blocks should have reserves that companies can add to their bottom line, "whether they are flowing or not," Daukoru said in the interview. "That is the way I'd like to interpret it."
The CNOOC deal is likely to include reserves of around 600 million barrels of oil, although it remains to be seen whether China will be happy with blocks where production has yet to begin, especially considering its fast-growing energy needs.
"It may not be all of the four (blocks), but some of them will be ones with absolutely clear-cut prospects," Daukoru said.
He described them as "blocks where the government is backing in, with the possibility of early production coming, albeit not yet in production."
Nigeria offers oil blocks as collateral against the loans put up by the Chinese and Koreans. Their share of production volumes are calculated to match the total interest that Nigeria is required to pay.
Last year, KNOC won the exploration rights for two offshore blocks in Nigeria. This came with a promise from the Koreans to construct a 1,200 kilometer gas pipeline running from the Niger Delta to Abuja and to fund a fertilizer plant and a power station with a capacity of 2,250 megawatts.
Under the terms of a memorandum of understanding with Nigeria in November that forms the basis of its right to four blocks, Korea agreed to fund a 1,500-kilometer-long railway project connecting Port Harcourt-Abuja-Maiduguri.
China has won a similar contract to build a railway in the western part of Nigeria.
According to Daukoru, Nigeria will use $500 million of the China Exim Bank loan to finance the railway, although the total cost of the project is likely to total $6 billion.
A further $1.46 billion will be invested in a hydropower plant in Nigeria, with $500 million being spent on a telecoms project. Daukoru did not reveal more details.
However, Daukoru expressed his disappointment at the lack of progress made by China National Petroleum Corp. (CNPC.YY) in developing the Kaduna refinery in northern Nigeria, which formed part of a $2 billion investment package committed in return for four blocks in May last year.
CNPC has completed inspecting the refinery, but it remains out of action due to a lack of a feedstock caused by disruptions to its supply line.
"One would have expected them to really take the Kaduna refinery apart, look at everything that needs to be looked at for us to get a firm proposal of what needs to be done from them," Daukoru said.
"But they are on it - I can say that they are on it - the last word is not said," Daukoru said.
No one answered the phone at CNPC headquarters in Beijing when a reporter phoned Sunday seeking comment.
-By David Winning, Dow Jones Newswires; 8610-65885848; [e-mail] [ 04-03-07 0738GMT ]
Document DJI0000020070304e3340000p
Africa: Demand High; Obstacles Remain
2,391 words

1 March 2007

Via Satellite

VIAS

Vol. 22; Issue 3

English

(c) 2007 Access Intelligence, LLC. All Rights Reserved.
By Peter J. Brown
Satellite-based services support everything from pay TV and cellular phone services to robust broadband and niche VSAT markets throughout Africa. While the market is growing, Africa remains a continent where even more satellite connectivity is needed urgently.
The most important goals for the Regional African Satellite Communications Organization (RASCOM) include obtaining "coverage of the entire African continent, including its islands, with one satellite; creating connectivity among African countries; rural integration and price competitiveness; and addressing the issue of affordability," says Jones Killimbe, director general of the organization.
But while demand for satellite services continues to grow throughout Africa, many obstacles remain for those who wish to bring additional services to Africa. Satellite networking suffers from both a shortage of capacity and the absence of a single satellite that can cover the entire continent. Many African satellite service providers describe prices as too high in an increasingly competitive environment, and while the regulatory approval process is improving, it remains too slow in many countries.
African entrepreneurs who want to start new satellite-related businesses also face difficulty in gaining access to optimistic international financing institutions, Killimbe says. "While we are witnessing an exponential growth in terms of customer numbers, international financial institutions are still pessimistic about the African market," he says.
Satellite bandwidth also remains far too expensive for the average African business or private sector to afford, says Abdul Bakhrani, London-based technical director at Intersat Africa Ltd., which offers trunking services to various Internet service providers and voice over Internet protocol (VoIP) service providers throughout Africa and the Middle East. Bakhrani wonders how service with speeds of just 512 kilobits per second can cost $10 per month in the West, while the same bandwidth will easily cost 50 times more in Africa. "If you want the market to explode, then bandwidth costs need to be addressed. If they were reduced, then there is a colossal market in Africa that is waiting to embrace satellite bandwidth," he says
Intersat, which is headquartered in Nairobi, is among the companies trying to alleviate this problem, participating in the e-school program developed by New Partnership for Africa's Development Africa along with Cisco, Microsoft and AMD. The program, launched in 2003, aims to provide computers and Internet access to schools throughout Africa and provides C- and Ku-band services that include SkyDSL and SkyNet provided via an iDirect VSAT platform using a hub in Washington.
But the private sector can do only so much to cut prices, which also are driven up by import duties can easily add 35 percent to the price of satellite equipment. "These absurd taxes discourage the growth of African businesses who find it difficult to justify the exorbitant costs of implementing satellite bandwidth."
While cost must be reduced, Bakhrani also describes regulations for VSAT licenses in African countries as still quite rigid and difficult to acquire. "In those countries where you can get VSAT licenses, the process can be extremely tedious and lengthy; a lot of influence coupled with various informal methods are still required to get the licenses approved," he says. "Licensing which is restrictive is not helping to overcome the digital divide. Licenses which do not permit VoIP telephone calls from Internet cafes limit the viability of those businesses because they cannot survive when the only business they can do is Web browsing at $1 an hour. Disruptive technologies like Skype are literally re- writing the rules for telephony -- not just in Africa, but across the world."
Steady Growth
Russell Southwood, CEO of U.K.-based Balancing Act recently published a report called African Satellite Markets that looks in detail at the state of the market on the continent. "Satellite bandwidth has been growing very rapidly across all regions," he says. "Growth has tended to come from specific market sectors. In particular, there has been considerable growth from both the banking sector -- connecting ATMs -- and the cellular sector." Southwood also sees the recent mergers between operators as giving the merged entities some greater degree of flexibility about meeting demand.
"But whatever the underlying position with operators, the larger resellers have often bought considerable amounts of bandwidth," says Southwood, adding that price stability in the region is influenced by some trends towards greater liberalization on the regulatory side, and in East Africa by the arrival of international fiber in 2008 which will result in bandwidth prices of between $1,000 to $2,000 per megabit per second per month.
"Satellite operators will be unable to match the lower end of this range and will therefore lose business in the fiber- connected urban capitals of East and Central Africa," says Southwood. "This lowering of prices on the eastern side of the continent will knock-on to the western side of the continent, starting in South Africa. The latter will have a choice between two fiber cables and will almost certainly choose the cheapest capacity."
Despite these concerns and the fact that competition from pay TV, IPTV and DSL broadband is increasing, satellite is benefiting from this overall increase in telecom and entertainment-driven activity. When it comes to the integration of last-mile connectivity for wireless networks, Gilat Satellite Networks expects significant growth in East Africa and West Africa in particular, says Janna Koretskaya, Gilat's regional vice president of Africa,
"Over the years, VSAT technology has become increasingly affordable to a wider range of end users in Africa," says Koretskaya. "As this trend continues, we believe we will see operators using VSATs as part of hybrid networks, where VSAT is integrated into a broad networking solution that includes DSL, Wireless Local Loop, Wi-Fi and even WiMAX." Koretskaya credits the high demand for satellite services to the fact that the continent is so far behind in terrestrial telecommunications infrastructure. "New investment in antennas and the deregulation of some markets has allowed the continent to jump ahead of the old types of fixed-line infrastructure. IPTV via satellite is also driving demand, and we expect that demand to continue to grow in the coming years," she says.
Intelsat, which works with leading African direct-to-home (DTH) providers such as MultiChoice and Sentech, considers itself the leading service provider for broadcasters. Intelsat offers its African customers more choices as far as video compression is concerned, along with access to more advanced high- definition TV programming coming from Europe, says Flavien Bachabi, Intelsat's regional vice president, Africa. Regional content delivery growth also is helping satellite service providers maintain their competitive edge. "We are seeing significant growth in satellite-enabled broadcasting, Internet trunking and cellular backhaul initiatives throughout the continent, especially in the countries experiencing political stability and progressive regulatory reforms," he says. "Countries with significant regulatory reform include Nigeria, Morocco, Ghana, Uganda and South Africa, to name a few."
SES New Skies has planned to replace its NSS-703 satellite at 57 degrees East with the NSS-8 spacecraft to increase C-and Ku-band coverage of East Africa, says Michael Schwartz, senior vice president, marketing and corporate development. But after the loss of NSS-8 in a January launch failure, NSS-703 will continue to serve customers in the region until 2009. "We have not observed major rollout of cable television networks. Distribution of satellite television is mainly a DTH market. Some terrestrial networks redistribute satellite programming," says Schwartz. "Our customers are looking for satellite services mainly because of lack of reliable terrestrial alternatives, fast deployment of satellite-based services and reduced opportunity cost." Schwartz offers examples such as cellular operators who use satellite to connect their different switching centers in order to offer instant access to their mobile subscribers and national and private TV broadcasters who are using satellite to maximize their reach as well as their advertising revenue.
Hot Markets
According to Bachabi, terrestrial wireless broadband and even cell phone service providers are gaining some momentum within Africa, and these applications are using satellites for backhauling. "Intelsat serves more than 60 mobile operators, most of them from Africa. For Africa, based on penetration rates, the deployment of cellular seems to be faster than the deployment of broadband," he says. "IP technology allows users to suppress packets of data that are useless, such as packets that are transporting silence, and therefore improve link efficiency significantly, up to 50 percent. We observe that African operators are increasingly taking advantage of this new technology to reach out to more remote areas."
The introduction of IPTV and additional gateways are helping to grow the market, too," says Southwood. "The number of countries with only one international gateway is considerably reduced. One major market - South Africa - is about to liberalize its international gateway regime shortly," he says. "Those without a liberalized international gateway regime pay higher prices because the monopoly incumbent has no competition." South Africa also has opened the gates to 18 new pay-TV operators, he says. "That process will slowly happen across the continent in the coming period. This will inevitably lead to greater broadcast use of satellite, but it will also be in competition with IPTV operators distributing signal using DSL broadband."
Bachabi sees steady progress throughout the continent, with more than two-thirds of the countries having more than one mobile operator and approximately one-third of all state telcos in Africa having privatized. "More telecommunication sectors are opening up. This trend is continuing, and the regulatory landscape will be improving in many countries in the coming years," he says.
Most African countries have liberalized their telecommunication sector and have allowed use of satellite for public and private VSAT networks, IP trunking, educational services and voice trunking services, says Schwartz. "Access to satellite is limited in most cases to few players except in Ethiopia, where satellite access remains under the monopoly of the national telecom carrier, the Ethiopian Telecommunication Corporation," he says. "In countries such as South Africa, where a limited number of players are allowed to offer satellite services, growth of satellite access has been limited due to the lack of competition and the incumbent operator's preference for use of terrestrial alternatives."
Continued growth in the VSAT market depends on deregulation efforts in the various countries, says Koretskaya. "In general, governments are realizing that opening up the regulatory environment allows entrepreneurs to provide more communications which helps the economy and growth of the country. Africa is getting into more competitive markets as opposed to the monopolies that dominated 10 years ago. African governments are slowly recognizing that information tools such as high-speed Internet connectivity are critical to economic success and personal advancement. As information technology plays an increasingly important role in Africans' economic and social lives, the prospect that some will be left behind in the information age can have serious repercussions," says Koretskaya.
Broadband Footprint Increasing
As far as broadband over satellite services are concerned, Africa is witnessing a steady increase in activity. "In the last years, we have seen a significant increase in demand for broadband connectivity," says Schwartz. "In particular, broadband over satellite has become more affordable as a result of the introduction of hub-based VSAT services. The costs of terminals has decreased and more efficient modulation and coding has increased bandwidth efficiency."
Hub-based services allow local service providers to remotely manage their own customer base on shared facilities, lowering startup and operational costs. This has resulted in a meaningful increase of local service providers. "As satellite broadband has become more affordable, we have seen an increase in demand from smaller companies and internet cafes," says Schwartz. "Churn is not a major concern because we expect that terrestrial technologies, such as wireless broadband, will serve as a last mile solution in combination with satellite connectivity."
Broadband services are growing throughout Africa, and satellite-enabled services are in the forefront, says Bachabi. Intelsat capacity, which delivers more than 2 gigabits per second of traffic to Africa, supports IP distance learning and e-health initiatives and facilitates access to Internet connectivity for many urban and rural centers.
But pricing continues to be an issue for many businesses and consumers alike, says Southwood. "More than half the countries of Africa now have some form of broadband offer. The majority of these offers have been using DSL over the telco incumbent's network," he says. "This growth has spurred a number of satellite broadband offers including things like [Inmarsat's Broadband Global Area Network] and iWay. These services are now providing higher levels of connectivity for remote areas but connectivity prices remain, in relative terms, high."
Domestic Satellite Taking Shape
As the African satellite market prepares to enter another stage, Nigeria is among the first countries working to increase options across the continent by developing its own satellite. In 2006, the Export and Import Bank of China agreed to provide $200 million to fund Nigeria's first communications satellite project. The deal involves the construction and launch of Nigcomsat-1, which is based on China's new DFH-4 platform. In 2005, when this joint project started to take shape, Ernest Ndukwe, executive vice chairman of the Nigerian Communications Commission told the Chinese media that Nigerian investments in RASCOM were substantial and that this new satellite would not only boost satellite bandwidth in Nigeria but throughout all of Africa. This satellite will carry four C-band, 18 Ku-band, four Ka-band and two L-band transponders.
Nigcomsat-1 had been scheduled to be launched in early 2007 by a Chinese Long March 3 B rocket. However, the October launch failure that destroyed the Sinosat-2 satellite raises questions about the timetable. Killimbe indicates that Nigeria is proceeding with the launch as planned. "To me, Nigeria's participation is a testimony of the existence of a huge unsatisfied market demand in Africa as a continent at the regional level as well as at country level," he says. "RASCOM considers all existing and future infrastructure solutions as playing a complementary role in creating a total solution for African needs. Africa, just like Europe, Asia and China, needs huge capacities in order to stimulate traffic volumes and create affordability level as well as to become active participants in the information society."
Africa is eager to see more satellite dishes, and the best is yet to come for the satellite sector as a whole.
Document VIAS000020070315e33100005
U. Wisconsin: COLUMN: United States should follow China's diplomatic example
832 words

1 March 2007

U-Wire

UWIR

English

(c) 2007 U-Wire. All Rights Reserved.
U-WIRE-03/01/2007-U. Wisconsin: COLUMN: United States should follow China's diplomatic example (C) 2007 Badger Herald Via U-WIRE
By John Sprangers, Badger Herald (U. Wisconsin)
MADISON, Wis. -- Hu is President Bush's daddy when it comes to
diplomacy? Chinese President Hu Jintao recently completed a "tour de Africa" that exemplified Chinese international relations - reaching out to the developing world by giving massive aid for infrastructure development with no expectation of reform or fair distribution of revenues to impoverished peoples.
This influence peddling - while at best amoral and at worst ethically reprehensible - is nonetheless rapidly elevating China's prominence in the world. Coupled with George W. Bush's general disdain for international relations, this new trend will prove problematic for the United States as China continues its inevitable rise to superpower status - especially as Chinese activities center on resource-rich states.
For instance, columnist Moises Na'm has noted that China overrode a $5 million railroad aid package to Nigeria from the World Bank contingent on cessations of corruption with a whopping $8.3 billion package with no such reform strings attached. It additionally promised $4 billion to develop the Nigerian oil producing apparatus. President Hu is sending $6 billion in interest-free loans to the repressive Angolan regime for infrastructure development, including improved telecommunications and transportation. And, perhaps most tellingly, China will be providing cash for a new palace for Sudan's infinitely deserving President Omar al-Bashir. Never again will China allow genocidal tyrants to live in squalor.
Of course, the Chinese regime is not simply feeling philanthropic. It is getting near-exclusive access to some of the world's finest natural resource stockpiles - Sudanese oil, Zambian and Angolan copper and Namibian uranium among them. Also, as in the case of the Angolan aid, the agreements stipulate that Chinese firms undertake a majority of the contracting, helping to further stimulate a juggernaut economy. And, most difficult to quantify but perhaps most important for the future, China is currying favor as a champion of the developing world as a welcome alternative to the Western proselytizers of free markets and political reform. In fact, a "Beijing Consensus" advocating self-determination of governance and economic system is coming to rival the quarter-century old Washington Consensus for development in Latin America, Africa, and Southeast and Central Asia.
Of course, Washington knows this game well. After all, it hasn't been supplying enormous aid to Saudi Arabia for decades because of shared ideology or common purpose - it's the oil reserves, stupid! However, the Bush presidency has been something of a great leap backward in international relations. Not only has it seen the widely and wildly unpopular global war on terror make burnings of our star-spangled banner more ubiquitous than Mickey Mouse (though perhaps less than Iraqi car bombings) and displayed complete disregard for international governance and law, President Bush's diplomatic overtures have ranged from limited to nonexistent. For example, his last trip to Africa was in 2003. President Hu, meanwhile, is making his second trip there in less than a year.
Granted, these international developments don't mean much to Americans today. However, a certain frigid conflict of yore should remind Washington foreign policy elites about the importance of carving out spheres of influence and ensuring continued access to natural resources in a bipolar world. Though the United States continues to stake a legitimate claim as the world's sole superpower, China - with its 8 to 10 percent annual economic growth and billion-plus citizens - is not so far away from attaining that status.
In my mind, the United States should do two things rethink its approach to international relations in general and development aid in particular. The government needs to demonstrate concern for the international community by following the Chinese diplomatic touring model and treating agreements and bodies such as the Geneva Conventions and the United Nations with proper deference. And, while I certainly don't advocate copying China's ruthless form of aid, the United States does need to change the IMF-World Bank sanctioned approach to development that is unpopular in the Global South. This method requires that nations receiving aid open their markets to foreign capital and strip away protective tariffs, measures that have failed miserably in cases such as post-communist Russia.
The global winds of change are ushering in a new era of bipolarity and competition for influence. China, via savvy, active diplomacy coupled with rogue aid, is gaining key access to resources and international support for its regime. It's high time for the United States to reestablish its presence in the developing world. After all, when the international system gets "cold" again, we'll want to have enough fuel to stay warm.
John Sprangers ([e-mail]) is a sophomore majoring in political science and international studies.
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Document UWIR000020070302e331000d5

Chinese Investment in Nigeria - What Motives?
by Abimbola Akosile

2,586 words

28 February 2007

07:16 AM

All Africa

AFNWS

English

(c) 2007 AllAfrica, All Rights Reserved
Lagos, Feb 28, 2007 (This Day/All Africa Global Media via COMTEX) --
Here comes a 'giant'
China has 56 ethnic groups with an estimated total population of about 1.1 billion people, compared to Nigeria's contended 140 million citizens. Its major tribe is the Han, while the other 55 ethnic minority groups share about 100 million people spread throughout the country.
China's exports in 2006 rose 27.2 percent from the previous year to $969 billion, while imports were up 20 percent to $791.5 billion. The country's global trade surplus for 2005 was $102 billion. The United States trade gap with China was expected to pass 2005's record $202 billion. China's global surplus is smaller than that with the United States because it runs a deficit with other countries.
The country raised the yuan's value against the dollar by 2.1 percent in July 2005 and has let it gradually climb by about 3.8 percent since then in tightly controlled trading.
China also was a net auto exporter in 2006 for the second straight year, It also said exports doubled last year to 300,000 units, while imports rose 41 percent to 229,000 units.
Recently, Beijing hosted a summit for 48 African leaders, where top officials offered $5 billion in loans and credit to Africa along with a doubling of aid.
Trade between China and Africa reached $55.5 billion last year, up 40% from the previous year and a 10-fold increase from a decade ago, while accumulated direct Chinese investment in the continent reached $6.6 billion. China's rapid economic growth, reported to be 10.7% in 2006, has brought the nation to Africa's attractive resources. China began to open up its economy in the late 1970's when it moved from a centrally planned economy to a market-oriented economy; it decentralized trade, slashed tariffs, unified the dual exchange rates in 1994, and removed exchange controls on current transactions in 1996. These actions, together with other reforms, triggered the rapid expansion of China's investments in other countries, as well as foreign investment into China.
Many African countries welcome investments by the Chinese-who do not attach conditions such as guarantees of transparency or good governance to their projects. Some human rights activists say they worry that China's policies could prevent Africa from democratizing. They also say that increase trades with China-which often floods African market with cheap finished goods-is bankrupting local manufacturers. China denies accusations by critics, who say its investments are comparable to European colonialism.
Local Dumping Ground
There is a growing debate and uneasy calm within the Nigeria's business circle over the invasion of Nigerian market by Chinese investors. On the one hand, it is seen as a blessing as China is an emerging power in the global scheme of things, on the other hand it is seen as dangerous and an attempt to further cripple the dwindling Nigerian economy.
President Olusegun Obasanjo has described China's investment drive in Nigeria as part of the overall reform of the national economy, so as to give the nation a fresh economic breeze, as well as to benefit from China's experience as an emerging super power.
China, experts say, is set to occupy the enviable world leadership position commensurate with its dynamic and huge population and its material achievement in all spheres. China is not interested in competition for world domination and colonialism but friendship and economic partnership which it hopes will ultimately benefit its less privileged partners.
The Nigerian government has put a lot of effort in cultivating good friendship with China in a drive for economic reform and Foreign Direct Investment (FDI). Several Chinese companies in construction, telecommunications, oil and gas, pharmaceuticals, etc., have thus invested billions of Naira in Nigeria, as a result.
According to Louis Okoroma, a Public Affairs Analyst, an important feature about China's growing interest and relationship with Nigeria is that our country's business landscape is widening and becoming more competitive among nations.
In the same vein, other countries are also working hard to break the Nigerian market thus making Nigeria, an important destination for international investment and finance. But one complaint by Nigerian investors is that Nigeria is fast becoming a dumping ground while indigenous companies are dying.
This criticism of China's economic present in Nigeria does not call for Nigeria's break up of its relations with the emerging power; all it calls for is common sense.
In Nigeria and other parts of Africa there is growing concern about many fake products coming from China and cases of dumping. Africa needs firm commitments from China to attack and stop this menace.
One also expects that in the long run the several hundred Chinese companies now operating in Africa will transfer their technical and managerial skills to African workers to enable them to take over the industries completely. This will ensure the credibility of China, strengthen cooperation, and enable China to move to greater heights and responsibilities.
Overseas Direct Investment
In 2004, China's non-financial direct investment overseas totaled $3.62 billion, up 27 percent over 2003. Of this total, equity investment was $2.506 billion, accounting for 69 percent, and reinvestment of profits amounted to $1.116 billion, accounting for 31 percent.
By the end of 2004, the accumulative amount of China's overseas direct investment had approached $37 billion. During the year, 829 Chinese-invested enterprises were established overseas, with approval of the Ministry of Commerce, involving $3.712 billion in contractual investment by Chinese companies.
China's overseas direct investment in Asia (concentrated in such countries and regions as Indonesia and Hong Kong) stood at $1.396 billion, accounting for 38.6 percent; in Europe (mainly in Germany and Russia), $308 million or 8.5 percent; in Africa (mainly in Nigeria, South Africa and Madagascar), $135 million or 3.7 percent; in North America (mainly in the United States), $62 million or 1.7 percent; and in Oceania (mainly in Australia), $48 million or 1.3 percent.
China's trade with Africa has risen four-fold in the past four years. It is now said to be $40bn. China has overtaken the UK to become Africa's third most important trading partner, after the US and France. Because its oil needs are expected to double in 15 years, China has invested in particular in Sudan, Angola and Nigeria.
The oil majors have shown that Africa need not be stable to make a profit. Nigeria and Equatorial Guinea demonstrate that oil brings in money, but it rarely benefits the 'masses'. Nigerian leaders have allegedly mis-spent roughly $400bn (from oil and aid money) in 40 years.
According to statistics from the US. Geological Survey (USGS), the principal mineral targets in Africa are diamond, PGMs and gold, but investment in other areas is rapidly growing.
Substantial capital expenditures were also likely for aluminium in Mozambique and South Africa, copper in Congo (Kinshasa) and Zambia, crude petroleum in Nigeria, Angola and Sudan, iron ore in Mauritania and Senegal, and natural gas in Nigeria. Additional investment in uranium, radium, low-cost thorium, chromium, titanium, tantalum, germanium and lithium are also expected.
History of Trade Ties
West Africa's enormous potential has made it a geopolitical battle-ground for natural resources between the US, China, India and other resource hungry countries, experts say.
China sought then to show that its rapidly expanding ties with Africa went beyond the oil and minerals that Beijing has been snapping up to fuel its economic boom.
As recently as February 19, China announced that it would lend African nations 1.5 billion pounds in preferential credit over three years and double aid and interest-free loans over the same time. According to reports, this is part of China's latest efforts to shower the continent with business and aid, but Africa's raw materials are widely regarded as the main prize, with the continent's energy resources believed to be high on the list of priorities.
China has faced criticism from Western aid groups that it encourages corruption and misrule by failing to demand accountability when giving aid, loans and investment.
In 2006, trade between China and Africa reached GBP27 billion, a jump of 40 per cent on the previous year and accumulated direct Chinese investment in the continent reached GBP3.3 billion.
So Many Promises
In addition, hundreds of African business people went for a two-day trade exhibit immediately following the summit, eager to explore new market outlets in the world's most populous country and one of its fastest-growing economies.
The summit approved a three-year action plan to forge a "new type of strategic partnership". The plan pledges that China will double aid to Africa by 2009 (to about $1-billion); set up a $5-billion China-Africa development fund to encourage Chinese companies to invest in Africa; provide $3-billion in preferential loans and $2-billion in preferential buyer's credits to African countries.
China also plans to cancel all debt stemming from Chinese interest-free government loans that matured by the end of 2005, for the 31 heavily indebted and least developed countries (LDCs) in Africa that have relations with China (an amount estimated at about $1,4-billion); further open its markets to exports from African LDCs by increasing from 190 to 440 the number of products receiving zero-tariff treatment.
The economic super-power also pledged to train 15,000 African professionals, double the number of Chinese government scholarships given yearly to Africans (to 4,000) and send 100 senior agricultural experts and 300 youth volunteers; and build 30 hospitals, 30 malaria-treatment centres and 100 rural schools.
China also vowed to support the African Union, including by building a new convention centre at the AU headquarters in Addis Ababa. It likewise reaffirmed its commitment to the New Partnership for Africa's Development (Nepad), the AU's development plan.
Local Chinese Industries
About thirty Chinese industries, according to reports, have moved to site their companies and factories in Ogun State, apparently scared by the complexity of the procedure of setting up businesses in Lagos, the poor state of security in the state, the serious problem of multiple taxation and street urchins (Area boys).
Also another Chinese investor has completed three huge industrial estates in Ogun, which will be launched together with the 30 new industries in the state next week.
Announcing the Chinese investment, the governor of Ogun State Otunba Gbenga Daniel explained that the development is a testimony to the fact that the private sector posture of his administration in the state is paying off. He said his administration deliberately turned to the private sector as the main driver of development in the state. The close collaboration with the private sector according to him has worked very well for the state and the fruits are the results they have began to see in the state.