A Week in Nigeria: 29 June

Uber said it sees West Africa as a key area for potential growth

In this week’s round-up: Uber hopes to launch Lagos boat service in West Africa expansion, MTN’s $2 billion tax case rumbles on, and more fighting between ISWAP and soldiers in the northeast.

  • Global ride-hailing firm Uber is in talks with regulators over plans to provide a boat service in Nigeria’s commercial capital Lagos as part of a drive to expand in the region, a company executive said in an interview. Brooks Entwistle, the company’s chief business officer, said it was part of a broader drive to expand in West Africa. Nigeria’s commercial capital Lagos, a megacity of around 20 million inhabitants built on a lagoon where Uber began operating in July 2014, is beset by heavy congestion. Entwistle, who described Lagos as “one of the great growth opportunity cities in the world”, said the company was in talks with state regulators about providing a transport system on the city’s waterways as a way of bypassing its choked roads. He said Uber was also in talks about the possible launch of services in Ivory Coast and Senegal. “We have talked about West Africa today as being a big growth priority for us and launch priority for us moving forward,” said Entwistle. Ivory Coast and Senegal have two of the world’s fastest growing economies, according to the International Monetary Fund. Nigeria, Africa’s largest economy, is also the continent’s most populous nation. A number of motorcycle ride-hailing firms have also targeted West Africa as an area for expansion in the last few months.
  • A Nigerian judge on Wednesday adjourned until Oct. 29 a case to resolve a $2 billion tax dispute between South African telecoms company MTN Group and Nigeria’s attorney general. The attorney general last year demanded MTN pay the $2 billion. The company has said the tax demand is without merit and the attorney general has exceeded his powers in making the request. Lawyers for the government requested the adjournment. Shares in MTN Nigeria dropped to their lowest level since the telecom company listed five weeks ago in the wake of the adjournment. Analysts said the court adjournment created uncertainty for investors as the tax dispute would continue to linger. Shares in MTN, the local unit of South African telecoms group MTN Group, dropped 2.4% to 128.75 naira each, their lowest level since May 21. They were still above their initial public offer price of 99 naira when the company listed on May 16. MTN Nigeria listed with a valuation of 2 trillion naira ($6.5 billion), making it the second-biggest company on the Nigerian Stock Exchange. It climbed to as high as 159.30 naira in the days after listing. The listing came after the South African group resolved another dispute in Nigeria over unregistered SIM cards. In December, it made a $53 million payment to resolve a money transfer allegation out of Nigeria, levelled by the central bank. Nigeria is MTN’s biggest market, with 58 million users in 2018 and accounting for a third of the group’s core profit. But the Nigerian business has faced several challenges. MTN has said it would sell more shares to the public and increase local ownership in MTN Nigeria once the tax row was resolved.
  • The MTN case wasn’t the only notable adjournment of the week. A federal court in Lagos adjourned a case brought by local oil firm Oando to stop Nigeria’s financial watchdog from replacing its chief executive and making other management changes. The case was adjourned to July 22. The SEC’s action followed an investigation in which it allegedly found evidence of financial infractions by the company. This month a court blocked the SEC from replacing Oando’s chief executive and taking other action against the oil firm, pending further hearings on the case. Oando has dismissed the SEC charges as unsubstantiated and called for the SEC to release the full audit on which it is basing its charges. The Lagos-listed Oando, which also has a dual listing in Johannesburg, has evolved from a fuel retailer into a major indigenous oil producer that competes with multinationals such as Royal Dutch Shell and Exxon Mobil in Nigeria.
  • A West African task force set up to tackle Islamist insurgents in the region said its troops killed 42 suspected Islamic State fighters in a battle in the Lake Chad region on June 21. It said that was the heaviest death toll suffered by the insurgents in the last six months. The Multinational Joint Task Force (MNJTF) comprising troops from countries bordering the lake — said one of its soldiers was killed and 10 others were injured. In an apparent reference to the same clashes, Islamic State said its fighters had killed 15 soldiers in fighting on June 21 at Garno, a town in Nigeria’s northeastern Borno state near Lake Chad. It said a suicide bomber detonated an explosive device but did not refer to any of its fighters having been killed. Reuters was unable to independently verify the claims made by both sides. We also reported a separate flashpoint in which Islamist insurgents killed at least 20 civilians in a northeast Nigerian village. The attack comes less than a month after Nigeria’s President Muhammadu Buhari began his second term, once again vowing to bring security to a country bedevilled by a slew of conflicts that have killed tens of thousands and show little sign of ending. The militants struck the village of Ngamngam in Borno state, near the border with Niger.
Nigeria won the Africa Cup of Nations in 2013 but then failed to qualify for the last two tournaments in 2015 and 2017
  • There were several stories this week reported or written by Reuters correspondents based outside Nigeria that related to the country. The team covering the Africa Cup of Nations tournament in Cairo reported that Nigeria’s football federation (NFF) said it had received “part of the money” allocated by the government for the national side’s participation at the tournament following threats of protests by the players. The NFF’s acting president Seyi Akinwunmi said in a statement that it had received enough money to pay the players their win bonus for beating Burundi 1–0 in their opening game on Saturday plus cash other games. “We want to specially thank His Excellency, President Muhammadu Buhari for his keen interest in resolving this matter quickly, which has enabled us to receive part of the money in record time,” said Akinwunmi. He said he had a “telephone discussion” with team captain John Obi Mikel and “can safely say that all clarifications have been made and the usual cordial relationship and understanding between the players and we the administrators is still intact.”
  • Synthetic opioid use is booming, the United Nations said in a worldwide drug report that showed deaths in the United States from overdoses still rising and a “crisis” of tramadol use emerging in parts of Africa. The estimated number of people using opioids — an umbrella term for drugs ranging from opium and derivatives such as heroin to synthetics like fentanyl and tramadol — in 2017 was 56% higher than in 2016, the U.N. Office on Drugs and Crime said. While that surge, to 53.4 million people worldwide, was due to more data being available thanks to surveys in Nigeria and India, it also highlighted the scale of the problem despite a drought-related fall in opium production last year in the world’s biggest producer, Afghanistan. Synthetic opioids like fentanyl continue to be the main cause of opioid overdose deaths in the United States, which rose 13% to more than 47,000 in 2017, further illustrating what President Donald Trump has declared a public health emergency.
  • Our Nairobi bureau reported that Jumia Food, a unit of New York-listed e-commerce platform Jumia Technologies is offering cheaper menu options in its African home market to attract lower income earners as it seeks to boost growth, the delivery company said. The platform, which delivers food and drink in 11 African countries, joins other international companies such as Uber and China’s Huawei Technologies who are looking to grow their customer base on the continent beyond the middle class. Jumia became Africa’s first unicorn — a private company with a $1 billion-plus valuation — to test the public market for a sub-Saharan tech firm when it listed in New York in April. When it launched in 2012, Jumia Food focused on the middle class who could afford internet access but growing smartphone use and plummeting data costs are opening up the market to lower income earners. “Increasingly, convenience is also important for people who don’t have a huge amount of money to spend,” Joe Falter, chief executive of Jumia Food, said, adding: “So one of the biggest focus areas now is to expand in (to) the type of consumer who spends a smaller amount per order and maybe does it more frequently.” Jumia Food has about a million customers in 30 African cities including Nigeria’s Lagos and Morocco’s Casablanca, with Kenya its biggest market. Its platform has 4,000 restaurants offering everything from local cuisine to international fast food, from the likes of KFC, Pizza Hut and McDonald’s.
  • And evangelical Christians flocked to Israel for a mass faith-healing by a celebrity Nigerian pastor outside Jesus’s hometown of Nazareth. Some worshippers sang in various languages while others collapsed and even vomited during Sunday’s event, presided over by T.B. Joshua, who has amassed millions of followers on social media from his base in the Nigerian city of Lagos. When the self-described prophet descended from the stage to bless attendees, placing his hand on their heads, several declared themselves healed from sickness or infirmity. Attendants stood ready to catch those who fainted in excitement.



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