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5G: NCC, telcomm firms disagree on 3.5GHz spectrum price, duration

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The Nigerian Communications Commission has released a draft information memorandum for 3.5GHz spectrum auction to facilitate the 5G roll-out in 2022 across the country.

The NCC had fixed December 13, 2021 for the 3.5GHz spectrum auction and had pegged the reserve price at $197.4 million (N75 billion).

But telecoms operators, including GSM Association (GSMA), have disagreed with the reserve price and called for a downward review to enable more operators participate in the 3.5GHz auction process.

The NCC at a stakeholders’ consultative forum, held in Lagos on Thursday, presented the positions of the operators and the GSMA, which they had earlier submitted to the commission.

The stakeholders’ consultative forum, which was organised by the NCC further discussed the reserve price, among other issues such as longevity of the spectrum licence, the auction process, the requirements and rollout obligations.

 

While the NCC was considering a 10-year period for the duration of the spectrum, the operators want the NCC to extend it to 20 years, to enable winners of the spectrum to have enough roll-out time to utilise the spectrum in offering telecoms services to subscribers.

Reacting to the N75 billion reserve price, telecoms operators such as MTN, Airtel, Huawei and Intelsat called on the NCC to consider the current exchange rate in pegging the reserve price.

 

They argued that if the reserve price remained high, it would discourage operators from participating in the auction process.

The Director, Spectrum Administration at NCC, Oluwatoyin Asaju, who presented the draft IM for the 3.5GHz spectrum auction at the stakeholders’ consultative forum said: “The IM provides guidance and process that the commission has decided to adopt for the licensing of the 3.5 GHz band, including details of the spectrum to be made available, the pre-qualification process and the auction process.”

According to him, the 3.5GHz spectrum would come in five lots of 100 MHz each, to be cleared at different periods depending on the level of encumbrances on the slots.

He, however, said for the purpose of the auction, only two lots of 100 MHz each would be offered in the first phase of the auction, while the remaining three lots would be auctioned some other time.

For the auction process, Asaju explained that it would be Ascending Clock Auction (ACA), while the auction would be software based.

He said provisions had been made for manual auction should the auction software fail during the auction process, adding that there would be a mock auction that would precede the main auction on December 13.

“A reserve price of approximately N75 billion, equivalent to $197,400,000.00, will to be used. An Initial Bid Deposit (IBD) equal to 10 per cent of the reserve price is adopted in line with the previous auction.

“New entrants are allowed to participate in the auction in addition to existing licensees and only licensees with 100 per cent regulatory compliance will be allowed to participate in the auction.

“The auction comes with a 10-year spectrum licence and a minimum requirement of a UASL Operational Licence. New entrants or licensees without a UASL will be required to additionally obtain a UASL Operational Licence,” Asaju said.

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CIG upgrades Lagos auto plant to CKD, plans 5,000 vehicles yearly

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A new auto assembly plant being constructed by CIG Motors Company Limited in conjunction with the Lagos State Government has been upgraded from Semi-Knocked Down (SKD) vehicles to Complete Knocked Down vehicle components (CKD), the state governor, Mr Babajide Sanwo-Olu, has said.

The governor disclosed this on Thursday during an inspection of the construction work at the Ogba project site, adding that the plant to assemble GAC brand of vehicles, would be ready by the end of this year.

The governor was received by the Chairman of the CIG Motors, Chief Diana Chen.

A statement by Gboyega Akosile, the governor’s Chief Press Secretary, said Sanwo-Olu, who inspected the fully equipped assembly hall already constructed in the assembly yard, said the plant would produce 5,000 new vehicles and gradually increase to 10,000 units annually.

Part of the statement read, “Sanwo-Olu’s visit came 17 months after the governor formally sealed a Joint Venture Agreement with the automobile company for the establishment of a vehicle assembly plant in the state.

“The plant, expected to be delivered by the end of the year, will have a jointly-run factory for the production of different classes of brand new cars.

“Establishment of the vehicle assembly plant in Lagos was part of the bilateral agreements reached by the state government and Chinese investors’ community in November 2019 during Sanwo-Olu’s business trip to China.

“IBILE Holdings Limited, a state-owned corporation, is supervising the investment on behalf of the Lagos State Government.

“Other ancillary facilities already in place in the yard include wheel balancing chamber, spraying booths, maintenance hall, noise testing chambers, sprinkling arena to test for roof leakage, staff lounge and auto parts warehouse.”

The statement quoted Sanwo-Olu as saying, “This is one of the things we promised Lagosians. Apart from our relationship with CIG Motors, there is a partnership in which we are setting up a vehicle assembly plant.

“This is becoming a reality, as the site is live with structures and assembly equipment. The place has been well prepared for the production of vehicles. We initially agreed it would be SKD (Semi Knocked Down) but now the facility has moved to CKD (Completely Knocked Down).

“We are hoping that their first plan is to have a production capacity of 5,000 vehicles, after which it will be pushed to 10,000 vehicles per year.

“We are happy with the level of work at the site and the commitment of our partner to this project. The plan is that we want to stop buying fully built vehicles from abroad; we want to be able to have an assembly line where we can employ our citizens in an automobile production chain.”

According to him, the automobile assembly plant will create employment opportunities for local skilled workers, as 95 per cent of the workforce would be sourced locally.

“Also, some of the parts used in the assembly plant would be sourced locally, including air conditioning system, valves, ball joints, bolts and nuts, and batteries.”

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Despite Opposition, FG Set to Implement 5 Per Cent Hike on Data, Voice Calls

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Minister of Finance, Budget and National Planning, Zainab Ahmed

*Finance Minister faults Pantami on new tax

Despite opposition by various stakeholders, including the Minister of Communications and Digital Economy, Isa Pantami, the federal government has declared its readiness to implement the five per cent hike in tariff on data and voice calls.

Owing to this, it has directed telecommunications operators to henceforth effect the new tariff and remit to the government before the 21st of every month.
The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed who gave the directive yesterday, also faulted her Communications and Digital Economy counterpart for claiming ignorance of the new tariff hike.

In a statement issued by her Special Adviser, Media and Communications, Yunusa Tanko Abdullahi, the finance minister announced that the government would commence the implementation of the new tax regime on all voice calls, short message services (SMSs) and data services, in addition to the existing 7.5 per cent Value Added Tax (VAT) paid for goods and services across all sectors of the economy.

The statement said the minister made the disclosure on the five per cent excise duty during a stakeholders’ meeting, organised by the Nigerian Communications Commission (NCC), the telecoms industry regulator.

It pointed out that at the meeting, Ahmed, who was represented by the Assistant Director, Tax Policy, Federal Ministry of Finance, Budget and National Planning, Musa Umar, noted: “The five per cent excise duty has been in the Finance Act 2020, but has never been implemented.
“Henceforth, the five per cent excise duty will be collected by telecom operators and payment made to the federal government on a monthly basis, on or before 21st of every month.”

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Reacting to Pantami’s recent position that he was not carried along on the new tariff regime, Ahmed said her counterpart could not claim ignorance of the policy.
She said it was worth noting that there was a circular indicating the planned hike, which was addressed to the communication minister and other relevant ministries and agencies of government via a circular referenced No. F. 17417/VI/286 dated March 1, 2022, and titled “Approval for Implementation of the 2022 Fiscal Policy Measures and Tariff Amendments.”

The statement added: “Against the comments by Prof. Isa Ali Pantami, Honourable Minister of Communication and Digital Economy, concerning the five per cent excise duty hike on telecoms services, it is worth noting that there was a circular stating the planned hike which was addressed to the communication minister and other relevant ministries and agencies of government.

“The circular referenced No. F. 17417/VI/286 dated 1st March 2022, and titled “Approval for Implementation of the 2022 Fiscal Policy Measures and Tariff Amendments” was addressed to different Ministers, including Honourable Minister, Communications and Digital Economy and other heads of government agencies.

“The circular was addressed to The Secretary to The Government of The Federation, Attorney-General of The Federation, Ministers of Industry, Trade an Investment, Agriculture and Rural development, Mines and Steel and Development.

“Others are Ministers of Health, Aviation, Information And Culture, Budget And National Planning. Other heads of agencies copied in the circular are Accountant-General of the Federation, Comptroller-General of Customs, Governor of the Central Bank of Nigeria, Executive Chairman of the Federal Inland Revenue Service and the Director-General of the Raw Materials Research and Development Council.
“Others are the Executive Secretary of Nigerian Export Promotion Council (NEPC) and the Executive Secretary of the Nigerian Investment Promotion Commission.”

Reinforcing her position, Ahmed said with the aforementioned reference, it therefore, meant that all stakeholders had by that singular provision been aware of the Act.
According to her, the excise duty on telecommunication services provided in Nigeria introduced through the Finance Act, 2020 with statutory enactment on January 1, 2021 is yet to be implemented till date.

She added that this was considering the need to ensure reasonable transition period before the implementation of the new tax, as well as providing clarity to all stakeholders on implementation modalities.

Pantami had recently expressed dissatisfaction with efforts by the federal government to introduce the five per cent  excise duty on telecommunication services.

Speaking at the maiden edition of the Nigerian Telecommunications Indigenous Content EXPO (NTICE) themed ‘Stimulating the development of Indigenous Content through innovation and commercialisation’  in Lagos, he had stressed the need for the government and stakeholders to continue to support the sector, and not unnecessarily burden.

Pantami had said he would explore every legitimate means to stop the planned five per cent excise duty on telecoms consumers, faulting the timing and process of imposing the tax on the industry.

According to him, part of the responsibility of a responsive government was not to increase the challenges that citizens were facing.

“The Minister of Communications and Digital Economy is not satisfied with any effort to introduce excise duty on Telecommunications. When VAT was increased to 7.5 per cent, I was not consulted.

” I only heard the announcement and I think there is something questionable and I am glad that we are on the same page with our National Assembly members.

“They too have not been consulted despite the fact that they are part of the committee,” the minister reportedly said.

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Jaiz Bank grows balance sheet to 300bn

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Jaiz Bank Plc, Nigeria’s pioneer Islamic bank, said its balance sheet grew to N300 billion at the end of the 2021 financial year from N12 billion when it started operations 10 years ago.

Managing Director of the Bank, Mr. Hassan Usman, told journalists at a briefing on the bank’s 10th anniversary in Abuja, yesterday, that the bank was able to break even within three years of its operations and has since then maintained a growth trajectory.

According to him, the bank has recorded an average of 30 per cent growth Year-on-Year and a 40 percent profitability Year-on-year; while increasing its branches from the initial three to the current 45.

He stated that the bank invested N75 billion in providing about 3,000 houses and another N60 billion in the Micro, Small and Medium Enterprises, MSMEs, with beneficiaries cutting across urban and rural areas.

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His words: “Jaiz as a pioneer has proved that the concept of non-interest banking is workable even in the Nigerian environment.  We have more interests now in this sector by individuals and corporate organizations.  Even the public sector has embraced the non-interest business model, in order to derive the benefits associated with the system.

“Jaiz Bank started with only three branches in 2012.  Today, we have more than 45 branches spread across Nigeria. In the first year, the balance sheet was just N12 billion.  By the end of 2021, our balance sheet had grown to N300 billion.

“At the beginning, we were more of a corporate banking in terms of our bank’s offering, but now we have diversified the products offering from corporate to SMEs and even in some cases we experimented with micro because of our mission of making life better for Nigerians.

“Over the years, we have experimented with the people at the bottom of the pyramid, especially women, by providing equity type of financing for them to develop their small businesses so that the household income would improve and the welfare of the family be appreciated, with the children of those families benefiting as we see better enrolment of those children in school.”

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