NIGERIA is tightening rules against investors in a move analysts say is evidence of a government struggling to cope with fiscal pressures in the face of plunging oil prices, creating more unpredictability for Africa’s biggest economy.

MTN Group Ltd. was fined $5.2 billion by Nigeria’s telecommunications regulator last week, more than 20% of the mobile-phone company’s market value, for failing to comply with an order to disconnect customers with unregistered phone cards.

In the same week, regulators also imposed big fines on Standard Bank Group Ltd.’s Nigerian unit, United Bank for Africa Plc and First Bank of Nigeria Ltd.

“It’s worrying, the bank fines, the telecommunication fines,” Clement Nwankwo, executive director of the Policy and Legal Advocacy Centre, said by phone on Monday from Abuja, the capital. “I don’t get the sense what the economic direction is. If Nigeria is broke and agencies are fining companies to make up for the shortfall in oil revenues then that is something that we should be worried about.”

Nigeria has no finance minister or clear economic policy five months after President Muhammadu Buhari took office on pledges to combat corruption, end an insurgency by Boko Haram militants and bolster the economy.

He has had to do that with dwindling resources after oil prices fell 55% since June last year. Nigeria is Africa’s biggest crude producer, with oil making up more than two-thirds of government income.

MTN slump

“The fiscal headwinds facing Nigeria has resulted in an increasingly assertive regulatory regime in Nigeria,” Martyn Davies, managing director of emerging markets and Africa at Deloitte & Touche in Johannesburg, said in an e-mailed reply to questions. “These fiscal pressures are resulting in greater pressure on companies, local but particularly multinational, to comply.”

MTN shares have slumped 22% since Oct. 26, when the company said it’s facing a fine. Trading in the stock was halted temporarily in Johannesburg on Monday after earlier dropping as much as 9.7%. It resumed after the company published a statement confirming it’s still in talks with the Nigerian Communications Commission on resolving the matter.

Tony Ojobo, a spokesman for the NCC, said on Oct. 29 that investors are required to comply with the rules or face penalties. He said on Monday that there’s no update to be disclosed on the MTN fine.

Femi Adesina, a spokesman for Buhari, said by phone the MTN penalty is not a matter for the Nigerian presidency, referring queries to the NCC.

The penalties signal “that the new government is serious about compliance, which, over the medium term, should be beneficial for business,” Cobus de Hart, an analyst at NKC Independent Economists, said by phone from Paarl, near Cape Town. “However, given the understandably fickle investor sentiment currently in the country, being too strict too quickly will adversely affect the business environment and investors may become even more anxious.”

Investor confidence has slowly eroded this year. In September, JPMorgan Chase & Co. said it will remove Nigeria from its emerging-market bond indexes, as foreign-exchange restrictions imposed by the central bank to help stabilize the naira and reserves caused liquidity to dry up. Buhari has backed the central bank’s currency controls even though it’s hurting importers and growth in an economy that expanded at its slowest pace this decade, at 2.4%, in the second quarter.

Buhari is yet to disclose the portfolios of his 36 cabinet nominees, who were all approved by the Senate last week during confirmation hearings.

“Certainly it is important that the regulatory agencies are active and taking action against companies that violate the rules of business,” Nwankwo said. “But it is always useful that this be done in the context of a national economic policy.”

-Bloomberg


http://mgafrica.com/article/2015-11-02-nigeria-broke-and-buhari-using-mega-fines-on-mtn-banks-to-raise-money-analysts-think-so-and-that-worries-them

Yes

..

Ok

A. “However, given the understandably fickle investor sentiment currently in the country, being too strict too quickly will adversely affect the business environment and investors may become even more anxious.”

In South Africa, can businesses fickle with their national security?


B. “..........But it is always useful that this be done in the context of a national economic policy.”

What is the job of a regulator? Can businesses operate properly within lax regimes and poor administration?

That is a message to anyone doing business in Nigeria. Flout orders at your own peril. This should be extended to road construction and power supply.

Ok

These companies have started their campaign of slander.

Just because we are broke doesn't mean your fine is for our budget....rules and fines are what make an economy vibrant

I'm so happy about the "mtn fine"!

Stvpid "money thiefing network"!

Buhari is wrong on this. Why would he use his executive power to be robbing Establishments ?
So sad he is still thinking like a dictactor

The question is, are they not guilty? We need to do something to checkmate the misleading reports our mediae. Yes of course, Tax and fines/levies are part of what constitutes federal revenue.. If you want to invest in any sector, you have to comply with the rules. For God sake, this is not Pdp government where things were not in order.

No nonsense government

bolabolakemi:
Buhari is wrong on this. Why would he use his executive power to be robbing Establishments ?
So sad he is still thinking like a dictactor

Then you clearly haven't been using MTN!!!!
Asides that, you disregard a direct order, you pay..
Simple!!!!

bolabolakemi:
Buhari is wrong on this. Why would he use his executive power to be robbing Establishments ?
So sad he is still thinking like a dictactor

Mummy, how is he robbing them. Our country can't develop if we continue thinking like this, ''no offence''. These companies failed to comply and they were sanctioned. The era of petting thieves and harboring impunity is over . Every individauls, governmental or non gocermental agencies must at all levels must obey and respect the rules, law and regulations of the land.

mazeltov:
Mummy, how is he robbing them. Our country can't develop if we continue thinking like this, ''no offence''. These companies failed to comply and they were sanctioned. The era of petting thieves and harboring impunity is over . Every individauls, governmental or non gocermental agencies must at all levels must obey and respect the rules, law and regulations of the land.

You're so on point. These companies will continue to disrespect us if we don't send a strong message like this that the days of impunity are over in our country. Henceforth, they have to play by the rules. I'm surprised that a local communication network like GLO network fully complied with the rule and regulations while a foreign company like MTN that's suppose to know better deliberately chose to ignore our regulatory bodies just as they've done for the past 16years of PDP rules. Even after negotiations, they MUST pay atleast 50% of the fine.

cant dey just forgive MTN for once? 5.2b dollars is too much joor, or is it becos d company is nt own bt a nigerian? africans and bad bella.

abeg make una like my pix. just click d link and like d pic der. yur like can help me win.. tnks alot...

https://m.facebook.com/www.mrteenanambra.co.za/photos/a.1464051870554934.1073741826.1464048683888586/1511830595777061/?type=3&source=56

nonsense

Rules and Regulation are meant to be obey.
You break the rules , you face the consequence.

ID!ATS! Truth is, those South African companies don see us finish. They flout rules as though they are pleas. That's how sometime back, DSTV disregarded court orders by refusing to review down their subscription fees which was pending an injunction. See it as you may, but no sane country will allow such disrespectful acts in her backyard let alone a frontal one as these. They must pay up or fold up, there's only one way out!

victorjam:
cant dey just forgive MTN for once? 5.2b dollars is too much joor, or is it becos d company is nt own bt a nigerian? africans and bad bella.

abeg make una like my pix. just click d link and like d pic der. yur like can help me win.. tnks alot...

https://m.facebook.com/www.mrteenanambra.co.za/photos/a.1464051870554934.1073741826.1464048683888586/1511830595777061/?type=3&source=56

Abi you dey contest for MTN Project Fame?

As long as that's in enclave of the law of the land, he has my 'unflinching' support.

NCC fined MTN for failing to comply to their agreement.
MTN refused to deactivate some sim cards without registration, such sims are being used for crime.

MTN deserve more than that.

Ciscogod:
NCC fined MTN for failing to comply to their agreement.
MTN refused to deactivate some sim cards without registration, such sims are being used for crime.

MTN deserve more than that.

How do you register 62m sim cards within 6 months, this law was impliment just to catch more especially MTN, not only did all the networks comply, the NCC statement clearly stated that other networks did not fully comply also, so the question is why weren't they charged? its clearly show that MTN was the main target and they fell for the trick, bad management on the side of MTN. Heads will roll after all this drama.

We do not care whatever the media decide to write.

The gaunt has been let down --- there is any new government and sherrif in town that will not take nonsense from any one because this government does not take bribe and it also recognises stealing as corruption. This government will never open our barn.of yams to the goats.

US has been fining companies that erred billions of dollars, we never saw this kind of report.

If up holding our law is raising funds, so be it. Laws are meant to be respected by all, most especially socially responsible companies. When you break the law, you must be ready to bear the consequences.

MTN repeatedly violated NCC rules with impunity, putting out nation under security threat. Kidnappers and boko harams were using their networks for fun. That is aiding and abetting of a crime. The top management of mtn ought to be jailed.

14:


How do you register 62m sim cards within 6 months, this law was impliment just to catch more especially MTN, not only did all the networks comply, the NCC statement clearly stated that other networks did not fully comply also, so the question is why weren't they charged? its clearly show that MTN was the main target and they fell for the trick, bad management on the side of MTN. Heads will roll after all this drama.

If the lines were disabled today, I can assure you all concerned people would have registered their lines within 6weeks.

Are people not registering for BVN by force?

bolabolakemi:
Buhari is wrong on this. Why would he use his executive power to be robbing Establishments ?
So sad he is still thinking like a dictactor

Ode..Buhari os NCC now?

14:


How do you register 62m sim cards within 6 months, this law was impliment just to catch more especially MTN, not only did all the networks comply, the NCC statement clearly stated that other networks did not fully comply also, so the question is why weren't they charged? its clearly show that MTN was the main target and they fell for the trick, bad management on the side of MTN. Heads will roll after all this drama.

We all know that MTN was used as Lamp of God to carry the sin of others. But my bro. I no pity MTN