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THE RUSSIANS ARE ALREADY IN NIGERIA!
EFCC, SSS, NIGERIA BUSINESS MEN BE ON ALERT. (PART 3)


WRITTEN BY BODE ELUYERA.
MOSCOW, RUSSIA.
abm1900@mail.ru


'RHINO' AIMS AT FOREIGN CONQUEST.


Dangerous. Unpredictable. Strange. Those are the three words that pop up in Western investors' minds when they think of the Russian business world, a top international consulting firm said Tuesday. And what image comes to mind? A blundering rhinoceros, apparently.

As Russian companies seek to invest abroad, they are increasingly finding that the cold cash they have accumulated from commodity sales and other businesses is not always enough to unlock the doors of Western markets.

Frustrated by that idea, several top business leaders and government officials argued at a round table Tuesday about how to streamline the country's foreign investment and who was to blame for the small international footprint of Russian business.

"Many Russian companies are not working in a professional way in international markets," said Boris Jordan, the CEO of the Sputnik Group, an investment and advisory company.

Jordan said even though the state actively supported some foreign deals, such as Severstal's failed bid for Arcelor this summer, government support was not enough to overcome the wariness of foreign investors about the lower levels of transparency and questionable corporate governance of Russian companies.


Yet, foreign investment will be crucial as Russian businesses seek larger markets for their products in comings years. "It's difficult to break through the borders to the customers; it's easier to buy a factory," said Alexander Livshits, head of international projects at Russian Aluminum.

From 2005 to 2010, Russia is expected to invest almost $80 billion abroad, second only to China among developing countries, according to a study by the Economist Intelligence Unit presented Tuesday.

To succeed at that level of foreign investment, however, Russian companies must overcome prejudices rooted deeply in the Western financial world. Only one in 10 global business leaders in the Economist study agreed Russian companies were "world-class competitors."

More than 80 percent of the business leaders surveyed said Russia could improve its image abroad by focusing on corporate governance, transparency and business ethics. Business leaders with experience working in the country were even more likely to highlight these qualities as weaknesses in Russia.

Tony Thompson, head of KPMG's Moscow advisory business, told the round table he had asked his London colleagues to describe their impressions of Russian companies the day before, and they came up with the words dangerous, unpredictable and strange.

Then he displayed on two monitors a drawing of the animal that he saw as summing up those qualities: the rhino.

On the bright side, Thompson said, Russian companies are starting to attract attention for their vision, decisiveness, and ability to generate cash for investors.

Business leaders at the round table strongly objected to what they saw as Western stereotypes, insisting foreign banks and bondholders would not lend their money to Russian firms without an acceptable level of financial disclosure.

"If somebody is afraid of something, he should stop reading Western newspapers," Livshits said.

But a recent report from Standard & Poor's said most Russian companies work to become just transparent enough for an IPO or a eurobond sale, but not more. Largely because of this, the average transparency score of Russian companies here increased only marginally, to 53 percent from 50 percent, over the last year.

Severstal's failed bid for Arcelor shows that though the blessing of the Kremlin may be more than enough to guarantee domestic deals, international mergers require a more nuanced courting of Western minority shareholders.

"For [Arcelor] investors, it was not clear why Severstal was proposing this. No one communicated with the shareholders," Jordan said.

But the business leaders disagreed Tuesday about how much the government was doing to support business at home and abroad.

"If somebody could work out the level of support of the Russian government for Russian business, it would be in the very last place," said Mikhail Delyagin, expert adviser to the Institute for Globalization Studies.

Billionaire Aeroflot shareholder and State Duma Deputy Alexander Lebedev agreed that the state had not been particularly helpful in dealing with recent business problems with the authorities in Ukraine. "There is no system that Russian companies can use -- it's not there," Lebedev said.

But Pyotr Aven, president of Alfa Bank, said: "We are not having any problems in Ukraine like Alexander was talking about." Alfa Bank owns a subsidiary in Ukraine.

Altimo, the telecom arm of Alfa Group, recently acquired a multibillion-dollar stake in Turkcell, Turkey's leading mobile phone provider.

"I don't deny that we have been helped," Aven said. "That was not possible to do without the government's support."

Livshits also said the government was helping the business climate.

"I fully agree with Pyotr -- the government is doing much more for business than it used to," he said.

Indeed, President Vladimir Putin recently met with Viktor Vekselberg, the principal owner of SUAL, just before the aluminum company announced a merger agreement with Oleg Deripaska's RusAl.

Sergei Kupriyanov, spokesman for state-controlled Gazprom, said his company had also benefited from government support in brokering domestic and international deals.

Still, Gazprom faced opposition from British ministers and others in Western Europe after reports that it intended to take over Britain's Centrica energy company.

"Somehow the possibility of acquiring Centrica irritated public opinion," Kupriyanov said.

In the long run, investors will become more comfortable with Russian companies making acquisitions abroad as they start to accumulate longer track records internationally, round table participants said.

"Investors are interested in seeing long-term, predictable scenarios," said Stanislav Naumov, director of economic analysis and planning at the Industry and Energy Ministry.

While the Severstal case shows how Russian companies are experiencing image problems in more mature markets, they may have an edge on their competitors in emerging markets, where business conditions more closely resemble those here, round table participants said.

Livshits said RusAl was a "young shark" that was more adaptable than the "old sharks" in developed countries.

The above is a report of a Moscow-based english language daily on the recently concluded round table discussion.
Theme: "Russian companies global expansion: source of capital or potential risk?"

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THE RUSSIANS ARE ALREADY IN NIGERIA!
             EFCC, SSS, NIGERIAN BUSINESS MEN BE ON ALERT. (PART 2)
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{tab=Part1}THE RUSSIANS ARE ALREADY IN NIGERIA! EFCC, SSS, NIGERIAN BUSINESS MEN BE ON ALERT. (PART 1)
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BODE ELUYERA.
MOSCOW.
abm1900@mail.ru

 According to Transparency International's Bribe Payers Index, released in the beginning of October, Russian businesses are among the quickest to offer bribes in promoting their interests abroad.

 Russian executives seek out partnership where bribery and corruption are the norm, said Yelena Panfilova, director of Transparency International in Russia.

 They have come to the conclusion that since they were so successful with those methods at home, they will be equally successful with the same methods abroad," she said.

 This year's Bribe Payer's Index, which was compiled from information submitted by more than 11,000 executives worldwide, found that two global anti-corruption initiatives - the United Nations Convention - have not been effective enough. Unsettling levels of bribery persist, the study reported, even among business executives from leading western nations.

 "The 'good' are not so good" ran the headline for one article in the study, which singled out the United States as a nation that has strong anti-corruption laws but does little to enforce them abroad for its own selfish interests.

 But  India, China and Russia, with scores of 4.62; 4.94 and 5.16 respectively - out of 10 highest - took the three lowest spots in the survey of the world's 30 biggest exporting nations, meaning that business people from these nations hand out more bribes in their dealings abroad than any other.

 The victims of this practise are the developing nations they deal with, Transparency International head Huguette Labelle wrote on the organization's web site. "bribing companies are actively underminig the best efforts of governments in developing nations to improve governance, and thereby driving the vicious cycle of poverty."

 Switzerland, Sweden and Australia with scores of 7.81, 7.62, 7.59 respectively topped the list. It is also worth noting that France; Israel; Italy; South Korea; Saudi Arabia; Brazil; South Africa; Malaysia, Taiwan and Turkey with scores of 6.5; 6.01; 5.94; 5.83; 5.75; 5.65; 5.61; 5.59; 5.41 and 5.23 occupy the 15th; 19th; 20th; 21st; 22nd; 23rd; 24th; 25th; 26th and 27th positions respectively.

 The last time the index was released, in May 2002, Russia was at the very bottom of the 21-country list. But Panfilova said she did not consider Russia's two-slot rise in the new ranking a real improvement. "More likely, this kind of corruption is frozen at the same level," she said.  "It is definitely not getting better."

 In the lights of this report, this article has set forth to analyse the negative implications for Nigeria: most especially on its economy and provide recommendations for our policy makers, the federal government, most especially The EFCC and THE SSS on how to minimise or prevent the risk of Russian business expansion into Nigeria.

 But before we proceed, it is worth noting that with this report, at least, the secret or the  myth about the trade success or aggressive economic expansion of the BRIC (Brazil, Russia, India and China) countries has now been revealed. It is now clear that there is much more to their success abroad than technological breakthrough or efficient management.

 Undoubtedly, all the relentless efforts of Ribadu and The EFCC in their uncompromised fight against corruption will be brought to naught or rubbished if the countries mentioned in the report, especially Russia; where the author resides and where the main focus of this article will  be,  use  bribery and other unethical means to do or secure business in Nigeria.

 Imagine if you  are pumping out 50 litres of water an hour from your flooded house, and a saboteur is pouring back 500 litres an  hour back. Definitely, under  such circumstances, your house will not only remain flooded, but things will turn out for the worse.

DAMAGE OF FOREIGN BRIBERY AND CORRUPTION TO THE ECONOMY.

 In general, the harm or damage foreign bribery and corruption can inflict on a country socially, economically and politically can not be over emphasized. The economic and commercial activities of the so called 'foreign investor' if not checked strictly, could destabilise our economy and make it dependent on external forces.

DUMPING.

 Dumping not only discourages local entrepreneurship but could as well render our industries uncompetitive, which in the long run could lead to closure of businesses and mass unemployment.

 The South African textile industry is yet to recover from the damage inflicted on the sector by the dumping of chinese cheap textiles. Quiet a number of South African textile factories were compelled to close down simply because they could not match the price of chinese textiles mass produced with the labour of chinese prisoners, and sold below market prices. The South African  government is debating a bill that will ban the export of Chinese textile products as the only remedy to save the industry from total collapse, before it is too late.

MONEY LAUNDERING.

 Money laundering - a process whereby millions or billions of dollars made illegally or through criminal acts is transferred out of the country  is another evil foreign bribery and corruption can bring. A country's economy could be paralysed in the process, and may not recover from the blow.

INFLATED CONTRACTS.

 Inflated contracts cost the economy billions of dollars that could have been used in improving the standard of living of the populace through provision of  more and better infrastructure, investment in industries, better health care service, salary increase e.t.c.

 In awarding contracts, due diligence is ignored, and in most cases, only the mediocre foreign companies that grease the palms of government officials are awarded lucrative consulting, construction or  supply contracts that in many cases could be performed better by Nigerian professionals and/or companies for a fraction of the price. Since practise makes perfect, thus, Nigerian professionals are denied the opportunity to learn and grow professionally.

 This act, undoubtedly is a threat to man power development, which is a prerequisite in order to achieve economic independence and prosperity.

 This particular issue is covered in details in one of my articles titled "Roger Dawson- American negotiation expert is a fake."

DRINKING/TAKING POISON.
 Millions of innocent Nigerians have paid dearly with their lives as a result of foreign bribery and corruption in the pharmaceutical sector. In the past, Indians and Chinese bribed our government officials and The Nigerian Customs so that they could turn a blind eye to mass exportation of fake drugs into the country. Millions of sick Nigerians bought tablets or drugs that they thought would cure them of their sicknesses and diseases. Unknowingly to them, they were buying  poison with their own money - which eventually sent them to their untimely deaths.

 Professor Duro Akunyili and her FDRCA deserve a lot of praise and commendation for the uncompromised war against the exporters of  fake drugs into the country.

FLYING COFFINS.

 Undoubtedly, the unprecedented number of plane crashes recorded in Nigeria is another consequence of foreign bribery and corruption. Nigerians connived with foreigners to sell planes that had already long been written off in the west, as not sky worthy, to fly Nigerians. Sky rocketed consulting and maintenance contracts of these aircrafts are awarded to foreign companies. Many of these planes later turned out to be 'flying coffins' which led to the tragic deaths of countless number of Nigerians. Plane crashes have not only brought sorrow and tears to many families, but have turned thousands of Nigerians into widows, widowers and orphans over night. The loose of the bread winner has suddenly changed the destinies of many for the worse forever.

LOSS HARD CURRENCY.

 Nigeria with its strategic location is a fishing haven for any foreign fishing company. Foreign fishing companies could bribe Nigerian officials to have uncontrolled and unlimited fishing rights. This act denies the country the capability to be self sufficient in food production or feeding its populace. In addition, the country is denied a very lucrative source of earning foreign currency. The author is convinced that if our fish industry is well managed, it is capable of generating hard currency comparable, if not more than what we presently earn from oil.

SECURITY THREAT. ENVIROMENTAL HAZARDS.

 Apart from economic threat, Uncontrolled and unmonitored access of a foreign company's fishing vessel to Nigeria's water could as well constitute security threat and enviromental catastrophe. Spying equipments could easily be installed at our coasts or shores to provide classified information to the country in which the foreign fishing company is based. Worse, polluted or radioactive could be disposed in our water. The magnitude of the health hazard this can cause the nation is even frightening to imagine.

 In a nutshell, foreign bribery and corruption is a threat to the economic security of a country.

 All things being equal, many of our trade partners want us to remain disorganised and underdeveloped, so that their products and services will always be in demand. It is in their interest for us to be in economic bondage so that they can continue to exploit us. In most cases, the so called 'foreign investor' invests a dollar in our economy, but makes profit running into millions of dollars and is taken out of the country with ease.

THREAT TO SOVEREIGNTY.

Perhaps, one of the most serious dangers foreign  bribery posses to a country like Nigeria is a challenge to its sovereignty.

 By sovereignty, I mean the ability of a country to make and impliment economic, social, military, security and political decisions - that reflect its interests - independently without foreign intervention or influence.

 The ability of a country to mobilise all the resources within its disposal: military, human, economic and political to defend its interest without any external intervention or influence is what really makes A STATE, and draws the line between a SOVEREIGN COUNTRY and A BANANA REPUBLIC.

 Transnational Corporations with turnover or capitilazation that dwarf the combined budgets or GDP of Nigeria and many African countries  can determine or influence the outcome of elections by sponsoring their protegee. When such a protegee gets elected, he makes policies that are in the interest of the foreign companies, but detrimental to his country; afterall, as the saying goes, he who pays the piper dictates the tune.

 The consequence of this is that the country loses its sovereignty; dejure it is an independent country but defacto, it is a puppet country or banana republic controlled remotedly from outside. Economic and political policies are dictated from outside. Unofficially, it turns into a colony that dances to the whims and caprices of its economic master(s).

THE RUSSIANS ARE ALREADY HERE.

 Since the construction of Ajaokuta metallurgy factory, the russians have been in Nigeria for long. However, Russia's presence in Nigeria took a new dimension with the acquisition of ASCOM by RUSAL - now the biggest Aluminium plant in the world,  -  after merging with another very big Russian aluminium company this month.

 Rusal is owned by Russian billionaire Deripasky - who is just under 40. We will take a detailed analysis of this deal in this article.

 Russian business men are presently trooping into Nigeria to cut deals both with the federal government and private businesses. This was confirmed during one of my recent conversation with a Nigerian diplomat based in Moscow.

 Nigeria, together with Angola, Algeria and South Africa were named by the Russian President in a russian monthly banking journal - that I read a couple of months ago - as the four African countries that are of first priority to Russia in terms of investments and business relationships.

 Unfortunately, our government and business men do not know so much about the 'modern Russia,' which has undergone an unprecedented social, economic and political transformation within the past 15  years since the break up of the Soviet Union. This lack of information about Russia put our government and business men at a very big disadvantage vis a vis their russian counterparts.

 Therefore, this article is also going to be a sort of guide for Nigerian business men who are already doing business or planning to do business with Russian companies.

 However, the main question we will try to answer in this article is "Is russian business expansion into Nigeria a source of investment opportunities or a potential risk?" The importance of this question even becomes timely and very vital in the lights of The Transparence International Bribery Index report.


                           TO BE CONTINUED

Robot  # 1 | 02.11.2006 05:32

Is russian business expansion into Nigeria a source of investment opportunities or a potential ris...Read the full article.

Oghre  # 2 | 02.11.2006 09:07

Let me say that no one can commit crime in a highly criminal charged society like Nigeria, The Lebanese who continue to print our currency and flood the economy with it did so with the full connivance of Nigerians, they also did not single handedly use our young men and women to ship drugs out of the country on their own. The Indians are also here, as sneaky as they are, Nigerians help them in their nefarious activities. Foreigners continue to bastardise our economy everyday with the full help of government and Nigerian law enforcement officials. It will be no different with the Russians, let them come, Nigeria is NOW FREE FOR ALL. Everyone from Mongolia to Timbuktu, please feel free to go to Nigeria, if you have a little light skin you will just be mistaken for a white man and called master everyday while you help to bastardise the nation of Nigeria.