Nigeria Air: Investors say drive for airline unclear, question rationale behind ETs 49% stake
Stakeholders met virtually last week to air their thoughts on the ongoing Nigeria Air project at the inaugural aviation town hall meeting hosted by Avaero Capital Partners. The general take away from the meeting is that of disappointment at the handling of the project. Strong views on the airline’s ability to employ Nigerians, its ownership structure and drive, its strength and more importantly its survivability in the long run were expressed. ANTHONY OMOH sums up some key arguments.
Players in the aviation industry have continued to express fear with the announcement of Ethiopian Airline as 49% investor in the Nigeria Air project and still want to know beyond aircraft lease which may still cost the nation, what the carrier brings to the table.
This is just as a lot of them have said there are ulterior motives at play and that the airline unveiled at Farnborough Airshow since 2018 despite all airs around it does not have the national interest at core and may end up creating more problems for Nigeria in the long run.
Even the proposed 70,000 job creation for Nigerians was punctured and described as unrealizable with question bordering on how the jobs can be created with three (3) leased aircraft from an airline that will most likely provide crew for the equipment thereby limiting Nigerian participation.
These opinions were shared at the inaugural aviation town hall meeting Nigeria Air: Solution to Nigeria’s Aviation Problem? Hosted by Principal Manager Avaero Capital Partners, Sindy Foster.
Managing Director/ CEO, Topbrass Aviation Limited, Mr. Roland Iyayi said the entire process of selecting a strategic investor for the Nigeria Air and all issues surrounding the carrier has been shrouded while certain individuals are setting up an airline using government as a face.
Iyayi agreed that the country needs a national carrier to reciprocate all BASAs routes but the manner and the process adopted for this current project so far is wrong.
He said,“This is an airline being set up using government as a face but owned by private individuals that is my contention and I think on that basis, it should be stopped and a more transparent process should be put in place because there is a need to reciprocate all our Bi-lateral Services Agreements, BASAs and Multilateral Agreements in different countries but it should be done in a way that gives the benefits of commonwealth to all and not to a few”.
On Ethiopia as strategic investor, Iyayi stated that having a partner is not bad but certainly not a competitor that already has a stronger footing than Nigeria especially one that has always had an eye in the Nigerian market with the many attempts made in the past to take it citing Ethiopia airlines approach of Air Peace and being a clog in the will of progress when they blocked Arik Air from operating into Ethiopia.
“Ethiopia will never allow a Nigerian whoever that Nigerian airline is coming out of Nigeria Air to compete, they are not stupid, they know what they are coming to do and they know exactly what they want. And for the records Ethiopian approached Air Peace to have a footprint in the domestic market in Nigeria, such that they were willing to pay Air Peace royalties, Ethiopian tried the same thing in 2018 with Ghanaian Authority and they were thrown out.
“So the point is, if Ethiopia with all the antecedents in 2017 they block Arik Air from flying into Ethiopia, they did the same thing again to Air Peace in recent times so, if they are doing all of this to protect their own market and for us to now say come into our market with unfettered access, I believe this is the worst thing that can happen to the Nigeria industry”.
Chairman, West Link Airline, Captain Ibrahim Mshelia while noting that having a National carrier was a welcome development but said the way they are going about it is not right.
He noted that, Ethiopian Airline is supported by their government to progress, the same thing Nigerian operators have been requesting for decades which is the reason for the Niger Air in the first place.
Mshelia argued Nigerian airlines have been successful both domestically and in the sub- region with little or no support from government and stressing further that the reason there is a blocked funds challenge is Nigeria’s inability to reciprocate the BASA or at least make money from it and use that to develop the country’s aviation.
Captain Mshelia said:” I am an advocate of seeing Nigerian airlines fly all over the world, it doesn’t matter if it is a national or flag carrier. National or flag carriers are necessary, however, like you rightly pointed out, the way we are gong about it is so new and so fresh and the reason it is being done that way is that there is a hidden interest and no transparency as you have seen. The project is going to suffer and is going to add to our industry problems.
On the ownership structure of the airline he said,” I would have loved o see in the first place, the ownership of the airline. We would have loved to see an airline like Air Peace doing well take 25% of this new airline but what we are seeing, Ministry staff and who are those Ministry staff? These are question begging for answers.”
Chairman United Nigeria Airways, Professor Obiora Okonkwo in his submission declared that what the industry needs is a little support from government, same support Ethiopia is getting from their country, stating that with that domestic airlines can do more and compete beyond the region.
He said what Nigeria has done with regards granting entry rights all over the country was not done and that even the United states has laws limiting people from taking advantage of their market while protecting their local carriers. Professor Obiora said,”We do not see anything Nigerian in this Nigeria Air, from our information we believe it is a camouflage of interest. We do not think this is the best thing happening. It is not genuine. We reject it. Nigeria Air will not suffer any fate different from what befell the defunct Virgin Nigeria that could not go to the United States. This is clear in the Bilateral Air Services Agreement regulations.”
“What this industry needs is support, with a little bit of support which Ethiopian is geting in their own country we can do a lot more. We don’t believe that this Nigeria Air is for the interest of the country. Ethiopian airlines are bringing three aircraft on wet lease to United Nigeria and would be giving you 300 hours a month and they take away hundreds of thousands but that does not give them a right to be a shareholder in my company so why should we be talking about that?
“When government was talking about national carrier we thought they were talking about a situation where they would sign for 10 new Boeing aircraft and 10 new ERJ aircraft and they come in brand new, its a shame and very mundane to be talking about national carrier in this modern times, I agree with most people who talk about flag carriers as government continues to underestimate, the national security nature of airlines.
On the projected 70,000 jobs for direct and indirect employment, stakeholders lampooned the idea stating that they are being bandied to justify the project stating that the airline aircraft would be registered and flagged in Ethiopia meaning, all the technical crew will have Ethiopian licenses stating that it is what is happening to ASKY in Togo and concluding that it means no job for our technical crew in the foreseeable future.
“There’s no airline that will employ 70,000 people not even for direct or indirect jobs but in anyway, numbers has to be bandied in other to justify the project.”
