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 Nigeria Air: Doomed On Arrival  Nigeria Air: Doomed On Arrival

The Nigeria Air project has generated more polemics than any other government policies in the Nigerian aviation industry. Stakeholders in unison say the airline is doomed to fail before it begins.

  The plan by the Federal Government to birth a new national carrier for Nigeria before the end of the year has generated more controversies than ever envisaged by the promoter of the project.

Apart from the fact that the choice of Ethiopian Airlines, which many see as a direct competitor to the impending Nigeria Air, over 90 per cent of players in the country’s aviation industry, still says everything about the national carrier is shrouded in secrecy, while the government wriggles to convince the public about its intent.

In the globe, there is a debate around whether national carriers are still relevant in today’s ultra-competitive market. Many of the hitherto national carriers have either transformed to flag carriers or shut down operations.

The former leading national carriers, Malaysian Airways, Alitalia, Kenya Airways and South African Airways among others are all in debts, only surviving on continuous government interventions.

The Nigerian aviation industry is volatile for the domestic operators. Many of them are struggling to remain in business with the myriad of challenges like scarce foreign exchange, skyrocketing price of Jet A1, multiple entries for foreign airlines, duplicity of charges and levies limiting their growth, while government support is almost unavailable.

When the national carrier project was first mooted in 2016 by the Federal Government, most industry stakeholders, including tourists, applauded the idea, but many of the players said its recent framework of implementation was short of expectations, especially its partnership model, which they said would work against the interest of local operators that have invested heavily in the sector.

The public is also curious to know the shareholding equities of other shareholders like the Skyway Aviation Handling Company (SAHCO), MRS and the value of Ethiopian Airlines 49 per cent in the project.

The industry players also emphasised that a similar arrangement between Virgin Atlantic Airways and Virgin Nigeria failed despite the preferential treatment given the airline, and advised the Federal Government against entering similar ventures, which they said may not outlast the present government.

Already, the airline has a footmark in eight African countries; Chad, Malawi, Zambia, Mozambique, Cote D’Ivoire, Guinea, Togo and Democratic Republic of Congo as shareholders in those countries’ airlines.

Speaking on the issue, Capt. Mohammed Badamasi, industry analyst wondered how Sen. Hadi Sirika, the Minister of Aviation could be the only one making such a sensitive decision on a national carrier for the country.

Badamasi emphasised that in the annals Nigeria, there was no Presidential Adviser in the presidency in the past seven years, unlike in the past where critical issues like national carrier and other major issues on the industry are deliberated upon by the industry technical personnel in the presidency.

He also queried the essence of the approval of the Federal Executive Council (FEC) for the deployment of three startup aircraft for Nigeria Air and further quizzed the 5 per cent stake of the Federal Government in the entire business.

Already, Badamasi explained that Ethiopian Airlines is operating direct flights between Lagos (Nigeria) and London (United Kingdom), even without the commencement of the partnership between the two countries.

He attributed the recent wrong decisions taken on the industry to the ineptitude of some who are given critical roles to play in the industry, but expressed the hope that some of the wrong steps taken by the government would be upturned by succeeding governments.

He said: “The government should avoid those who have shown interest in becoming a post-holder in any of the government agencies in aviation. There are seasoned people in the industry who have no interest, other than how to be a part of history in the birth of a viable airline carrier for the country.

“When you have the wrong people in the right places, this is the result you get. I have said it before and I’m saying it again, another wrong foot in the wrong direction. Only a mediocre person will not see that there is no light at the beginning of the tunnel, and start searching for it at the end of it. I pray that God should correct their mistakes. I cannot wait for the end of the tenure of this meddler, running the ministry.

“Presently, the aviation industry in Nigeria is on life support. All hands must be on deck to bring it back to life. The current leadership of the industry; especially the Ministry of Aviation, lacks the vision and expertise to correct the mess they have made.

“This administration has finally crippled the domestic airlines, by giving Ethiopian Airlines free hands to take the Lagos/Heathrow/Lagos routes, even before forcing Ethiopian Airlines on us. This gift is in addition to the multiple destinations into Nigeria the airline enjoys.”

Capt. Roland Iyayi, Chief Executive Officer (CEO), Top Brass Aviation Limited, explained that the domestic airline operators are operating in one of the most hostile environments in the world without notable support from the government.

Iyayi insisted that if the planned national carrier was subjected to the same conditions of the domestic operators, the airline would fail and collapse sooner than later.

Iyayi declared that the Federal Government failed to learn from the past mistakes, which gave out numerous rights and privileges to Virgin Nigeria, emphasising that as it stood, Nigeria was not benefiting from the current structure.

He advised the Federal Government to discontinue with the plan and support the indigenous airlines to grow.

Iyayi pointed out that the interest of Ethiopian Airlines was to capture the African market especially with the Single African Air Transport Market (SAATM), propagated by the African Union (AU).

“We need to learn from the past, we had Virgin Atlantic in Virgin Nigeria. Virgin Atlantic came in more or less the same structure; initially it provided $3 million that was put in the Central Bank of Nigeria (CBN). When the time came to operate, they curled back the $3 million, brought in all their aircraft, leases were made to Nigeria and the leases were beyond market value.

“Terminals are being set aside as we speak for Nigeria Air. Domestic airlines need office spaces at airports, but we rarely have them. We talked about the Single African Air Transport Market (SAATM), it is necessary to understand.

“What Ethiopian is trying to do in essence is to make sure they have a hold on the largest aviation market on the continent, to be able to project and propel themselves,

  OCTOBER 30, 2022

not Nigeria. If anybody is taking time to read through the Ethiopian 2025 Vision, …. Essentially today, they have more than 135 aircraft and they hope to double it to 250 aircraft in the next five years.”

Sindy Foster of Avaero Capital Partners said that Ethiopian Airlines is a strong carrier on the continent, but doubted its success with Nigeria, especially when the carrier is the majority shareholder with 49 per cent.

She also doubted if this agreement would lead to the development potential of Nigerian aviation industry, particularly if growing the Nigerian aviation leads to reduction of traffic and income for Ethiopian Airlines businesses, including its 100 per cent owned airline, airport, Maintenance, Repair and Overhaul (MRO) facilities and engineering among others.

She said: “Countries would be within their rights not to allow designation of a foreign owned and effectively controlled national carrier to operate Nigeria’s Bilateral Air Service Agreement (BASA) routes. The way business is done in Ethiopia and the way business is done in Nigeria may itself lead to cultural clashes.

“It sounds like Ethiopian Airlines was the only choice for a technical partner and core investor. This decision is more a case of meeting an election pledge than creating a national airline effectively owned and controlled by Nigerians, and which Nigerians can be proud of.”

Also, Mr. Olumide Ohunayo, the Assistant General Secretary, Aviation Round Table, said the deal with Ethiopian Airline was a setback for Nigeria.

He also emphasised that though, Ethiopian Airlines had been a successful carrier in Africa, but its partner carriers on the continent like Congo Airways, Tchadia Airlines, Zambia Airways and others, except Asky Airline, which just upped its fleet of aircraft to about 12 had all failed.

Besides, Grp. Capt. John Ojikutu (rtd), the Chief Executive Officer (CEO) of Centurion Security Limited, said similar partnerships in the past by the defunct national carrier, Nigeria Airways with KLM and South African Airways in the early 1990s did not benefit Nigeria.

Ojikutu further explained that Ethiopian Airlines had the unenviable record of ferrying drug traffickers along most of its routes and warned Nigeria to be careful of its choice of the airline.

The Federal Government had last month mentioned Ethiopian Airlines as the technical partner and core investor in the formation of Nigeria Air.

Also mentioned are the Skyway Aviation Handling Company (SAHCO) Plc, MRS and other institutional investors with 46 per cent while the Federal Government retained its 5 per cent, making it a total of 100 per cent shares.

Source: independent.ng