By Chinelo Obogo, [email protected] 07064781119
As 2021 comes to an end, the aviation industry was forced to contend with the impact of the COVID-19 pandemic and recession which, experts say, is the worst since 1983.
But as the industry recovers, it has also seen the commencement of plans by the Ministry of Aviation to concession four international airports, announcement of date for the setting up of a national carrier, acquisition of new aircraft by airlines, impasse on NG Eagle and the aero, politics of the bilateral agreement between the United Arab Emirates and Nigeria among others.
When the Minister of Aviation, Hadi Sirika, took office, he disclosed that airport upgrade is part of his aviation masterplan and sought to revamp the industry through the active participation of the private sector and make it self-sustaining. Some of the core objectives of his aviation masterplan is to establish a national carrier; have a ready maintenance, repair and overhaul centre; establish an aviation leasing company; establish five-airport free zones; and the development of an agro-allied cargo terminal.
So far, the rehabilitation of Abuja Airport runway has been done, work on the decrepit Akanu Ibiam International Airport, Enugu, has been completed and provision of critical safety tools for many of the nation’s airports.
By the time the Federal Government lifted flight restrictions, many airlines were unable to meet up with the flight demands due to the fact that many of their aircraft were stuck in Maintenance, Repair and Overhaul (MRO) centers around the world. To meet with the demand, airlines like Air Peace begun bringing in brand new aircraft from the orders that they had previously placed, while others had to wet lease more aircraft. The Federal Government also helped by injecting N5billon bailout funds into the industry and airlines got to share N4 billion out of the money that was made available.
Unlike international travel, Nigeria’s aviation industry is bouncing back to its pre-covid state according to the Director General of the Nigerian Civil Aviation Authority, Capt. Musa Nuhu, who said the industry has recovered. “We certainly have recovered from COVID-19 pandemic and have exceeded the pre-COVID-19 level. Nigerian airlines have been getting clients. Right now, I have about 10 to 12 aircraft on wet lease to fill in the gap of the demands of the system. So, the industry has done fairly well. The domestic industry is growing in a fantabulous rate. We have given a lot of Air Operators’ Certificates (AOC) and we still have about 15 in the pipeline. We are working on it.
“We have airports propping up all over the place and a lot of maintenance organisations coming up. For us to achieve the growth we have now, we (agencies, ministries, stakeholders and the media) are doing something right that is building investors’ confidence in the system. The investors are willing to put their money in the system and grow the industry. We will continue that way. And hopefully, we want to get to a place where aviation plays very significant contributions to the GDP on a short and medium terms; at least five per cent. Also, the growth is a bit stretching the infrastructure. So, sometimes, clogs are created here and there because the system has been stretched,” Nuhu said.
One of Sirika’s master plan when he came into office is the concession of four international airports. In a zoom meeting earlier in the year, he pointed out that international airports in Lagos, Abuja, Port Harcourt and Kano were not designed as international facilities and due to paucity of funds to undertake the repairs, the prospective private handlers of the terminals and facilities will improve the airport infrastructure. He also said that the Federal Government is committed to upgrading the airports in the country and making them viable through concession.
“The airports in Nigeria are currently operating in a suboptimal environment as there is relatively low asset utilisation due to the limited opening hours of other smaller Nigerian airports; lack of terminal capacity as the airports fall short of gates, stands and check-in desks. An overstretched facility is the Murtala Muhammed International Airport, Lagos terminal, built in 1979 for 200,000 passengers, but currently processes nearly eight million flyers,” Sirika said.
This year, however, the ministry opened bids for the concession and many companies have indicated interest even though stakeholders are pushing for local companies to be given priority. Despite support for concession from a section of the industry, aviation unions have strongly opposed it, insisting that it would worsen the financial crises facing the Federal Airport Authority of Nigeria (FAAN) and kill 18 other airports scattered over the country which depend on the major international airports for sustenance.
The unions say FAAN would be made to bear the repayment of the $1 billion loan utilised to build the terminals, continue to fulfill its financial obligations to staff and pensioners, remit 25 per cent of its revenue to the federation account and maintain the remaining 18 airports in Nigeria. Sirika, however, allayed the concerns raised by the unions, insisting that concession is the best approach to ensuring the development of the airport facilities.
Three years after the Federal Government announced plans to establish a new national carrier after the liquidation of the Nigerian Airways in 2003, Sirika announced recently that the proposed carrier will begin operations in April 2022.
He told House correspondents at the end of a virtual Federal Executive Council meeting that the Federal Government would own not more than five per cent equity stake in the national airline and that the airline would be capable of providing 70,000 jobs. He said Nigerian investors will own 46 per cent shares while international strategic partners will own 49 per cent stake and that the outline business case has been approved by the Council.
The minister explained that the airline would start operations with three wet-leased aircraft and then continue to expand, place orders and then get deliveries. He assured that the Maintenance, Repair and Overhaul facility for the carrier and others would begin in Abuja next year and that partners for the MRO had been approached and once approved by the Federal Executive Council, work would start in April 2022.
After Sirika revealed that the national carrier will commence in April 2022, aviation experts cast doubts on the viability on the proposed venture. The Chief Operating Officer of Tropical Arctic Logistics (TAL) helicopters, Femi Adeniji, told Daily Sun that he believes the rush to start a national carrier only serves the minister’s personal interests as there are still many unanswered questions.
“Although, the Minister could instruct the Director General of the Nigerian Civil Aviation Authority (NCAA) to issue Nigeria Air and Air Operator’s Certificate (AOC) without meeting the prerequisite of having the AOC which procedure we know is cumbersome with NCAA, where is the infrastructure such as office? Where are the post holders? The documents? Would it be copy and paste as usual by the NCAA inspectors? If all these are provided, where are the workers and facilities put on ground to make anyone believe that the national carrier would be birthed as proposed?” he queried.
Chief Executive Officer (CEO) of WestLink Airlines, Captain Ibrahim Mshelia, said that it is impossible for a new airline with three aircraft to employ 70,00 people as the Minister promised and also questioned how Nigeria Air will get its Air Operators Certificate within five months when it takes other airlines as much as two years to get theirs.
“How do you want to start an airline that has not been registered? It would take a minimum of 12 months to register an airline when you know the name even with government leverage because there are incubation periods for some of these certification processes. You need to register and when the CAC gives you registration certificate, you need to apply for Air Transport License (ATL) if they will be doing scheduled operations. After the vetting, you will place an advert for 28 days so that anyone who has an issue with the licensing of the ATL to that applicant can come up with reasons. They are not going to jump the process because it is a Nigerian project, we will not allow that plus we are a category one CAA, they should not dare do that, otherwise they will lose that status,” he said.
Nigeria Air vs NG Eagle
While the controversy over the viability of the proposed national carrier continued to generate debate, no one knows what has become of NG Eagle, the carrier being floated by the Asset Management Corporation of Nigeria (AMCON) out of the existing Airk Air and was supposed to commence in 2021. The question being raised is how the Federal Government would own two carriers; NG Eagle and Nigeria Air and many are wondering why the Ministry of Aviation doesn’t want to collaborate with AMCON to establish one carrier and use the aircraft already on ground instead of working at cross purposes.
In a recent interview, Sirika said NG Eagle may find it difficult to get its AOC from the NCAA because AMCON owes over N235 billion to different agencies. The corporation already has three aircraft on ground ready to commence operations but it is yet to get its AOC from the NCAA because of its debt.
UAE vs Nigeria diplomatic row
The event that took over most of 2021 and would shape the bilateral aviation agreements between countries is the row between the United Arab Emirates (UAE) and Nigeria over COVID protocol and the initial refusal to give Air Peace slots to Dubai
Under the Bilateral Air Services Agreement (BASA) pre-COVID-19, Emirates Airline was operating 21 flights weekly to Nigeria but because of the capacity of Nigerian airlines, only Air Peace out of the designated airlines was operating to Sharjah three flights weekly. When COVID-19 came, all flights stopped and operations resumed a few months later and was also disrupted due to UAE’s COVID protocols, which the Nigerian government felt was discriminatory and Emirates was stopped from operating into Nigeria. It took negotiations for the flights to resume after nine months.
Emirates sent a winter schedule, which was agreed pre-COVID; 14 to Lagos and seven to Abuja weekly and Air Peace went to Sharjah and wanted to resume but was told by the UAE that they could only get one slot. The FG immediately retaliated by banning Emirates until the UAE provided seven slots for Air Peace to fly to Dubai. After the diplomatic row was resolved, Capt Nuhu said that the FG is working on commencing a slot system which would ensure domestic airlines are not shortchanged.