- Court Refuses EFCC Evidence In Arik Air N76bn Aircraft, Property Sales Case
- Kenya Airways mulls return to Abuja, weighs options
- Developing Nigeria’s aviation local content policy with ‘Fly Nigeria Act’
- Qatar Airways Launches Additional Flights to Global Destinations
- NSIB, Aero sign strategic aviation deal
FG to assist airlines overcome challenges
Osinbajo meets operators Nigerian airline operators’ woes could come to an end as Acting President, Prof. Yemi Osinbajo said Federal Government has concluded plans to assist them by addressing challenges that have hampered the growth and development of the sector, and hindered it from taking advantage of its natural geographical
The assistance is expected to come in reduction or harmonisation of over 35 charges levied against airlines, which they described as outrageous and a threat to their business.
Other area of urgent assistance is availability of aviation fuel, otherwise known as Jet A1 which is not only unavailable but very expensive.
Aviation fuel costs more in Nigeria and other oil producing countries than their counterparts that do not produce oil.
For instance, in Nigeria, despite the stability in the lifting of aviation fuel across the country and the deregulation of the commodity, JET A1 has hit an all-time high of N198 per litre.
The skyrocketing price of JETA1 in Nigeria has added more to the pains of airlines, which use 30 per cent of their revenues for fuelling aircraft.
While the specialised fuel is sold for about $2.30 cents per gallon in Nigeria, $2.30 in Benin and $1.94 cents per gallon in Cameroon, it is sold for close to $3.14 cents in Ghana, which also produces oil. In Luanda, Angola (also an oil producing country), it costs $3.75 per gallon; Libreville $2.05 per gallon; Khartoum, Sudan $2.44 per gallon.
It is only Equatorial Guinea that sells JET A1 for $0.46. Jet fuel prices in some African capitals are double the global average and it is posing a threat to its aviation sector development.
Osinbajo gave the assurance during a meeting in his office at the Presidential Villa with a delegation of Airline Chief Executives of the Airline Operators of Nigeria (AON) with a view to finding solutions to the myriads of issues affecting them and one that has shortened their lifespan to less than ten years.
He used the meeting as a fact finding exercise to hear first-hand from the airline investors what domestic airlines are going through within the sector and to discover why in spite of the huge potentials as a country blessed with a natural God given geographic location at the centre of Africa (4.30hrs to most parts of Africa); with most of its airport at approximately sea level, being the 6th largest producer of crude oil (JetA1), a human population of 180 million, and skilled manpower, yet Nigeria is not a hub for aviation activities on the African continent.
Lending voice to the challenges being faced by airline operators, the Chairman of AON, Sir Nogie Meggison said that some of the major issues facing airlines currently include, but are not limited to the following: removal of Value Added Tax (VAT) as domestic airlines are the only mode of transport paying VAT – Marine, Road, Rail and even the International airlines don’t pay VAT); harmonization of over 35 Multiple Charges; reviewing five per cent Ticket Sales Charge (TSC) to a flat rate in line with the world practices; poor navigational and landing aids, high cost and epileptic supply of JetA1, obsolete infrastructure, limiting operations to daylight operation for most airports.
Nigerian airlines fly an average of only five hours as against the average of 10 hours worldwide per airplane; and lack of consultations with airlines before introduction of new charges and policies among others, they said have done incalculable damage to their operations.
According to Meggison, “There is an urgent need for a deliberate economic policy that will support the positive growth of aviation and survival of domestic airlines in the country. For instance, following the air crashes of 2005/06, government came up with a policy to ensure air safety”.
He asked that the economic policy for the sustenance of the industry needs to be seriously looked into, adding that safety and economic policy go hand-in-hand.
Meggison stated that where there is no financial profit for airlines safety would be compromised.
To him, a clear economic policy for the survival of domestic airlines is very critical at this time which has resulted over the years in the death of over 25 airlines in 30 years.
“Safety and Financial Economic Policy must go hand-in-hand; as airline investors are in the business of aviation for the profit and can’t make profit without safety or have a safe airline without profit.”
“This is the one of the main reason for the short life span of Nigeria airlines averaging about eight years, Meggison stressed, adding that: “Nigeria has the same four major catalysts in house that transformed Dubai from a desert into a hub in the Middle East today.”
Having carefully listened to the airline operators, the Acting President acknowledged the difficult situation the airlines face and promised to take a closer look into the various issues raised in order to find ways of addressing them, making it more friendly and promoting the ease of doing business in the airline industry as well as position Nigeria to take advantage of our natural God given geographical location as the hub in Africa.
In his summation, the AON Chairman noted that: “Aviation as an economic driver therefore, we believe Aviation should be supported as much as possible to thrive in order to reap its many benefits that can easily make aviation the 4th contributor to the economy and a major contributor to the GDP and to create 200,000 new jobs for our ailing youths through its direct and indirect link. Hence, rather than inflict greater burden on Aviation, things should be made easier.”
Google+