Foreign Airlines’ Multiple Designation Policy Under Scrutiny

How easy is it reviewing policies that have hindered the growth of Nigerian carriers? Time will tell if plans by the National Assembly to review multiple designations to foreign airlines won’t go the way of others, writes, WOLE SHADARE

Strong battle ahead

Aviation is not a stand-alone in any country. Aviation is a reflection of the policies and the financial health of any country. So, when aviation is taken and the country is not doing well, there is need to find out if the policies are supporting its growth.

This appeared to have been regarded as lost battle. The battle to cut down multiple destinations for foreign carriers to Nigeria may have begun. It remains to be seen how this can be done as the foreign airlines are daily spreading their wings to many airports across the country.

The announcement last week by the Chairman, House of Representative Committee on Aviation, Nnolim Nnaji, that the National Assembly would begin a review on the issue may have gladdened the hearts of Nigerian airline operators, who see the policy, which started in the 2000s and may have become a ‘new normal’ for any airline operating to the country.

Undermining local carriers

Nnaji in responding to the complaints by airlines and participants at second day of the public hearing on amendment bills on Civil Aviation Acts regarding the policies of government that tend to undermine the survival of indigenous airline operators agreed that such arrangement was detrimental to the growth of the industry.

He stated that the committee had taken note of the challenges such policy was posing to the local airlines and would see how the new laws could address the matter.

It was the opinion of the participants that all foreign airlines operating into the country should be given approval to operate to only one destination in Nigeria and any point beyond should be through code share with an indigenous operators.

Nnaji had earlier even before the inauguration of the committee voiced his opposition to this same policy.

Stifling aviation growth

Policies of government had over the years stifled the growth of aviation locally.

They have been put in the ring to box with champions or with the giants with their hands tied behind. Not just even putting them against giants like David against Goliath, they are not afraid to fight with the Goliaths of the industry, but their hands need to be untied to even have a modicum of strength to fight back.

Many bilateral treaties have been entered without carrying the aviation community along. Virgin Atlantic is the only airline operating to only one destination in Nigeria from London. British Airways enjoys frequencies to Nigeria with landings in Lagos and Abuja.

Emirates operates to Lagos and Abuja. Qatar recently was granted permission to operate to Abuja aside Abuja that it flies to. Ethiopian Airlines is now regarded more as Nigeria’s ‘domestic airline’ because of favour it enjoys from the Nigerian government. It flies to Lagos, Abuja and may resume flights to Enugu when the airport is opened to international air travel December this year.

Lufthansa, KLM and Air France operate to Port-Harcourt, Lagos and Abuja as plans have already been concluded to open Kano to willing airlines by way of taking air travel to those living in that area.

While Nigeria is busy opening up its airports to various foreign airlines, their counterparts elsewhere were restricting Nigerian carriers from flying into airports of their choice.

Losing domestic market

The BASA agreements gave many of the foreign airlines multi-designations that enabled them to operate from different airports in the country at the expense of domestic carriers, which lose passengers to them. It is this undue advantage that gave the foreign carriers 90 per cent of the Nigerian air traffic market, while Nigerian airlines only have five per cent of the market.

The multiple designation policy is heavily skewed against Nigerian operators. They have no participation in all of this. When there are multiple designations in one country, it means they can fly into Abuja, Kano, Abuja, Kaduna, Port-Harcourt, and Enugu. The implication is that they are taking over the domestic market.

It highlights the country’s airlines’ lack of participation because it lacks airlines that can reciprocate that and that automatically become one-sided which brings greater disadvantage to them. The indigenous carriers panic because they are not flying internationally. They are only flying domestically. They have already lost out in the people they carry from Abuja, Kano, Port-Harcourt, Kano, Enugu because the foreign airlines go there to pick them out of the country.

A case for multiple designations

Many have also argued that it becomes economically suicidal to shut the door to air travel to people living outside Lagos and Abuja simply because of the interest of the local airlines. They equally argued that Nigeria is a federation where virtually every place has to b served by air with huge investment in airports. The people from Enugu for instance don’t want to come to Lagos to fly out; they want to be able to fly out from their place. It reduces costs for them.

Experts’ views

Former Director-General of Nigerian Civil Aviation Authority (NCAA), Dr. Harold Demuren described the multiple designations as ‘good policy, bad economics.’
He urged domestic airlines to cooperate with the airlines so that the situation does not look irredeemable.

His words: “Now, in the whole world, it is about cooperation. How can you compete with Emirates? It is not possible but you can cooperate with them. You need not see them as competitors; you can do a lot of things with them|.

“Are we going to take the routes away from them? I don’t think it will be possible. I think the only place being protected a bit is Port-Harcourt. But don’t forget, Nigeria is Lagos, Abuja and Port-Harcourt that are the golden triangle. Lagos is  gone 100 per cent. What made Lagos a hub is we built a hub but we have not made Lagos a hub yet.

“Are you aware that most of the passengers that fly with Ethiopian Airlines are Nigerians? Do you know the amount of cash, tax, revenue they make from Nigerians buying their tickets? So, we have opportunities.”

An aviation security expert, Group Capt. John Ojikutu (retd.), noted that reviewing BASA might involve a lot of diplomatic technicalities and languages.

He, however, stated that reviewing all the commercial agreements with foreign airlines especially those that were given multiple frequencies, landings and destinations outside BASAs was within the competence of the power of the ministry and the minister.

Ojikutu said: “To retain and sustain the domestic routes and the markets for the Nigeria private airline commercial operators, there is a very urgent need to review those commercial agreements that have given multiple landings and destinations in this country to foreign airlines.

“You should consider therefore restricting the foreign airlines landings to either Abuja or Lagos and to any other airport in the alternative geographical zone to their first choice of Lagos or Abuja for each airline within its operating BASA.”

Last line

For some time, many industry experts have been calling for a radical review of the BASA and by extension multiple designations. The call gained momentum recently, when industry stakeholders who attended a forum in Lagos, insisted that Nigeria and its airlines are short-changed by the agreements.

Wole Shadare