Stakeholder Charts Path To Remedy Aviation Sector’s Woes

The effects of unremitted funds to foreign airlines would continue to lead to high airfares, according to the Chairman, Finchglow Holdings, Mr. Bankole Bernard.

The Federal Government, through the Central Bank of Nigeria (CBN), is withholding over $450 million in funds belonging to the carriers, a situation that has posed a serious problem to the operations of the carriers.

He equally lamented that the voluntary suspension of operations of Aero Contractors and the grounding of Dana Airlines operations would greatly affect capacity and bring more hardship to the troubled aviation industry.

He noted that the non-remittance of funds to foreign airlines would not only affect the cost of airfares, but the number of air travelers, cost of goods, and rate of inflation, calling on the government, through the Central Bank of Nigeria (CBN), to address the issue of the funds as it affects aviation and other industries.

He, however, stated that safety was important in the air transport business, but noted that the suspension’s impact will be felt. Speaking to Aviation Metric on the sidelines of an aviation 26th media summit at the weekend, he said: ”For me, on the issue of non-repatriation of funds by the foreign airlines, I think it is an issue that is over flogged.

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I don’t think at this particular point in time we should still be talking about things like this; we need to go back to the drawing board and address this thing the way we had addressed it in the past.

“Remember, five years ago, we had this kind of issue that even the funds got to an amount far higher than what it is now — about $750 million — and here we are talking about $450 million that has been stocked as a result of CBN not providing funds.

I think we need to give priority and I think with the sort of service that these foreign airlines have brought to us, I think CBN should have given them priority in being able to repatriate their money. ”I honestly don’t understand what is happening at CBN, but it really requires a lot of intervention, government needs to address the issue.”

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On the effect of the current trend, he said: ”It’s going to affect the cost of fare, the number of people that is going to travel, cost of goods, inflation is going to go up because if you look at the Nigeria of today, majority of the goods you find on ground are imported products and they are forex related and if they are forex related, it means the cost of those goods are going to go up and it’s going to affect the general masses, so I don’t understand why we can’t address this to be able to bring down inflation.

“If forex is in scarcity, the cost would go up, as at yesterday, the black market was already doing N600, I mean it is ridiculous, CBN needs to look into this because it would affect every industry, including the one we found ourselves, because this industry of today the spare parts, the training, the service, everything is dollar-denominated, so if it is dollar eliminated, the impact is going to be huge, so the government just need to intervene.”

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Nigerian airlines

On the temporary exit of two domestic airlines and their impact on the domestic industry, Bernard said, “it is quite unfortunate, but you know, in our industry, it is safety first. I want to believe that the regulator had to place safety over convenience, which I absolutely agree with them.

“If the airlines need to undergo audits to ensure that the lives of citizens are protected, I think it is worth it. Yes, it is going to create a sort of impact on either the number of inventory of tickets in the marketplace or aircraft to be used.”

Wole Shadare