Business

Poor Policies, Hostile Environment Bane of Indigenous Carriers

Poor regulatory policies and a hostile operating environment have been identified as the major challenges facing Nigeria’s air transport sector, which has been described as lopsided in favour of international operators.
 
Airline operators who spoke to THISDAY complain that there is no clear policy on how government can support the airlines, as obtained in other parts of the world, since air transportation is a huge vehicle to economic development of any nation.
 
Consequently, indigenous carriers have been operating without growth and profitability due mainly to the poor policies, lack of support, high fuel prices and high charges.
 
The President of the National Association of Aircraft Pilot and Engineers (NAAPE), Isaac Balami said: “Generally there is no airline that can survive in the world without government input. Name all the leading airlines from the UK, America, Middle East and others, they all need the support of the host government in one way or the other. Nigeria is the only country in the world without consistent programme on how to support its airlines.”
 
The Managing Director and Chief Executive Officer of MedView Airline, Alhaji Muneer Bankole says that high fuel cost “eats up the revenue of airlines, taking over 40 per cent of operational cost of putting aircraft in the air.”
 
He said that as oil producing country, Nigerian airlines should not be paying for fuel at the present high price of N170 per litre, adding that government should support the airlines by reviewing downward the price of aviation fuel, Jet A1.
 
Bankole said that about 2812. 5 litres of fuel is consumed by a Boeing 737 aircraft for a 50 minutes flight from Lagos to Abuja. This, when multiplied by N170.00 per litre, will cost an airline with that aircraft type about N478, 125 for that 50 minutes flight.
 
He said government should invite oil marketers to the table to see how they could reach a compromise on how to bring down the cost of aviation fuel, remarking that the marketers also have their own challenges.
 
The airlines have also complained about high charges by aviation agencies, including the five per cent tax on ticket by the Nigerian Civil Aviation Authority (NCAA), which it shares with two other agencies; the charges paid to the Federal Airports Authority of Nigeria and that of the Nigerian Airspace Management Agency (NAMA).
 
Bankole said that these charges stifle the growth of indigenous airlines and this explained why no domestic airline exists for a long time and also why Nigerian operators have limited capacity, lamenting that a country of over 170 million has barely six operating airlines, many of them with few aircraft in their fleet.
 
“The challenge in running an airline in Nigeria is enormous. It is just the matter of doing something for a long time that made us go into the business,” Bankole said.
He however gave kudos to the Federal Government for the waiver of Customs duty on importation of commercial aircraft and parts, noting that the Nigerian Customs Service is cooperating to make the waiver work.

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