With about 10 months to the end of President Muhammadu Buhari’s administration, the proposed national carrier, Nigeria Air, is still a mirage as stakeholders question its operational model and profitability.
So far, the planned national carrier has obtained an Air Transport Licence, which is a forerunner to an Air Operator Certificate.
But many in the aviation industry are still bewildered that an administration that has two tenures of four years each, is still struggling to actualise a national carrier project at the twilight of its second tenure.
The long-term gestation has bred cynics who doubt the sincerity of the project and many of them hope they would be proved wrong at the end of the day.
Being wrong means a new carrier would be born, new jobs created and more capacity added to the existing aircraft fleet in Nigeria. But as the cynics struggle about their reservations, doubts still lurk in the dark corners against hope, considering the cloudy process, as people yearn to have a glimpse of what stage of the project the government is in.
Media Adviser to the Minister of Aviation, James Odaudu, reportedly said that the team driving the project had secured approval for the lease of the aircraft for the new airline and the next stage would be to obtain AOC from the Nigerian Civil Aviation Authority.
The aviation sector is presently at a crossroads over the operational method, profitability and jobs at the proposed Nigeria Air as rolled out by the Federal Ministry of Aviation.
Apart from starting the airline with leased aircraft, stakeholders are also worried about the incessant change in takeoff dates.
According to stakeholders, the wet lease model would mean taking both the foreign aircraft along with the foreign crew that would be paid salaries and allowances in foreign currency.
Also the maintenance and other services would be done by the owners of the aircraft offshore, thereby, being at loss to Nigeria.
In terms of employment, the project is starting off on the wrong foot. It has been reported that the three aircraft will be wet-leased which means that the crew will not be Nigerian. For a national carrier that was positioned as a generator of employment for Nigerians, this will be a kick in the teeth.
Likewise, the incessant postponement has been a source of worry to stakeholders who argued that a national carrier without a startup date 10 months to the expiration of the present administration means the project is a white elephant project.
With the numerous funds it has drawn from the national budget, there are fears that starting up the national carrier at this challenging time in the sector may be ill-advised.
Although the market exists and airlines are operating in this market, they have challenges with the price of fuel and foreign exchange to pay suppliers, so it is obvious that the proposed airline can hardly survive with wet lease aircraft
With the foreign airlines facing the challenge of selling tickets and hundreds of millions of dollars that cannot be repatriated, how will the proposed three planes for Nigeria Air operate on the basis of the wet lease?
“Although the government might use its might to start flight operations against the odds, it is certain that the airline will not survive because the circumstances are not right”
How does that solve the problem of Nigeria as a nation in terms of creating employment as an industry? How does that solve the problem of foreign exchange that the country is already facing because it has to pay for that wet lease in foreign exchange?
How does that solve the problem of availability of funds through the Central Bank of Nigeria or will the national carrier get its money through the black market to fund its operation?
Where will the structures for sustainable Nigeria Air be laid upon? Where are the offices of Nigeria Air? Where is and who are members of the management team?
This team should have been presented to the NCAA by now; at least during the Pre-application Statement of Intent meetings. Who are the investors? How much is their equity investment? How much is the Federal Government’s five percent? Where are the aircraft? What about the jobs for Nigerians?
Although the government might use its might to start flight operations against the odds, it is certain that the airline will not survive because the circumstances are not right.
The proposed national carrier is fundamentally an absurd proposal made to a group of people that have no knowledge of what is going on in the global aviation industry.
Aviation analysts are of the view that the Federal Government needed not to invest any amount of money in the impending national carrier project.
Their contention is that the government should take a cue from global trends, which seem to negate state-owned carriers.
According to the experts, most governments had divested their interests in their hitherto national carriers.
The current Nigeria national carrier journey has had a lot of missteps already, which begs the fact that the Federal Government should learn from experience and global trends in this quest and let the airline industry be private-sector driven.
Most countries that used to have government-funded carriers have either divested completely or have minority stakes where the carriers still exist. This is to ensure that beyond risk mitigation, other drivers for privatisation are allowing the airline’s executive management to make financial and operational decisions free from political pressure or meddling.
It is our point that the Federal Government should provide the national policy directions, and strong foreign economic policy for aviation, particularly Bilateral Aviation Agreement administration, address the multiple destinations and codeshare agreements with foreign airlines, develop the political will, and create an enabling environment for aviation businesses to thrive.
The Federal Government should also build up the courage and ensure total deregulation of the airline industry, just as it happened in the telecommunication industry about two decades ago because a strong and independent aviation regulator would also move the entire industry forward.
