The expected growth of the air transport sector in Nigeria for many decades has been arguably stalled by unfriendly policies, rigid regulations and poor management decisions by airline owners/managers and others holding the ace in the strategic sector. Experts, operators and industry players met at at a conference last week in Lagos to fashion ways to return the sector to profitability.
Efforts to return the global air transport sector to profitability will not deliver the expected result until governments, airport authorities and aeronautical authorities embrace the needed policy, friendly oversight regimes as well as the best management practices, experts have said.
The experts, including airline owners/managers, lawmakers and chief executives of aviation agencies, gave these prescriptions at the end of a one day conference in Lagos organised by the League of Airports and Aviation Correspondents (LAAC) with the theme: “Nigeria’s aviation industry: Management, policy and regulation.”
Minister of Aviation, Captain Hadi Sirika, who was represented by Commissioner, Accident Investigation Bureau (AIB), Mr. Akin Olateru, said the ministry, in conjunction with the agencies, were working with the National Assembly to review/amend the agencies’ Acts to provide effective management and align with modern technological development in line with international best practices and development in the International Civil Aviation (ICA).
The two legislative houses have held public hearings on the matter and are at the stage of finalisation of their Report. The review includes the Nigerian Civil Aviation Authority Act (NCAA) 2006; Federal Airport Authority of Nigeria Act 2010; Nigeria Airspace Management Agency Act 1999; Nigerian College of Aviation Technology Act, 1964; Nigerian Meteorological Act, 2003; and Nigerian Safety Investigation Bureau Act, 2019.
He stated that to do that successfully, the agencies and other support services would need financial relief from the Federal Government.
His words: “Without financial relief, I do not see a quick recovery. We need aggressive policy and we need to do much more on implementation that is very aggressive. As you are aware COVID-19 has put the global economy to the test, with air transport being undoubtedly the hardest hit by the pandemic.”
This is coming as statistics from the International Airline Transport Association (IATA) on COVID-19’s economic impact on Nigeria has shown a revenue loss of $994 million last year.
In terms of employment at risk in Nigeria, it is 125,370 and loss of contribution to the Gross Domestic Product (GDP) is $885 million.
The Federal Government was able to cushion the effect of COVID-19 by providing intervention funds of N5 billion domestic airlines; funds considered paltry to save airlines from their precarious situation.
Chairman of Air Peace, Mr. Allen Onyema, lamented the devastating effects of COVID-19 on airlines and the industry, stating that Nigeria was not immuned from the pandemic.
“A lot has been said about airlines in Nigeria. Lack of good regulations and policies have been blamed for the myriad of problems confronting the sector. Things are evolving. We hope it will be better. Why are airlines failing? Could it be from the airlines themselves and other factors? he asked.
Onyema said many people have blamed airlines collapse because of faulty structures of airlines occasioned by decisions that are injurious to the carriers without knowing it.
“Government‘s policies in the recent past had been better compared to what we had in the past. The government has done well in the area of policy such as customs duty waiver on aircraft spare parts and VAT and others that are favourable to the airlines.
“Recent government policies are better compared to what we had in the past. The government has done well in ensuring policies such as customs duty waiver on aircraft spare parts and VAT. The AON presented the issue of the partial implementation of the Finance Act 2020 which prohibits the payment of duties and VAT on imported aircraft and aircraft spares by the Customs Service to the National Assembly. There was also the presence of a seven per cent surcharge on the assessed duties which was not supposed to be. This caused delays in the clearance of aircraft and aircraft spares leading to grounding of aircraft that would have been flying.
“With the help of the Minister of Aviation, the airlines contacted the Minister of Finance on the challenges and both ministers swung into action. We commend the Federal Government for its unflinching support for the growth of indigenous investments in Nigeria. This was very evident in the manner the government got this challenge addressed immediately within 48hours to the joy of the airlines,” Onyema said.
The Managing Director, Federal Airports Authority of Nigeria (FAAN), Capt. Rabiu Yadudu, also complained of the financial distress the industry was still facing. He said it would take at least 24 months for the industry to recover from the effect of the pandemic.
He said without sufficient financial resources, it would be difficult for the industry to recover. He called for the implementation of policies, saying while the industry was performing well in terms of regulation, implementation has remained a major challenge.
Chairman, Senate Committee on Aviation, Smart Adeyemi and Chairman, House Committee on Aviation, Nnolim Nnaji, who were present at the conference, assured stakeholders that the Nigeria Civil Aviation Regulation (NCAR) Bill before the National Assembly would soon be passed.
Adeyemi said the passage of the Executive Bill would further accelerate growth in the industry. He promised he would do all within his capacity to move the sector forward. “As soon as we resume from our recess, efforts will be made to ensure that we pass the NCAR bill before us. Aviation is the socio-economic status of any nation. It requires the support of everyone,” Adeyemi said.
Nnaji said the industry requires good policies and the right framework to move it forward. He assured that the House of Representatives would accelerate the passage of the bill before it.
Director-General, NCAA, Captain Musa Nuhu, said the job of the agency is to oversee and regulate the airlines, but that it is the duty of the ministry to come up with policies which the regulatory agency implements.
He however assured that the agency was working to ensure that stakeholders, including the airlines would smile when its plans had been completed.
He said the NCAA was repositioning towards the effectiveness and efficiency of its statutory function of its safety oversight.
Capt. Nuhu listed some actions taken by the NCAA to include reducing the Authority’s directorate from eight to six for a more responsive and flexible functionality, automation of internal processes through the implementation change management and acquisition of appropriate ICT systems which was ongoing.
He however said that the Authority like any organisation has its own challenges and difficulties which is attracting and retaining adequate numbers of technical personnel critical for effective oversight of the industry. He promised that the CAA would continue to partner all stakeholders, especially the media, for the attainment of industry potentials for the benefit of people and country.
don’t shy away when the customers complain or give us feedback.
“So, when they give us feedback, we love them, and we draw up plans on how those issues can be resolved. We take everything onboard; the good, the bad. As we move on, we intend to increase our services to our customers. Don’t forget that we are in this business because of our clients. It is very important to showcase them and let them know we care for them.”
On the complaints raised by the clients, Fagbemi explained that some of the challenges were not in the purview of NAHCO but assured that the management would pass such messages to the appropriate authorities.
She expressed the hope that the current year would experience a new turnaround for the industry, stressing that NAHCO has a quarterly investment plan in acquisition of Ground Service Equipment (GSE), which it had been following in recent times.
Also, Prince Saheed Lasisi, Group Executive Director, Commercial and Business Development, NAHCO, said that in a bid to get appropriate feedback from the clients, the Company has created a new desk, ‘Customer Experience,’ which has helped it to improve its services to its clients.
“Based on the survey that we carried out, we discovered our challenges especially in the areas of staff shortage, equipment and others. It is the desk that has helped us to identify the challenges and we now know how to solve them.”
On his part, Mr. Kelechi Amaechi, the Head, Customer Experience, NAHCO, said the company was already improving on its relationship with its clients, irrespective of class and status.
Organisations like Emirates, Qatar Airways, Asky Rwandair, Air France/KLM, Ethiopian Airlines, freight forwarders and others were represented at the dinner.
Many of the clients in attendance lauded NAHCO for its consistency in delivery quality services despite the challenges of forex, Covid-19 pandemic, and others, with an affirmation of continuous patronage.
