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The good, bad and ugly of air travel sector in 2017


Nnamdi Azikiwe International Airport, Abuja

Year 2017 in the aviation sector will perhaps go down as one with the most defining moments but with very little to show for real growth. WOLE OYEBADE in this review captures major events that shaped the year.

Without doubt, it was indeed a fairly good year for the aviation industry in Nigeria. It was quite defining for policies and what to do with infrastructural deficit. The regulators upped the ante on safety and economic audit with sanctions meted where appropriate. Operators, the cash-cow the industry, made marginal progress in terms of growth, with refleeting exercises spreading local wings on regional routes. The year also had voices of key stakeholders speaking louder on how to move the industry forward. Here is how they collectively impacted the sector in the last 12 months.

Another zero-accident year
Most critical for air travel is safety. So, come what may – flight delay or cancellation, shaky takeoff, turbulence, bird strike, aborted flight and so on – as long as there is no major incident, all is well that ends well. And for zero-plane crash in two years on a bounce, it is indeed a good year for the industry.

The sector operates an average of 170,000 flights a year, with over half of the flights made by local airlines. Limited infrastructure is a challenge at most of the 26 airports scattered nationwide. Except for a few, most of the airports have no airfield lighting and therefore closed for operations at sunset.

However, safety regulation led by the Nigerian Civil Aviation Authority (NCAA), appears to be more concerted with the by-in of airline operators that are all jostling for IATA Operational Safety Audit (IOSA) certification and membership of the International Air Transport Association (IATA). Collectively, they ensured another zero-accident year.

Besides, it is remarkable to note that the Accident Investigation Bureau (AIB) was unusually busy and active in 2017 despite no accident. AIB, under a new Chief Executive Officer, Akin Olateru, released 10 out of the 27 outstanding accident reports, with a total of 35 safety recommendations to make the future safer. Some of the outstanding reports are as old as 17 years!

Abuja airport closure
The Federal Government in March declared a no-fly zone over Abuja. The sole runway at the Nnamdi Azikiwe International Airport (NAIA) after years of neglect had become a disaster waiting to happen. The airport had to shut down for six-week repair during which the Federal Capital Territory and the Abuja environs were on lockdown. All the foreign carriers, except Ethiopian Airlines, shut Abuja operations while the runway repairs lasted.

Thankfully, Minister of State for Aviation, Hadi Sirika, and his team delivered a new runway within six weeks for the second busiest airport in the country to reopen.

Meanwhile, Kaduna airport turned out to be the beneficiary of the rather embarrassing Abuja airport closure episode. The airport, to cope with the traffic diversion from Abuja, got upgraded to international status with some of the latest air navigational equipment deployed. The facility has, however, remained grossly underutilised since Abuja airport reopened.

Arik’s takeover while others wax stronger
Asset Management Company of Nigeria (AMCON) in February took over Arik Air, sacking its management over alleged mismanagement and indebtedness to the tune of N300 billion. The then largest carrier in West Africa tumbled from 28 fleet-size to just nine operational aircraft.

The airline, under a receiver manager, has in the last 10 months restored credibility with operations restricted to local and regional routes.

While Arik struggled to stay afloat, other local carriers made steady progress to enhance their survival in a recessed economy and rather harsh business environment. For instance, Med-View Airlines took many by surprise by going public on the Nigerian Stock Exchange market. The airline, after a rocky period on the Lagos-London route, bounced back with the launch of Lagos-Dubai route, while Johannesburg and U.S. operations are in the offing.

Air Peace, currently the largest airline in the country, has expanded its fleet of 10 aircraft to 24, further consolidating on the local and regional routes. Dana Air successfully completing its IATA membership process and, in partnership with the Imo State government, now runs Imo Air. Aero Contractors, under AMCON, is not left behind as it also got certified to maintain aircraft at its Maintenance Repair and Overhaul (MRO) facility in Lagos.

Ease of doing business
Vice president, Yemi Osinbajo, in February paid an unscheduled visit to the Murtala Muhammed International Airport (MMIA), Lagos. It was a fact-finding mission for Osinbajo, who was the acting president at the time. The infrastructural deficit and poor maintenance regime were quite revealing.

Though the acting president gave a marching order that the nation’s busiest gateway be immediately put in shape, it was little surprise that the airports were put at the forefront of the Ease of Doing Business initiative of the Federal Government. With the initiative, foreigners can now access visa on arrival, passengers and luggage freely move around the airports without multiple checks by various security agencies.

Unfortunately, some immigration officers continue the ugly trend of extortion from travellers, demanding tips in the line of duty. It was no surprise that The Guide to Sleeping in Airports study for 2017, released in November, ranked Port-Harcourt International Airport (PHIA) as the worst airport in the world and MMIA among the top five worst worldwide.

Certification of MMIA, NAIA
Nevertheless, MMIA and the NAIA both passed the rigours of NCAA’s certification in the year under review. Both airports, under the management of the Federal Airports Authority of Nigeria (FAAN), were okayed to have met international standard and safe for operations.

MMIA, after the renovations that gave it a facelift, also got a new 1,300-lot ultramodern car park to “further enhance movement” at the airport. However, construction of new terminals at MMIA and NAIA, undertaken by Chinese Civil Engineering Construction Corporation (CCECC), still remain uncompleted in 2017.

Nigeria hosts ICAO forum
Global confidence in Nigeria’s aviation industry came to the fore in November when Nigeria hosted the International Civil Aviation Organisation’s (ICAO) World Aviation Forum in Abuja. The forum was the first to have been hosted outside of ICAO’s headquarters in Montreal, Canada.

The forum, in partnership with the African Development Bank (AfDB), reiterated the huge potential for air travel in Nigeria, if the policies and investments are right. It will be recalled that both ICAO and AfDB are headed by Nigerians – Dr. Olumuyiwa Aliu and Dr. Akinwunmi Adesina, in that order.

Airport concession plan
One of the issues that jolted the interest of all stakeholders the most in the year under review is the plan to concession all Federal-own airports nationwide. The exercise, beginning with the big four in Lagos, Abuja, Port Harcourt and Kano, is to turn around the infrastructure without government’s funds.

All stakeholders and groups endorsed the move, except aviation workers’ unions that, for the fear of job losses, claimed to be satisfied with the status quo. After much ado and expression of interests from foreign investors, the airports are still not concessioned till date.

Quite regrettable too is the yet unresolved faceoff between FAAN and Bi-Courtney Aviation Service Limited (BASL) over the concession of Murtala Muhammed Airport II (MMA2), the first of such initiatives in the aviation sector. The messy concession agreement remains is a bad advertisement for the government and its ability to honour agreements.

Multiple taxation
Another ugly trend that continued year round is the harsh business environment that makes it almost impossible for businesses to survive. While this is not unique to aviation, the air travel sector is a classic case of how not encourage investors in a sector.

There are no fewer than 36 sundry levies and charges in sector, allegedly taking about 65 per cent revenue of the airlines. With operators unable to balance the scale with other pressing obligations like fuel, maintenance and personnel wages, the local airlines are indebted to regulators to the tune of N20 billion.

Vice President, Yemi Osinbajo, at a parley with Airlines Operators of Nigeria (AON) in June promised to tackle multiple taxation in the sector. He has not kept the promise.

Nigeria Airways ex-workers still unpaid
The Federal government at September Federal Executive Council (FEC) meeting approved the sum of N45 billion to offset pension arrears and gratuities of defunct Nigerian Airways ex-workers. About 5000 workers, in their 60s and 70s, have been left in the lurch since 2004 when the national carrier was liquidated. Quite strangely too, they are still unpaid six months after Buhari’s approval.

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