Minister of Aviation and Aerospace Development, Festus Keyamo, has disclosed that 95 per cent of the newly established Nigerian Aircraft Leasing Company will be funded by private investors and development finance institutions across Africa and beyond.

Speaking during a meeting with representatives of the Airline Operators of Nigeria (AON) yesterday in Abuja, Keyamo said development finance institutions, including private investors, were already showing interest in providing the needed finance for the aviation leasing company.

According to him, the Special Purpose Vehicle (SPV), recently approved by President Bola Tinubu and the Federal Executive Council (FEC), would operate as a substantially private sector-driven company, while the President has mandated four ministers — Finance, Aviation, Industry, Trade and Investment, as well as the Attorney-General of the Federation — to ensure its smooth take-off.

He said the government’s role would be limited to providing strategic support and sovereign guarantees for aircraft safety and repossession, while the bulk of the financing would come from investors and financial institutions.

“The company will be substantially private. We are bringing in investments of nearly 95 to 99 per cent from outside government through development banks, private investors from within and outside the country,” he said.

The minister explained that the initiative was designed to ease the persistent challenge local airlines face in accessing aircraft and affordable financing.

He said the SPV would acquire aircraft through dry lease arrangements and lease them to Nigerian operators in naira, thereby reducing pressure on foreign exchange demand and shielding airlines from exchange rate volatility.

Keyamo noted that the structure would also simplify transactions for international financiers, who would interface with a single Nigerian entity instead of multiple local airlines.

He added that government backing would guarantee smooth repossession processes for lessors and financiers in the event of default, a move expected to boost investor confidence in Nigeria’s aviation market.

According to the minister, Nigeria has been selected as one of the pilot countries for the programme, which has a funding package of about $7 billion dedicated to aviation development across Africa.

Keyamo also disclosed that he had been appointed ambassador by the AfDB for the programme across the continent.

He said discussions with investors and financial institutions were already ongoing, while the incorporation process for the SPV was expected to be completed within weeks.

The Managing Director of Ibom Air, George Uresi, commended the Federal Government for the initiative, describing it as a major intervention that could lower financing costs, improve airline operations and reduce the frequency of flight delays and cancellations in the country.

He said the minister had addressed three major challenges that had plagued the industry for years, highlighting the major strides to include the Cape Town Convention, aircraft insurance and now access to aircraft financing in Naira and at a reduced interest rate.