Many lessons unlearned on national air carrier
There is an older generation of Nigerians who are keen to regale the young ones with stories about the country’s good old glorious days. They will talk so glowingly with nostalgia about how orderly things were back in their days; the universities churned out graduates who went on straight to pick up jobs, with official cars to complete the package. The elderly citizens will move on to talk about the national currency, and how its value was even more than the now almighty United States Dollar! Then, they will narrate with even more enthusiasm about the brand that was Nigeria Airways, its efficient service, and the pride they felt as citizens whenever they flew the then thriving national carrier. Nigeria Airways was about the most tangible national heritage, which spectacularly collapsed and disappeared. On the radar of national consciousness, Nigeria Airways is one of those defunct national assets, which now presents a faint memory of what could have been, just as it has left behind pathetic tales of losses and disappointment.
In the face of these memories, the fundamental question raised by the younger generation is; what happened to everything? How did these monument belonging to the country go into oblivion? Ironically, as these questions are asked about the past, young people can see even more damaging choices and decisions, which make the reversals of the past seem like child’s play. According to an entry on Nigeria Airways published by Wikipedia, by May 2003, the year Nigeria Airways finally packed up and closed shop, it only owned a Boeing 737-200 as its sole serviceable aircraft. The government of President Olusegun Obasanjo had decided not to pump more money into what was considered an overstaffed carrier but to liquidate it. The decision according to the online source was based on the declining performance of the airline’s last 15 years of operations and on the carrier’s debts.
It is on record that the airline’s number of carried passengers had fallen from 2.1 million in 1985 to just 10,000 in the first quarter of 2003, and it was reported to control just six and one per cent of the domestic and the international markets. The more galling reality is that the once promising carrier was mired in serious indebtedness. The carrier was reported to owe over US$528 million, despite government’s injection of US$200 million into the company in its last decade of operations. The sordid and very pathetic end of Nigeria Airways did not provide any lessons for the Nigerian government.
Less than a year after the liquidation of Nigeria Airways, the government of Obasanjo again whimsically started committing the nation’s resources to floating a new national carrier. Using the smokescreen of public private partnership, the imperial Presidency of Chief Olusegun Obasanjo took hasty steps to decree and strike a partnership with Richard Branson’s Virgin Atlantic.
On September 28, 2004 the government and Virgin Group signed an agreement to set up a new airline for Nigeria, to be called Virgin Nigeria Airways. The agreement stipulated that Nigerian institutional investors would own 51 percent of the company and Virgin Atlantic would control the 49 percent remaining. The airline’s inaugural flight was on 28 June 2005 from Lagos to London Heathrow. It was clear right from the start that the partnership was built on quick sand, and it did not take time before things fell apart. As narrated by Wikipedia on 19 August 2008, Virgin Atlantic announced that it was in talks to sell its 49 per cent stake and reviewing whether it was appropriate that the Virgin brand should remain linked to Virgin Nigeria. “This followed a dispute which arose after Virgin Nigeria’s domestic operations were moved against its will by the Ministry of Transportation to Terminal 2. Virgin Nigeria had twice refused the directive to relocate its domestic operations from the international terminal, citing the Memorandum of Mutual Understanding it had signed with the Obasanjo administration, and pending appeal in a Lagos High court, as reasons for not complying.”
The lesson, which should have been learnt is that while one administration may excitedly jump into a venture, there is no guarantee that a subsequent administration would enthusiastically embrace same. The bitter experience from the Virgin Nigeria debacle would be found in the fact that by 2009, the equity partner pulled the plugs. Gradually, operations tottered to a halt with job losses and the reality of investors licking their wounds. The wounds were inflicted by the fact that they ventured into a volatile environment in which the rule of law, is only observed in breach, and where might is always right.
However, the Virgin Nigeria fiasco also did not mean Nigerian politicians had learnt their lessons. As soon as the Buhari Presidency came on board in 2015, the politicians began to make the floating of a national carrier a priority. By 2018, Buhari’s men found their voice and began to make actual plans for the launch of a new national carrier. The move, as it was in the past was neither steeped in any proper study or driven by organic or wide ranging consultation with stakeholders. The surreptitious manner the plans for the airline was hatched made it apparent that the motivations were not altruistic. The result was that the idea was resoundingly rejected by the public as yet another fanciful white elephant. Many peeved Nigerians rightly wondered why floating a national carrier was deemed a higher priority than arresting the collapse in education, fixing the fast crumbling infrastructure across the country, and revamping the decrepit health facilities.
Consequently, the pressure from the public led to suspension of plans for the launch of the airline. However, as developments of the last few days indicate, government officials did not entirely shelve the idea. They were merely waiting for a time to sneak it back into the agenda, especially at a time when they believe the public will be less hostile to the idea. As such, the Federal Ministry of Aviation through the minister recently told federal legislators that plans to float the national carrier were already afoot with around N78 billion already put aside for it in the 2021 budget. Again, like the previous approaches, which ended in colossal failures, the current rabid move to begin what will likely not be a sustainable venture, is shrouded in opaqueness and lack of transparency.
Nigerians in whose name the airline is supposedly being established have not had any chance whatsoever to say if they need an airline or not. Also untoward is the haste with which the government officials want to ram through their intentions without any pretence about their readiness to allow for a rigorous conversation on the project to enable citizens say whether they want it or not.
Worse still, the rush to float the national carrier is coming at a time the COVID-19 pandemic has crushed the profitability and vibrancy of the global airline industry. In an era of globalisation, Nigeria’s government officials cannot argue by any stretch of the imagination that the restrictions and the travel crunch precipitated by the COVID-19 pandemic will not affect its business model.
According to Statistica.com, the estimated revenue loss for airlines worldwide in 2020 due to COVID-19 stands at USD314billion. The online data platform further reveals that for the week starting October 26, 2020, the number of scheduled flights worldwide was down by 45.8 percent compared to the week of October 28, 2019.
Unfortunately, this is the uncertain and extremely volatile terrain Nigerian government officials are insisting on plunging the country into with the jaded idea of a national carrier. Apparently, the officials in the Ministry of Aviation and their principal do not give a damn about pushing public funds into a venture, which would likely result in huge losses for the country. It is a recipe for failure that a country, which is yet to muster the discipline to consistently implement policies to make the business environment conducive for investors, is dabbling into the complex area of running an airline at a very uncertain time for the aviation sector globally.
It is apparent that more Nigerians need to ramp up the pressure to ensure the profligate use of public funds for an unclear and uncertain airline venture, is halted. Since government has refused to learn from the costly missteps from the past, the onus is on citizens to ensure those lessons are learnt. That is the only way to halt the huge allocation for a so-called national carrier in 2021 budget. From all indications, the venture may end up as another round of wasted resources.
Edgware wrote from Warri, Delta State.
No comments yet