Amid turbulence, a barrister steps into the cockpit: Any hope?
After a dismal eight years of Capt. Hadi Sirika, the local air transport sector is circling back into the arms of a barrister to try to steer it to safety. But beyond technical core competency either in aviation or jurisprudence, WOLE OYEBADE writes that the new minister will do no wrong placing national interest first.
For all the progress achieved by the erstwhile Aviation Minister, Hadi Sirika, the much more damage and chaos he leaves behind are telling and in higher decibel.
One of the fallouts of his failures is the demystification of expecting only aviators to turnaround fortunes of the air transport sector.
Since Nigeria’s independence, Sirika is not only the first aviator to serve as Aviation Minister, he is also the longest-serving minister at the helm of the uneasy sector. But for all the goodwill, he succeeded in parting with an industry that is more scandalised.
And when the current administration opted for a lawyer, Festus Keyamo, to head the unfamiliar terrain, only few aviators could muster a complaint of square peg in a round hole.
Generally, the public reception of President Bola Tinubu’s new cabinet is less than cheery nor one laced with high expectations. The coming of Keyamo to aviation is not any different. But therein abound an opportunity for Keyamo to lean on his legal experience and make an indelible mark in air transport – beginning with housecleaning of Sirika’s mess.
In that sense, the new minister has his work cut out on some quick fixes. Thankfully, he has pledged to continue with the Aviation Roadmap of his predecessor, instead of reinventing the wheels.
Therefore, he has firm decisions to make on the controversial national carrier project, skewed concession of major airports, stuck fund crisis and how best to relate with foreign airlines, and properly reform of the domestic operations to optimise the huge potential for win-win, among others.
Nigeria Air: To be or not to be?
Perhaps one of the biggest flops of the last administration is the fraudulent handling of the national carrier project. In its seventh year of conception, the supposedly noble project in partnership with Ethiopian Airlines (ET) among others, has landed in court with aggrieved local airlines operators in its way.
Operators, like Air Peace, United Nigeria, Azman, and Top Brass, claimed that the firm that served as Transaction Adviser for the transaction was incorporated in March, last year, and alleged that the company was linked to the aviation minister. The local airlines further alleged that the ATL issued to Nigerian Air did not pass through normal security clearance.
Inherent are interests that the new minister must balance but placing the national interest ahead of all. Should the national carrier remain a viable project, then Nigeria must float it well enough to last. Examples abound from the likes of Saudi Arabia and Nigeria should borrow a leaf and quit floating a new airline on borrowed wings of ET.
Concession of major airports amid controversies
In 2016, the Federal Executive Council (FEC) approved the concession of airports in the country, beginning with the big four in Lagos, Abuja, Port Harcourt, and Kano. Not until last year did Sirika announce the preferred and reserved bidders for the concession of three major airports – Lagos, Abuja and Kano.
The process has also not been spared of controversies. One of the bidders for the Murtala Muhammed International Airport (MMIA), Lagos, Sifax Group of Companies Limited, has filed a suit seeking disqualification of two preferred bidders – Tav Airports Holding Company and GMR Airport Limited.
Similarly, aviation workers’ unions have registered their displeasure against the Federal Government’s plan to concession four major international airports, coupled with the new agenda to demolish aviation agencies’ offices in Lagos.
The workers, under the aegis of National Union of Air Transport Employees (NUATE), Air Transport Services Senior Staff Association of Nigeria (ATSSSAN) and the Association of Nigeria Aviation Professionals (ANAP), said details of the concession plan have shown it as self-serving and anti-Nigeria.
Clearly, the minister must get all stakeholders to the roundtable and decide on how best to go with the concession, or what aspects of the aerodromes should be concessioned, and to whom.
Boards of agencies, and welfare
Indeed, one of the issues that agitated aviation workers the most in the last administration is the conspicuous absence of statutory governing boards of directors for five aviation agencies.
President Buhari had seven years ago approved replacements for the former boards but the new ones were not inaugurated by Sirika, apparently in preference for “a one-man” leadership at the helm.
Keyamo cannot afford to toe the path of such illegality. He must acknowledge that the responsibilities of the board – which include fixing the terms and conditions of service for employees, review of yearly reports of the management for submission to the President, presenting yearly budget estimates of the agency to the minister, record-keeping, and audit of the agency among others – are important to transparency and progress.
Former scribe of the National Union of Air Transport Employees (NUATE), Olayinka Abioye, noted that the establishing Acts of these agencies provide for the existence of these Boards, who see to the day-to-day running of the agencies in consonance with the Act establishing them.
Abioye said: “Without the existence of these Boards, the Minister becomes the alpha and omega, de facto and de jure controller of the agencies and that’s where we have found ourselves in these past eight years, where probity, accountability, and transparency had taken the back seat.
“It is very frustrating for CEOs to be running helter-skelter all over the ministry waiting to secure one approval or the other from the minister for days. I have witnessed occasions where the minister became the spokesman for the CEOs at several fora whereas the CEOs were present. Very humiliating, to say the least!” Abioye expects Keyamo to be different.
An equally high hurdle for the new administration is balancing the local interest with that of the foreign partners. Already, both the local and international segments of the air transport sector are in a dire straits.
Smarting from the stuck fund crisis, now in its second year, Nigeria, after Venezuela, tops the list of countries indebted to foreign airlines and sitting on funds from sales of air tickets in local currency.
According to the International Air Transport Association (IATA), since 2018, a significant amount of blocked funds had been repatriated from Angola, Ethiopia, Ghana, Nigeria, and Zimbabwe through working with the respective governments. Currently $1.5 billion in airline funds remain blocked across the African continent. Nigeria accounts for about $800 million of the funds.
Hence, foreign airlines are either leaving Nigeria or exploiting the ‘bad market’ by simply blocking lower inventories and selling at premium to further worsen the backlog. More daring European and American carriers started selling to dollar customers only. Put together, it means that economic airfares that are erstwhile sold in Nigeria and still the same in other less toxic markets for an average of $1000 are now sold in Nigeria at between $3000 to $4000 per seat.
Local airlines are not any better. With the forex crisis further pushing the cost of operations, repairs, and fuel higher, operators can barely breathe. Already, Azman Air and Max Air have stopped operations.
Findings by The Guardian showed that the eight active airlines are operating a cumulative 38.77 per cent fleet capacity, with a total of 60 out of 98 listed aeroplanes grounded, pending the availability of foreign exchange earnings to defray maintenance cost.
To save the day, the minister must first ensure that the country meets its obligations to our foreign partners (international airlines). Similarly, he must sit with the Nigeria Civil Aviation Authority, local operators, and other stakeholders on how best to support local operations with government policies only (not another prodigal intervention funds) to get better and stronger to fly on international corridors.
Enough of foreign airlines freely exploiting the viable Nigerian market without any competition from within. It is neither in the interest of the travelling public nor that of the local economy. The local sector must also get it right with local maintenance of aircraft, and possibly have better access to aviation fuel.
CEO of Topbrass Aviation, Capt. Roland Iyayi, earlier said that the sector could turnaround for better where the aviation policy is right to catalyse economic growth.
Iyayi, a former Managing Director of Nigerian Airspace Management Agency (NAMA), noted that Kenya and Ethiopia had similar challenges, but are least complaining because they have designed their policy framework for the development of their natural economy.
He said: “The policy we operate in our sector is not suitable for the development needs of the country. You don’t set up aviation because you can, but to catalyse the growth of the country. All our airlines are operating into a finite market; and that is the same thing we have been saying in the last 10 years. There is a need to address the policy to support growth of other aspects of the economy – tourism, extractive industry and so on.”
Iyayi, however, offered a grim warning. “I see more airlines failing in the short-term, simply because there is no capacity and airlines are not getting adequate financial muscle to meet obligations. So, airlines will fail. It is probably going to get worse before it gets better. It is a shame, just because the foundation is not right,” Iyayi said.
But will Keyamo allow the sector to further dip under his watch, or get it looking up again? Only time will tell.
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