Aviation industry stakeholders have said that the inability of the federal government to honour agreements was the major reason why international financiers, lessors and investors failed to support the planned national carrier, Nigeria Air.
The industry players said despite the claims by government top officials that some institutions were interested in the airline, there were indications that the quest for international investors did not receive positive response because the Nigerian government is known in international aviation circles for not honouring agreements.
The stakeholders also noted that the planned national carrier destabilised existing airlines, as their international partners, fearing a national carrier would take over the market, were reluctant to continue to do business with them.
They spoke at the Aviation Round Table (ART) Quarterly Business Breakfast Meeting in Lagos yesterday and x-rayed the problems of air transport industry in Nigeria.
Director of Studies, Centre for International Advanced and Professional Studies, Prof. Anthony Kila, accused the Minister of State, Aviation, Hadi Sirika of conceiving the Nigeria Air project in secrecy, which led to its collapse.
“The death of the airline was planned by its promoters. Air Nigeria product was conceived on power point, shared on Adobe and died on twitter,” he said.
ART President, Gbenga Olowo who spoke on the theme of the meeting, “Short Lifespan of Nigerian Airlines: The Importance of Corporate Governance,” observed that the average lifespan of Nigerian airline was between five to 10 years.
Olowo insisted that if the corporate governance for the airline was right, some of them would still remain in business, but emphasised single ownership syndrome was affecting their growth.
Olowo said that while the International Air Transport Association (IATA) on its 2017 analysis of the industry observed that the airline sub-sector made profit for the third consecutive years, airlines on the continent had continued to go down and consistently operate at a loss.
He attributed the weak performance among African airlines to regional conflict, high level of taxes and lack of corporate governance.
Olowo however, said the conception of Nigeria Air by the government caused so much havoc to the industry.
“The announcement of Nigeria Air in the last three years by President Muhammadu Buhari administration shook the industry because it was a vote of no confidence on the existing airlines, but after three years, the project was suspended, which has since led to speculation.
Former Managing Director of Virgin Nigeria Airways (VNA), Captain Dapo Olumide lamented the inability of government to honour agreements in the aviation industry and recalled that when VNA was established it was agreed between the federal government and major investor in the Nigerian airline, Richard Branson, that the airline would operate both its services from the international terminal of the Murtala Muhammed Airport, Lagos.
Olumide noted that this agreement was repudiated by the government and frustrated the airline from building operational hub in Nigeria to bring in passengers from all over the world and distribute them to other West African destinations through the Lagos airport.
Reacting to the description of Nigerian airlines as weak, the Chief Executive Officer (CEO) of Overland Airways, Capt. Edward Boyo, attributed the failure of airlines in the country to unfavourable operating environment for the airlines.
Boyo insisted that not only good corporate governance could make an airline successful, stressing that the issue of Virgin Nigeria despite its seemingly good corporate governance was planned to fail.
Boyo accused the players in the sector, government and aviation agencies of hostility towards the airlines, stressing that no airline anywhere in the world could operate successfully in Nigeria under the current condition.
“The agencies and stakeholders are so hostile to the airlines; they talk them down at every given opportunity. Nigerian airlines need the right atmosphere and environment to operate profitably. But, at every opportunity we have, rather than encourage the airlines, we talk them down without respect.
“Airlines are not set out to delay passengers, but the environment is hostile to our operations. Nigerians want cheap flights and top service. We can’t have the best service until an hour flight is about $200. Age of aircraft does not matter inasmuch the aircraft is airworthy,” Boyo said.
