Saturday 18 August 2012

Nigerian Aviation: Time to arrest this capital flight

By Alkasim Abdulkadir

Despite its chequered political history and food crisis Ethiopia is a sterling example of a functional aviation industry, the following recent achievements are the reason for this statement. One of its main businesses -Asky Airlines operates out of Lome-Tokoin airport and travels to 18 countries and has just made Togo its regional hub aside having its headquarters there. Ethiopia Airlines has also made history as the first airline to take delivery of a Boeing 787 Dreamliner and also the first non-Japanese carrier to receive the aircraft. The remarks of Tewolde Gebremariam are worth recounting here “The fact that we are the first airline outside Japan to receive this ultra modern aircraft is an affirmation of our continuing pioneering role in African aviation…”

The aforementioned is exactly what the MD of the defunct Nigerian airways would have said in the late 1970s and ‘80s Nigeria. Despite the extreme turbulence that has characterised the flight of the Nigerian aviation sector statistically it is still one of the most important markets in Africa, especially giving the high business, tourist, and pilgrimage mobility of Nigerians.

The NCAA says about 5 million people make up the passenger traffic at the Murtala Muhammed International Airport in Lagos; another 4 million pass through the Nnamdi Azikiwe International Airport, Abuja while an aggregate of over 7 million travel through all the airports in Lagos. No doubt any aviation investor, who ignores these numbers, will be losing out on a risky but highly viable enterprise.

There’s no need emphasising the loss to our national coffers capital to other countries annually on cost of routine (C – checks) maintenance carried out outside the country. This is due to the fact that we don’t currently have the capacity to conduct these C – checks locally. However, there are facilities for A and B checks. The funds expended by Nigerian pilots on gaining the requisite flying recertification and aircraft simulator training tests can be conserved if some these activities take place here. A classic example is an airline with 3 or 4 aircrafts will need to spend an estimated $450,000 on its pilots; as such some of these investment vistas include running of an aircraft maintenance hangar, establishment of ground handling companies and aviation training schools. Others are running a cabin simulator and flight simulator machines, importation of aircraft parts and navigational aids facilities.

One cannot rule out the multiplier effect of business activities that surround the airport from aviation fuel supply suppliers to haulage companies and catering services We need to understand that an airport goes beyond the operational components of the runway, helipad, control towers, hangars and terminal buildings; but also the components of base operators, seaplane docks and ramps, air traffic control, passenger facilities and other not only aesthetic but functional parts like restaurants, Telecom and bank outlets, lounges and emergency services.

Nigeria must begin to learn viable lessons from other global players take Air Berlin, Germany’s second largest airline, which has approached several airlines to find out whether they would be interested in becoming a strategic investor, amongst those contacted are Etihad Airways, Hainan Airlines and Emirates are understood to be among the companies that have been contacted. This is despite the fact that the company’s equity is currently €368 million and not considered an operating profit.

The federal ministry of Aviation and some of her agencies have embarked on the first phase of a long planned international investment road show this past weekend. The trip will take the team to China, the United States and Canada involving companies in finance and aerospace industries like CSCEC, ICBC, Hauwei, Boeing and Bombardier.

More than ever before there is an urgent need to attract diverse sources of funding for our aviation sector to grow; however it must be emphatically stated that there is an equally important obligation that the Ministry of Aviation must provide the enabling environment for these investments to flourish, the National Assembly must also carry out the legal frameworks that can provide the ambience for the investments platform to bear fruition. Like Harold Demuren of the NCAA said “what is therefore required at this time is abundant political will, adequate legislation and a review of the civil aviation policy to propose cogent guidelines for infrastructural development in all facets including funding”.

Alkasim Abdulkadir is an international freelance journalist and foreign correspondent for CCTV Africa.


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