Africa: Experts Express Doubt National Carrier Could Come on Stream By 2019
Aviation industry experts have expressed doubt that the President Muhammadu Buhari-led administration would be able to realise the establishment of the national carrier projects before it winds down in May, 2019.
But many have expressed full support for the project, noting that it would reposition the aviation sector if realised.
Minister of State, Aviation, Senator Hadi Sirika Thursday unveiled Transaction Advisers for the establishment of a national carrier along with that of maintenance facility, concession of four major airports in the country and others and said Airline Management Group Limited was selected for the rebirth of a national carrier.
But experts who spoke to THISDAY doubt the successful establishment of the national airline within the stipulated time of barely one year, noting that for the transaction to be transparent and for it to be private sector driven, as government has emphasised, more time is needed for such an airline to be “sincerely and transparently established.”
Travel experts and the organiser of Akwaaba African Travel Market, Ikechi Uko said time would be a strong factor in government realising its objective in establishing a national carrier.
He wondered why nothing much was achieved in almost three years and now that government is winding down it is unveiling a transaction adviser.
Uko, who is in full support of a national carrier because it would mark a turnaround in Nigeria’s air transport sector, create jobs and enable Nigerians benefit from its huge passenger traffic, said it might not be easy for government to actualise its objective within the time frame.
“I don’t know what government’s checklists are but if in three years government could not advance the establishment of a national carrier, what is it going to do in less than a year? I believe that time would be the government’s greatest challenge. I know money has been expended in the project but it will need time to realise the set goal and time is not there. We hope government would succeed because Nigeria really needs a national carrier,” Ikechi said.
Industry consultant and CEO of Belujane Konsult, Chris Aligbe expressed optimism that if the Transaction Adviser was given timeline, government would be able to establish a national carrier before the end of the current administration.
Aligbe observed that what is different in the current effort and what was done in the past is that the transaction this time is very transparent and sincere, noting that what came close to it was when the International Financial Corporation (IFC) wanted to midwife a national airline for the country.
He also noted that the current process is open and getting the necessary approvals from the Federal Executive Council (FEC), adding that although the Transaction Adviser was unveiled last Thursday but it had already started working since Lufthansa Consulting was shown the door out by the federal government.
“I think the timeline given to them will be met if by the end of June they submit their report. It they submit their report by then it will be possible to realise the goal before the end of the administration. And I wish to note also that although the new national carrier will be private sector driven, but government must invest in it to kick-start it.
“No Nigerian will pay money in any product he has not seen and those who are talking about going to the Stock Exchange should realise that you cannot go to the stock market without existing product, which has at least existed for three to four years because you will have to present your financial result. Another thing that will make the new national carrier a success is that government wants to float a leasing company with about 60 or more aircraft from where the national carrier will acquire its fleet. This has not been done before,” Aligbe said.
In a recent interview, Sirika expressed optimism that this administration would soon establish a national carrier.
“I think in the next couple of months, two months maximum, we should be able to have our outline business case of this transaction and then the full business case will follow almost immediately after, because we are doing it simultaneously and after that we begin the process to establish the airline. So I will say that we are very close to having the national carrier established. Certainly, it will be within the first tenure of this administration,” the Minister had said.
The benefits of a national carrier are immense and include job creation. When established, the airline can employ as many as 300 pilots at the beginning, and it has the capacity to generate 10, 000 direct jobs and 20, 000 indirect jobs in five years.
It will help to develop Lagos and Abuja as operational hubs in West and Central Africa and establish operational benchmarks for other airlines in the industry.
A national airline will cut back on capital flight in the industry, saving an estimated $1.6 billion annually and it will lay a solid foundation for maintenance hangar. The national carrier will be the voice of Nigeria in the International Air Transport Association (IATA), African Airlines Association (AFRAA), and other global aviation policy organisations.
Meanwhile, Delta Air Lines’ week-old non-stop flight from Lagos to New York has been described as the result of a Nigerian economy diversifying beyond oil and related industries, according to Commercial Director (East and West Africa), Bobby Bryan.
“It’s a testament to the increasing diversity of the Nigerian economy,” Bryan said recently in Lagos when Delta’s Senior Vice President (Europe, Middle East, Africa and India), Corneel Koster, met with the press to shed more light on reasons behind the new route which took off last Sunday, March 25.
“When we started flying here ten years ago, the economy was essentially based only on oil and related industries and for that we fly to Atlanta and our southern hubs which are the oil destinations. As we now see the Nigerian economy diversifying with finance, with culture, with tech, that has an implication on the east coast of the United States and it becomes appropriate for those industries to fly to New York.”
Linking the financial capital of Nigeria to the financial capital of the world, the New York-JFK route complements the airline’s existing flight to Atlanta, providing daily departure and more travel choice to the US than before. The Lagos -New York route will operate three times weekly, with Delta’s existing service to Atlanta departing on the other four days.
“With the US the largest foreign investor in Nigeria, this new route under-scores our commitment to the market by facilitating trade and commerce between our nations,” said Koster. “We’re proud of Delta’s 10-year history in Nigeria and that we are the only airline to offer daily nonstop flights, bringing benefits to Nigerian business travellers while also providing more opportunities to reunite with families and friends across the United States.”
He further said, “The current environment here in Nigeria is very promising. The economic outlook is great. And we are trying to ensure our customers can connect better to the United States and also that we give our customers the latest innovation in terms of product and service.”
Commenting that Delta has a solid footprint in Africa, Koster further revealed that the airline has grown seats to Africa by 10 per cent so far this year while the seat offering to Nigeria has increased by 36 per cent.
According to the Delta team, the airline transported over 377,000 passengers between Africa and the US last year with 89,000 of those from Nigeria.
Bryan said, “Delta flies to roughly 200 cities in the United States and when we pulled the data from last year, Nigerians flew to over 170 of those cities. Nigerians go everywhere in the US and this makes what we offer all the more important.”
Delta achieved a load factor of approximately 80 per cent last year which according to the team is a real witness to the strength of the Nigerian market. Operationally, the airline went 242 days without a cancellation and was also the most on-time global carrier in the world.
Delta’s New York-JFK and Atlanta flights from Lagos are operated using 234-seat Airbus A330-200 aircraft. Offering an elevated onboard experience in every cabin, Delta’s services from Lagos feature fully flat-bed seats in Delta One that extend to 6’4” in length and offer greater privacy through their angled configuration, as well as free mobile messaging via WhatsApp, iMessage and Facebook Messenger, and optional access to high-speed Wi-Fi across all classes while in the air.
Chinedu Eze and Demola Ojo