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Doubt, Optimism Greet Proposed National Carrier Project

08 Feb 2013

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Stella Oduah, Aviation Minister
 

 
Many Nigerians with aviation industry experience doubt that the planned national carrier project will succeed, but others believe that if well-planned and well-executed, it would succeed. Chinedu Eze identifies the gains and risks of the project
 
In 2008 the Director-General of the Nigeria Civil Aviation Authority (NCAA), Dr. Harold Demuren, told Nigerian media contingent attending aviation conference in Nairobi that it would be difficult to float a national carrier in Nigeria. Demuren considered the cost of acquiring new aircraft for the fleet, the technical challenges and above all, how it could be insulated from government control and abuse.

Journalists asked the director-general that question after hearing about the comeback of Kenya Airways, which was in a sorrier state than Nigeria Airways Limited (NAL) before it was rejuvenated. It was just four years after NAL was liquidated so there was nostalgic feeling among the journalists, many of whom enjoyed the heydays of the Nigerian national carrier.

The comeback bid of Kenya Airways was fraught with challenges. There were a lot of opposition to that plan, but the government of the day was resolute and with partnership with KLM, the airline rose from the ashes of liquidation and hopelessness. This shows that there is nothing that a determined government cannot do. It also shows that mass opposition may not be right all the time.
 
Apprehension
But there are reasons many Nigerians are apprehensive about the establishment of another national carrier. Nigeria is a very corrupt society. The corruption in government has infected all the facets of life and this may mar the good plan of the project.

It will be difficult to cut off interferences from top officials of government who would put up spurious excuses to entrench their parochial interests in the new airline. And even those managing the airline may abuse their positions as it would be perceived as a government business, hence the mantra; government has no business being in business.

In the new carrier project, the Ministry of Aviation has promised that it would insulate it from the variety of these problems that will inevitably lead to its collapse. But many Nigerians still doubt that this could be done and they hinge their position on the fact that successive government might not keep to the agreement reached by the present one.
But Kenya also suffers from the heavy rain of corruption but in spite of that, Kenya Airways has thrived since its resuscitation. The major challenge it is facing today may not be government interference; it may be how to wrest some routes from Ethiopian Airlines, which seems to dominate most of African major destinations south of the Sahara. Kenya Airways was successfully insulated from government interference and Nigeria can do that with the private sector for the planned national carrier.
 
Gains
There are three major things Nigeria needs to do to develop a hub. One, it must have a national carrier; two, it must bring down the cost of Jet A1, the aviation fuel, to be comparable to what is obtained in the international market; three, it ought to have a maintenance, repair and overhaul (MRO) facility.
A national carrier can give birth to the other two. If Nigeria has a national carrier, the racket that is going on among marketers would have been eliminated. Government would have since dedicated a system of aviation fuel importation or production from one of the nation’s refineries.

Travel expert, Ikechi Uko, pointed out that Nigeria was losing its pride of place in the firmament of other nations without a national carrier.
“Aviation is the biggest diplomatic weapon in the world today. The smallest countries in the world who want to extend their power are using aviation, sports and tourism. Name them: Qatar, United Arab Emirates (UAE), Singapore and others. UAE is actually running four airlines. Every country is trying to extend their power beyond their shores and the easiest way is through aviation.”

Uko also warned: “Nigeria cannot be the centre of African diplomacy without effective airline. It is impossible for Nigeria to lead Africa without a national carrier. It is impossible. I see the opposition to national carrier as not well informed. We don’t have to create one wholly owned by government, but we need a national brand.”
 
Going it Alone
International aviation expert and former Secretary-General of African Airlines Association (AFRAA), Nick Fadugba, believed that Nigeria could successfully establish a national carrier without partnering any international airline.

He was convinced that Nigeria had all that it needed to set up a national carrier, including technical manpower.
“Let me first of all say that there is no reason why Nigeria, as a nation should not be able to run a successful national carrier without the help of a foreign airline.
“All the ingredients for a successful national airline exist in Nigeria more than in any other African country. But we have failed as a nation to harness our potential. Hence, people are now saying we have to team up with a foreign airline. That would not be necessary if Nigeria was able to come up with a sound business plan, competent management, adequate funding, the appropriate aircraft fleet, plus an enabling environment.
“There is no reason why we cannot do these ourselves, and then enter into a commercial agreement with a foreign airline partner on better terms,” he said.

Fadugba shared similar fear with other Nigerians about foreign partners in the establishment of the national carrier and recalled that the effort made with the establishment of Virgin Nigeria ended in fiasco.
“If it is concluded that Nigeria, as a nation, is incapable of running a sound and profitable national airline on its own then, of course, it could seek a foreign partner but it has to tread carefully. We have tried it before with Virgin Nigeria which failed woefully. There were many competent aviation people in Nigeria who advised the government against the Virgin joint venture but the government of the day went ahead with the deal. That airline was not optimally structured in the interest of Nigeria. So it was actually structured to fail and this was pointed out before the airline was launched.

“You can constructively criticise a government’s plan without being critical of government. When people in the past criticised the Virgin Atlantic joint venture with Nigeria it was out of a genuine concern for Nigeria and the Nigerian aviation industry. I felt that Nigeria as a nation was being short-changed by the Virgin Nigeria transaction. Those who voiced their concern were at the end of the day proved right. Therefore, I would not want to see Nigeria sign a deal with another foreign airline without due diligence and proper thought from the Nigerian perspective. The government cannot do this alone and must consult with the Nigerian airline industry. Nigeria cannot afford to keep making mistakes in the aviation industry.”
 
Government’s Plan

Aviation consultant and CEO of BeluJane Konsult, Chris Aligbe, who was a senior official in the defunct Nigeria Airways, said that Nigeria was losing so much in terms of aviation development and economic and human sources by not having a national carrier.

Many aviators in Nigeria today were trained by Nigeria Airways and since its demise there has been no consistent training programme by government or any organisation in Nigeria. For 10 years, the Nigeria College of Aviation Technology (NCAT) was comatose, until the Chief Olusegun Obasanjo administration revived it. The indigenous hands in the industry today are largely the remnants of the Nigeria Airways manpower.

“I think that since the demise of Nigeria Airways; since the ill-advised liquidation of the airline, we have not managed to come to the point where we ought to be in the aviation industry. When Virgin Nigeria was established, some people celebrated it but some of us said it was not going to work. The government then that facilitated its coming had a different roadmap. It was for the country to have a virile airline, but the roadmap of the virgin group was different.”

Aligbe explained the reason why Nigeria Airways failed.
“Nigeria Airways failed. Yes, Nigeria Airways failed for so many reasons. It was not because of the corruption per se, it was because of the managers of the airline. Who were the managers of the airline? It was the government. It appointed whoever it wanted to appoint. It dictated the policies and how the airline should be operated. It was owner-manager but unfortunately this owner-manager was managed by remote control, so those who were put in place were not there; they only took instructions.”

He said that in spite of the scepticism surrounding the establishment of a national carrier by the present administration that he fully supports it and believes that it would work.
“The current effort being made to bring up a new national carrier which some of us, including me, support should take cognisance of what caused the failures of Nigeria Airways and Virgin Nigeria. The planned carrier should go into their wealth of experience to avoid whatever caused the failure of the past ones. That is the advice that one will give while we are looking ahead.

“But I think that this country needs national flag carriers. This is what I call them, not even one only. It needs up to two. Countries that closed their national carriers are suffering it today. Zambia was the first in Africa; it never woke up, never. Air Afrique, group of French speaking countries followed, they never woke up; Sabina never woke up; Sabina was a world brand; Swiss Air was a world brand. Immediately you shut down your national carrier at that level, you are off.

“We support vehemently the growing up of new flag carriers, but we also support that it must be done in a manner that all the things that made the earlier ones collapse must be avoided and so it must be put squarely in the hands of the private sector. For me, it doesn’t stop government from having five per cent; 10 per cent for the purposes of sovereign national cover.”
Aligbe also observed that it is not enough to hand over the management of the airline to the private sector, “but I think that, that programme within the roadmap is on course; it is a right thing to do. That is our position; people can have different positions, which is their right to do.”

Tags: Business, Nigeria, Featured, Project

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