Domestic airline operators said they lost business opportunities and multi-billion naira investment due to government’s plan to float a national airline, Air Nigeria which was suspended on Wednesday.
THISDAY learnt there was last minute suspension of talks earlier this year between investors and stakeholders of an airline under the Asset Management Corporation of Nigeria (AMCON), as the investors cited national carrier as reason for withdrawal.
Also an airline operator told THISDAY that that his plan to lease aircraft was called off because the lessor (the leasing company) believed that no other airline would operate profitably when the national airline comes on stream so the airline in question would not be able to pay for the lease.
The national carrier was also cited as one of the reasons for the withdrawal of three different investors who had earlier indicated interest to invest in Aero Contractors, which AMCON put up for sale since early last year.
The Chief Executive Officer of Aero Contractors, Captain Ado Sanusi, who confirmed the effect of the planned national airline on other operators, told THISDAY that many investors who were attracted to invest in Aero said that “the problem we are facing is that we don’t want to compete with your national airline.”
Industry consultant and CEO of Belujane Konsult, Chris Aligbe, told THISDAY Thursday that the suspension of the national carrier project has wide ramifications.
He said what happened is a sad commentary on Nigeria when the huge amount of money lost to the project since the plan to set up a new airlines from the past years till now is considered.
“For us to cut it short, again we have not only denied ourselves and our children opportunities but we have also denied pilots, engineers and others the opportunity of getting jobs in the new airline. We have already lost West African hub to Accra, Ghana. We are also not going to benefit effectively from Single African Air Transport Market (SAATM) without a national airline. So the suspension has wide ramification because no foreign airline can build a hub for you,” he said.
Investment and aviation lawyer, Emeka Nwigwe also told THISDAY the national carrier question was cited at some of aircraft leasing and investment negotiation he had had in the past two years.
“They always cited the national carrier project, saying that other airlines would play second fiddle when the airline becomes operational. It is because of this fear that some investors withdraw their interest in investing in one Nigerian airline,” Nwigwe said.
An economist and Managing Director of Financial Derivatives Company Limited, Bismarck Rewane had earlier described the national carrier project being funded by government as misplacement of funds.
“Nigeria’s total budget for this year is $26 billion, so I don’t know why government should invest $300 million as seed capital in an airline you are not sure will make a return on investment,
“All national carriers in the world have gone in the same direction; that is, they have gone down. They are not profitable. We have South African Airways, Kenya Airways, Swiss Air, Alitalia and others. It is only Ethiopia Airline that is run profitably. So, is national airline our priority when we cannot get Apapa out of traffic gridlock? If you open Apapa gridlock it will generate more money for you than what a national carrier can get for you. I think that is better than establishing an airline for pride. The national carrier does not add value to our economy because any Nigerian that wants to travel to anywhere now can do so without the airline,” Rilwane said.