‘How Naira Depreciation Hurts Aviation Industry’

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By Chinedu Eze

The Chief Executive Officer of Nigeria’s major carrier, Mediew Airline, Alhaji Muneer Bankole, has called for policies that would ensure that the exchange rate stability achieved in the country is sustained.

According to him, naira depreciation would force airlines out of business and may hurt the industry.

Bankole, said the currency depreciation recorded in 2016 when the country suffered severe shortage in foreign exchange led to the current stagnation in the industry and also forced some airlines out of business.

He said that the reasons for this was because almost everything about airline business is imported apart from personnel, “so huge amount of foreign exchange is needed to run airline business.”

Bankole, therefore urged the Central Bank of Nigeria to continue to develop policies that would forex scarcity in the country.

Speaking at the weekend, during the 2019 Quarterly Business Meeting (BBM), organised by the Aviation Safety Round Table Initiative (ASRTI) in Lagos, Bankole, warned that any rise in the exchange rate again, would negatively affect the fortune of the airline sub-sector in the country.

He stated that for instance, forex scarcity led to the depletion in the fleet of Nigerian carriers, as maintenance cost increased, while spare parts became astronautically high.

So he advised government to introduce policies that would ensure exchange rate stability, noting that with this, more businesses, including industries locally would spring up and provide jobs for the teeming population.

“As you are aware that before this administration came into being, the naira was N150 to a dollar and that was the target of everything we were doing, including leasing of aircraft and others, but, suddenly, it went to N500 and more.

“Then, a lot of challenges came in and you still have to pay your money back in the same value of the currency of which you took before.

“We are praying now that the exchange rate should go down and not increase as predicted by some people. This will create better life for Nigerians. What government should do today is to bring it back to the minimal level by which we can grow our economy.

“It should go back to N250 or maximum N280. This can be done gradually”, he said.