Tasks ahead of Nigeria’s new Aviation Minister, Festus Keyamo

Festus Keyamo, a former minister of state for Labour and Employment, was on Monday sworn in by President Bola Tinubu as Nigeria’s new Minister of Aviation.

Keyamo, who hails from Delta State, is a Senior Advocate of Nigeria (SAN). He served in the immediate past administration of former President Muhammadu Buhari briefly as minister of state in the Niger Delta ministry before he was moved to the Ministry of Labour and Employment in the same capacity. He later combined his ministerial duties with the role of spokesperson of the APC/Tinubu-Shettima Presidential Campaign during the last election that brought his principal to power.

Keyamo took the baton of aviation minister from Hadi Sirika, whose efforts at reform were captured under the Aviation Sector Roadmap. The key components of the roadmap are the concession of four airports, the establishment of a national carrier – Nigeria Air, the development of agro-filled/cargo terminals and the establishment of maintenance, repairs and overhaul centres.

Other components of the roadmap are the establishment of an aviation leasing company, the development of an aerotropolis (airport cities), the establishment of an aerospace university and improvement in aviation safety and security through upgrades and modernisation of aviation infrastructure and facilities.

While some progress was recorded on the plans captured in the roadmap, the aviation sector under the watch of Mr Sirika faced many challenges too. Due to the challenges, some airlines (domestic and international) stopped or reduced their operations in the country while the nation’s indigenous airline, Nigeria Air, never flew.

Meanwhile, experts have raised key issues and policies that the new aviation minister has to contend with quickly.

“Nigeria Air”

In 2018, the proposed national carrier, Nigeria Air, was unveiled at the Farnborough Air Show in England. However, the project was shelved less than three months after Nigerians raised questions about its relevance and sustainability. The proposed airline was expected to gulp $8.8 million in preliminary cost and $300 million as takeoff cost.

In June last year, Sirika announced that Nigeria Air Limited had been issued an Air Transport License (ATL) by the Nigerian Civil Aviation Authority (NCAA).

On several occasions, Mr Sirika assured Nigerians that the national airline would commence operation before the inauguration of a new administration on 29 May. The former minister further said negotiations between the Ethiopian Airlines Group Consortium — which emerged as the highest bidders for Nigeria Air, and the Nigerian government were in progress and that the next step would be the Federal Executive Council approval of the “Full Business Case.”

In September last year, Mr Sirika announced at a press briefing in Abuja that Ethiopian Airlines emerged as a core investor in Nigeria Air with a 49 per cent shareholding. Many Nigerians were suspicious of the plan and opposed the use of limited public funds for the national carrier.

The decision to settle for Ethiopia Airlines was challenged in a suit filed by local airline operators who claimed they could manage Nigerian Air better than a foreign airline would. The operators asked the court to stop the deal with Ethiopian Airlines.

However, three days before leaving office, the former minister unveiled the airline at the ceremony, with a single aircraft belonging to Ethiopian Airlines which was repainted in Nigeria’s national colours. FEC had approved the acquisition of three aircraft.

The development further heightened concerns among Nigerians, as many took to social media to question the move and Mr Sirika’s handling of the airline’s proposed operation.

In the midst of this, in June, the House of Representatives Committee on Aviation called for the suspension of the establishment of Nigeria Air. It also called for the prosecution of those involved in the unveiling of the national carrier, describing the exercise as a “ fraud”.

The committee said: “In conclusion, looking at the total amount required to fully start the airline, which is put at $250,000,000, the Nigerian government and its citizenry can raise these funds without necessarily subjecting itself to the ridicule we have been exposed to by this recent episode. This is what we suggest the new administration look into.”

Meanwhile, less than two weeks after the airline was unveiled, NCAA announced that it rejected an application from the national carrier seeking certification to proceed to “phase two” in the process of obtaining an Air Operator’s Certificate (AOC).

“National carriers are no longer in vogue. The government should empower strong domestic airlines and designate them as flag carriers with the full support of the government,” an aviation industry expert who did not want his name mentioned said, urging the incoming minister to discontinue the entire Nigeria Air project.

“It is a monumental fraud designed to use our commonwealth to enrich a few individuals under the guise of promoting private enterprise using the government as cover.”

The Tinubu administration has not said what it plans to do about the ‘national carrier’ with Mr Keyamo expected to help the president make up his mind on it.

Concession of airports 

Another issue in the country’s aviation industry Mr Keyamo may have to urgently address is the concession and renaming of airports by the past administration.

Less than two weeks to the end of former President Buhari’s tenure, the Federal Executive Council (FEC) approved the concession of the Nnamdi Azikiwe International Airport (NAIA), Abuja, and Mallam Aminu Kano International Airport (MAKIA), Kano, to the Corporacion American Airport Consortium. The approval, which came the same day the Aviation ministry signed a Memorandum Of Understanding (MoU) for the commencement of the African Aviation and Aerospace University (AAAU), was described by Mr Sirika as “momentous” for Nigeria’s aviation industry.

However, the Senate in July faulted the process following a motion moved by Kawu Sumaila (NNPP, Kano South) at the plenary presided over by the Deputy Senate President, Barau Jibrin. By the agreement on the concession, Corporacion America Airports Consortium will make an upfront payment of $7 million to run the Abuja airport for 20 years and $1.5 million for Kano airport for 30 years. The total revenue from concessioning the two airports during the period is estimated at over $4 billion.

In a scathing review of the agreement, the Senate described the concession agreement as “not transparent or done in the public’s interest.” The senators granted additional prayer on the motion to allow the Senate Committee on Aviation to summon the authorities in the Federal Ministry of Aviation over the agreement.

Similarly, a day before his exit from office, former President Buhari approved the renaming of airports across the country. He named the airports after some prominent Nigerians, including himself. It is unclear if he discussed the renaming with his successor, Tinubu.

Dollar scarcity/Repatriation Concerns

The scarcity of foreign exchange in the country has continued to impact the aviation industry negatively as airline operators scramble to access forex for their operations.

Meanwhile, due to their inability to repatriate their funds in the country,  some foreign airlines on several occasions threatened to halt operations in Nigeria. Emirates Airlines, for instance, on several occasions last year threatened to suspend flights to Nigeria due to its failure to repatriate $85 million in revenue from the country.

The International Air Transport Association (IATA) repeatedly criticised Nigeria’s failure to allow international airlines to repatriate their profits, warning it may cause the country more damage. The association said the amount involved rose to $464 million (N199.2 billion) in July last year.

The Central Bank of Nigeria (CBN) later released $265 million to airlines operating in the country to settle outstanding funds from ticket sales.

Recently, the high cost of aviation fuel worsened the operation of domestic airlines amidst difficulty to access foreign exchange. This led some airlines to shut down operations, while air ticket prices increased.

On several occasions, airline operators complained about the operational challenges and how it has hindered progress in the aviation industry. Sirika during one of his interventions last year, pleaded with Nigerian airlines to suspend their planned shutdown of operations over the increase in the cost of aviation fuel from N190 to N700 per litre.

Amidst the rising exchange rate of the dollar, it was gathered that aviation fuel sells for over N800/litre.

Until the new administration came on board, the marketers said the Nigeria National Petroleum Company Ltd (NNPCL) was the largest importer of fuel into the country, but that most times after allocating to marketers in the country they were exposed to multiple charges and bribery.

This, they said, also contributes to the significant hike in the prices of aviation fuel in the country.

“We are being charged from the side of the authorities. We are being charged from the side of tax as a company. We are being charged by the Federal and State inland revenue.

“When we sell one litre at the airport we give FAAN N2.50. FAAN has forced itself to authorise our accounts without any other way to stop them. They will just enter our account and deduct the N2.50 multiplied by the volume that we sell for the month,” a marketer, who sought anonymity for fear of victimisation, told this newspaper.

On his part, Peter Dia, a representative of the Oil Marketers Association, called for financial audits of aviation oil marketers in the country.  He said anyone who does not have enough money to buy real aviation fuel should be stopped from selling fuel so that they don’t compromise the products and risk lives. He also wants old fueling trucks at the airport phased out.

“They should mandate airlines to be giving them a copy of the fueling receipts that they are paying so that they will know who is the one fueling them. That’s where the real sellers of the fuel would be revealed,” he said.

Rising airfares, law enforcement and safety concerns

The high prices of air tickets and the disturbing trends of unprofessional practices among airline operators, handlers and logistic services are other pressing tasks Mr Keyamo would need to address.

Amid a significant rise in the price of fuel, average airfare has seen a substantial increase within a year. As of mid-February last year, an average economy flight ticket that cost about N23,500 (if booked a few days ahead) jumped to N55,000 and above due to the high cost of fuel and other operation expenditures.

In recent years, many Nigerians switched to air travel for fear of kidnappers on the highways. But the increase in ticket prices has forced many to rethink.

“The country’s aviation industry will suffer if there’s a continuous astronomical increase in airfare,” the former chairperson of the Senate Committee on Aviation, Biodun Olujimi, said at the second edition of the Federal Airports Authority of Nigeria (FAAN) National Aviation Conference held in Abuja.

Mrs Olujimi said Nigeria’s aviation sector is bedevilled with several challenges, adding that the problem is that Nigeria cannot enforce many of its laws.

Flight delays and cancellations 

Another pressing issue the incoming aviation minister will need to tackle is rising cases of flight cancellations and delays.

The NCAA, in a report titled “Executive Summary on International and Domestic Flight Operations” published last month, said over half of the domestic flights in Nigeria between January and March were delayed.

The report which further confirmed the complaints of travellers about incessant flight delays in the country’s airports, noted that of the total 18,288 domestic flights within the period under review, 10,128 were delayed (about 55 per cent).

Many Nigerians have lamented the delays as they took to social media to narrate their experiences with some flights delayed for over 24 hours.

The NCAA also noted that the 11 domestic airlines operating in the country had 284 flight cancellations within this period.

Many Nigerians will await the steps Keyamo will take to tackle the incessant flight delays and cancellations.

Airport Environment 

Another challenge raising safety concerns within airport premises in the country are the many buildings said to be encroaching on airport lands. In May, FAAN said structures encroaching on airport land in Lagos and other parts of the country will be demolished.

“The authority hereby uses this opportunity to advise all illegal occupants to relocate from all airport lands for their own safety and security, ” the agency said at the time.

Within that period, about 13 houses within Ajao Estate and Shasha axis of Lagos were demolished by the Lagos State Building Control Agency (LSBCA) and FAAN over alleged “encroachment”.

Inefficient transport services, touting, hawking at airports

In an effort to ease logistic arrangements for airport users, FAAN inaugurated an app for taxi services at the Nnamdi Azikiwe International Airport Abuja (NAIA) last year, preventing unregistered taxi drivers from lifting passengers within the airports.

The agency claimed at the time that the technology would boost the country’s gross domestic product (GDP), yet passengers still face difficulties in accessing affordable taxis in the airport.

About three weeks ago, FAAN suspended “car hire services” at the Nnamdi Azikiwe International Airport in Abuja, Nigeria’s capital city. It said the temporary suspension was a result of the unresolved factional dispute amongst the car hire operators, which has been affecting airport car hire service operations.

Also, despite several reports revealing the activities of touts and hawkers within major airports in Nigeria, the menace still persists. Keyamo’s predecessors also promised to address the problem but were unable to.

Many airport users will hope Keyamo finally addresses the menace.

.Culled from Premium Times