Being a paper presented by Mr Gbenga Olowo at the Aviation Economic Summit Group Breakfast Meeting in Lagos, recently.
I am raising an issue for thought for the Aviation Industry. Let us ask ourselves why we are sitting here this morning. We are sitting here this morning at the Aviation Economic Summit Group Breakfast Meeting because of the airlines, No airline. no airport, no airline; no catering service; no airline no Nigerian Airspace Management Agency (NAMA); no airline, no FAAN; no airline, no all of us.
Like Sabre Travel Solution Company, when I entered the industry, over 30 years ago, Nigerian Airways had engineering department, reservation and booking centre, cargo department, name it, the airline was everything, I couldn’t remember if Nigeria had an airport. It was Nigerian Airways. I couldn’t differentiate between an airport and Nigerian Airways. As at that time, the airline was big, I did not hear the airport asking Nigerian Airways you are owing me money. I couldn’t remember airspace asking Nigerian Airways, where is money? What is an airline today, reservation and ticketing is outsourced, catering is outsourced, engineering is outsourced, and everything is out sourced. All of us, are feeding on this empty body called airline. We now hear on the news, Federal Airports Authority of Nigeria is going to ground the airlines, they are owing, some of the foreign airlines are equally owing. I know why we owe. Economics is about reality in taking facts. When America realised that all her businesses were going bad, example, AIG, GM in the private sector, the president said, gentlemen, let us face the reality of our economic challenges; AIG was bailed out from tax payers’ money, same as GM Motors. How come that other economices are more realistic than African economy? During the time of 9/11, the airlines faced a very tough challenge world over. Insurance premium went up, it was about 350 per cent increase in insurance premium. I remember I was the Executive Director of Bellview Airlines at that time, and we made a brief visit to our then minister of aviation and complained what was done to other airlines in the world. Nigeria please help us, because our insurance premium has gone up, 350 per cent. Why did the United States of America bail out the airlines at that time? They saw that the 9/11 problem was a sovereign challenge. It was not a challenge to the airlines, it was a challenge to the sovereignty, it now affected all of us here in Africa. It was also a challenge therefore to our sovereignty, and we expected government to bail out the airlines, we never had bail out, we have to cough out the money we did not have to pay those increased insurance premium.
Today, we say we have 14 airlines in Nigeria after the liberalisation, but I say the 14 airlines are not equal to the Nigerian Airways we had years ago. What we had in the market is substitution. We are replacing the disease that killed Okada Airlines; that killed Kabo Air, that killed Oriental Airlines, that killed Harco Air, that killed Harco Air, that disease was and is still there and may likely kill very present ones. Aviation Development Company (ADC) Airlines was doing very well; professionals were there; that disease killed them, Bellview is there now, walking on one leg, but it was the best airline of the time, when Nigerian Airways was not there. It was the pride of the country, now the reality is that all of us FAAN, NAMA, NAHCO, these organs feed on the airlines – yes. The airlines must pay for services, services rendered by FAAN, landing and parking, rent. But what do we find on our tariff today as airlines? We find ticket sales charge, 5per cent, passenger service charge, 5per cent and so the airlines have become a revenue collector. I don’t know any revenue collector in this world that does the job free of charge. If the International Air Transport Association, (IATA) collects revenue for you, it charges about 5per cent of the amount collected. I also know that when tax collectors were collecting money for Lagos State government, those companies were charging on the amount collected.
The airlines in our system haven’t made our government realise the problems and challenges that we are facing. We collect the money but are not able to pay it to you because we have our own pressing need. Our own pressing need is that we are charging passengers in the aeroplane who must go and the priority is to fuel that aircraft. Rather than fuel the aircraft, I will not give the money to FAAN, NAHCO, NCAA, SAHCOL and the rest. So long I am collecting the revenue, the money is in my pocket. I will solve my problem first and the debt as my asset. How long are they carrying it as an asset! that is the reality. If you shut all the airlines, then, they will not be able to pay those funds anymore.
The best idea is not to shut them down but the reality is to say all right, as from today, lets give you 50 per cent off: we are all feeding on the airlines, and the airlines are saying, we are weak, we are sick, help us.
My humble submission is that if all of us survive on the airlines, and the airlines say we are sick, especially the Nigerian airlines, that are sick and if you don’t want them to go the way others went in the earlier days, let’s bail them out economically, that is the reality.
Olowo is president of Sabre Travel Solutions. A licenced travel agent and member International Air Transport Association (IATA).
COVID-19: Arik Airline Sacks 300 Staff
At least 300 staff of Arik Air have been relieved of their appointments by the airline’s management.
This was announced in a statement by the airline on Friday.
It blamed the sacking on the impact of COVID-19 pandemic.
The press statement was titled, “Arik Air management declares 300 staff redundant”.
The company explained that a redundancy package would be provided for the affected workers with the help of the aviation unions.
The statement read in part, “Arising from the devastating impact of the COVID-19 pandemic, leading to the constrained ability of the airline to complete heavy maintenance activities and return its planes to operations, stunted revenues against increasing operational costs, the management of Arik Air (In Receivership) has declared 300 staff members redundant to its current level of operations.
“The leadership of the impacted unions has been contacted to negotiate a redundancy package for the affected staff.”
The airline added that over 50 per cent of its workforce of over 1,600 staff have been on furlough in the past six months.
In a separate statement also forwarded to our correspondent by its Public Relations and Communications Manager, Banji Ola, the airline apologised to passengers whose travel plans were disrupted by the protest carried out by the National Union of Air Transport Employees on December 3, 2020.
The picketing disrupted operations in Lagos and prevented the airline from processing passengers at the Murtala Muhammed Airport Domestic Terminal 1 and 2.
S’East Leaders Laud FG Over EndSARS
South-East leaders on Saturday, lauded the Federal Government on the matured and responsive manner it handled all issues relating to the EndSARS protest and agitation.
The leaders of the zone, which included Governors, Senators, House of Representatives members as well as traditional, religious and youth leaders, gave the commendation in a communiqué issued after their meeting with a Presidential delegation in Enugu.
The presidential delegation was led by Prof. Ibrahim Gambari, who is the Chief of Staff to President Muhammadu Buhari.
“We thank President Buhari for the speed and restraint with which he handled the EndSARS protest, which has engendered peace throughout the country, especially the South-East.
“We, therefore, request the President to look into demands of various groups and youths with a view to resolving them,’’ the statement, which was read by the Chairman of South-East Governors’ Forum, Governor Dave Umehi, said.
It also called for joint operation by security agencies and local vigilant groups into all forests in the zone to flush out criminals and killer herdsmen with AK47 rifles.
“But we pledge our commitment to continuous coexistence with peaceful herdsmen who have been living peacefully with us.
“We stand for an indivisible and united Nigeria, built on love, fairness, equity and justice. We believe that under this platform – NIGERIA; we are bigger and stronger,’’ it said.
It also called on the Federal Government to continue its support and diplomatic push for the former Coordinating Minister of the Economy, Dr Ngozi Okonjo-Iweala, to be elected as the Director-General of the World Trade Organisation (WTO).
The statement thanked the Federal Government for the timely interventions in Akanu Ibiam International Airport rehabilitation as well as intervention in road infrastructures in the zone.
“We are grateful for the attention given to the second Niger Bridge and completion and inauguration of the Zik’s mausoleum.
“However, we urge the Federal Government to give attention to the completion of the current road projects within the zone,’’ it said.
The statement said that the states in the zone will provide money for the compensation for those affected by the EndSARS protest, help to rebuild police stations and their logistics; while engaging the youths constantly to forestall any violent development in the zone.
“We have plans to set up various empowerment programmes to gainfully engage the youths. The governors also plan to mainstream the youths in their governance to give them a sense of belonging.
Minister Hails Meeting With S’East Leaders
The Minister of Information and Culture, Alhaji Lai Mohammed, has described as “extremely fruitful” the meeting which a presidential team had with leaders and stakeholders of the South-East.
“The meeting of the presidential delegation with South-East leaders was very useful,’’ Mohammed told journalists on Sunday in Enugu.
The delegation, led by Prof. Ibrahim Gambari, Chief of Staff to President Muhammadu Buhari, met for more than eight hours in Enugu with selected South-East leaders.
Mohammed said that it was quite instructive that all the groups which took part in the meeting believed in the unity and oneness of the country, pointing out that they clearly spelt out this in their presentations.
“We listened clearly and carefully to all the positions and demands and we are going back to report directly to President Buhari,’’ the minister said.
He noted that the Federal Government had been spreading development and infrastructure to all parts of the country, simultaneously and equitably.
“We want the South-East people to be confident that the Federal Government is spreading development and infrastructure to all parts of the country equitably and will never marginalise any zone in the ongoing development and infrastructure agenda.
“This is what I want to assure Nigerians living in the South-East,’’ Mohammed noted.
According to the minister, when the team gets back to Abuja it will see what can be done immediately concerning some of the positions and demands made by the South-East leaders.
The presidential delegation met with South-East governors, statesmen, elders, religious and traditional leaders, as well as market women and youth leaders.
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