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European Shares Fall Over Growth Fears

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European shares fell sharply and the euro hit a near three-week low on Tuesday on worries that Greece will not be able to complete a major debt restructuring deal and on growing concern that global economic growth is weakening.

Private sector Greek creditors have until late Thursday to agree a debt swap needed to release its 130 billion euro second bailout and avert an imminent messy default, but fears have risen that acceptances may not meet the minimum required.

A disorderly Greek default would probably leave Italy and Spain needing outside help to stop contagion spreading and cause more than 1 trillion euros ($1.3 trillion) of damage to the euro zone, the group representing private bondholders warned in a document seen by Reuters.

“This week will determine the success or otherwise of the largest sovereign bond restructuring in history,” said Bill O’Neill, chief investment officer for EMEA at Merrill Lynch Wealth Management.

The euro fell to $1.3125, its weakest since February 17, according to Reuters report.

China’s lowering of its growth target and data pointing to Europe possibly slipping back into recession have also eroded the optimism on global markets generated by the European Central Bank’s provision of massive loans to banks since December.

“We’ve had the ECB bathe us in this warm glow of liquidity but politically there is a lot more to be done, and there is still a risk that tensions could rise again into the spring and summer,” said Rabobank’s senior currency strategist Jane Foley.

The potential for Europe to fall into recession was confirmed when statistics agency Eurostat said the economic output for the euro zone fell by 0.3 percent in the fourth quarter of 2011, compared to the previous three months.

Leading indicators for the current quarter have signaled further weakness since the start of the year.

SAFE HAVENS SOUGHT

The growing worries over the Greek debt swap drove demand for safe-haven German government bonds and hit peripheral euro area debt. Without the additional rescue funds agreed by euro zone finance ministers on February 21, Greece will be unable to make billions of euros of bond payments falling due this month.

The front month German Bund futures contract rose 42 ticks from the previous close to 140.25, after setting a record high of 140.39 during the day on Monday.

Spanish 10-year bond yields rose back above the 5 percent barrier, climbing 6 basis points to 5.05 percent. The Italian equivalent rose two basis points to hit 4.97 percent but continued to fare better than Spain.

“The market is really now looking at, on one side, what will happen to Greece and, on the other, the details of the next macro data releases to get an idea of growth in the second half of this year,” said Alessandro Giansanti, strategist at ING.

The weaker growth outlook saw stocks in China and Japan fall for a second day and triggered weakness in Australian resource shares, sending the MSCI world equity index (.MIWD00000PUS) down 0.5 percent to 328.23.

In Europe, automobile shares were being hit on the weaker demand outlook, with the falls led by French car maker PSA Peugeot Citroen (PAR:UG.PA – News) after it announced a planned 1 billion euro capital raising would involve a deep share price discount.

The FTSE Eurofirst (FTEU3) index of top European shares was down 1.2 percent at 1,067.26 points, its lowest level in over a week, although the index is up around 6.5 percent year-to-date.

“Latest macroeconomic figures from the euro zone, especially at a time when the ECB’s major liquidity operations are over, have raised concerns of a recession and disappointed markets,” Koen De Leus, strategist at KBC Securities in Brussels, said.

In oil markets Brent crude traded around $123 in a volatile market on Tuesday as fears of a disruption in Iranian supplies battled with the prospect of demand falls from slowing economies in China and Europe.

Front-month Brent crude fell 98 cents $122.82 a barrel at one point after climbing to a day’s high of $124.39. U.S. April crude gained 25 cents to $106.97.

The commodity-linked Australian dollar slipped 0.5 percent to $1.0621, as the nation’s central bank held its cash rate steady at 4.25 percent for a second month, but left the door open for an easing should the economy materially.

The New Zealand dollar also hit a near 6-week low of US$0.8122, down 1 percent on the day.

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NSIB, AAAU Sign MoU On Air Safety Training

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As part of efforts to curb mishaps in the aviation industry, the Nigerian Safety Investigation Bureau (NSIB) has signed a Memorandum of Understanding (MoU) with the African Aviation and Aerospace University (AAAU) to deepen training on preventing and reducing accidents in Nigeria’s air transport.
Director, Public Affairs and Consumer Protection of NBIS, Mrs Bimbo Olawumi Oladeji, in a statement, said NSIB granted AAAU access to its facilities to facilitate an efficient exchange of resources and expertise.
According to the statement, the Director-General/Chief Executive Officer of NSIB, Captain Alex Badeh, who spoke at the ceremony held at the NSIB Training School, noted that the MoU sets the stage for facility sharing, capacity building, and collaboration between the Bureau and AAAU.
“I am confident that this MoU will enhance the effectiveness of our collaboration and commitment to promoting safer skies and operational excellence in the aviation industry in Nigeria and beyond”, Badeh said.
Registrar of AAAU, represented by the Director of Physical Planning and Works, Engineer Masud Aliyu Yerima, was also quoted in the statement, saying, “The journey of AAAU’s establishment and progress would have faced considerable challenges without NSIB’s generous support”.
He commended Badeh for his exemplary leadership and steadfast dedication in propelling NSIB to greater heights, and affirmed AAAU’s readiness to engage in mutually beneficial endeavours with NSIB.
“This partnership marks a significant milestone in fostering a culture of safety and excellence within Nigeria’s aviation sector, and both NSIB and AAAU are poised to leverage this synergy for the benefit of the industry and the nation at large.
“The African Aviation and Aerospace University, AAAU, is the first Pan-African university dedicated to aviation, aerospace, and environmental science.
“Addressing two critical needs within the continent’s industry, AAAU tackles the research and development gap in Africa’s aviation and aerospace sector while simultaneously cultivating a skilled workforce to propel it forward”, the statement added.

By: Corlins Walter

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Naira Rebound, Air Peace’s Expansion Deepens International Route Competition 

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he commencement of flights operations on the London route by an indegenous Carrier, Air Peace Airline, and the recovery of the local currency have sparked fresh competition on international routes.
Air Peace, Nigeria’s outstanding indigenous airline, may face a prolonged market battle with many foreign airlines with decades of experience in the industry following its entrance on the Nigeria-London route.
Some of the industry’s experts say the airline required support from the government and a strategic approach to stay competitive.
Analysts have also stated that the strategic move has garnered high praise from stakeholders in the aviation sector, considering that Nigerians were paying exorbitant prices to travel from Nigeria to London, but that sustaining this momentum will require more than just offering low prices.
On March 31, 2024, the 11-year-old airline made a bold statement with its inaugural flight, using a Boeing 777 aircraft, offering a capacity of 274 seats and carrying 260 passengers from Lagos to London.
It sold its tickets for N1.2m, a price way lower than the rates offered by most foreign airline operators plying the same route.
Just two weeks after entering the market, Air Peace’s Chief Executive Officer, Allen Onyema, complained on Arise TV that foreign airlines were undercutting prices in an attempt to push Air Peace out of the market.
Onyema said, “We are aware that there are devilish conspiracies. All of a sudden, airlines are pricing below the cost. One airline is advertising $100  and the other $350. If you peel up your entire aircraft and carry people on the wings, it is not even enough to buy fuel.
“Why are they doing that? Their government is supporting them because Nigeria has been a cash cow for everybody. The idea is to take Air Peace out, and the moment they succeed in taking Air Peace out, Nigerians will pay 20 times over. It would happen, God forbid, if they were able to take Air Peace out”.
It was gathered that an economy ticket for a flight scheduled for April 29, 2024, from Lagos to London costs about N679,375 on Ethiopian Airlines, an operator with 75 years of experience.
Air Peace priced the same ticket at N1,090,750. The difference is that on Air Peace, it will be a 6-hour non-stop flight, while on Ethiopian Airlines, it will take 16 hours with one stopover.
Last Friday, Ethiopian Airlines reduced the price of its London ticket by 0.77 per cent to N1,628,660 from  N1,641,249 two weeks ago.
In the same period, Air France’s price dropped to N1,687,824, nearly halving from last month’s N2,482,138.
On March 4, 2024, Lufthansa offered the Lagos-London route for N1,966,165. Qatar Airways provided the same ticket for N2,016,824, and KLM priced it at N2,448,740.
This continuous decline in air ticket prices was also driven by the strengthening of the naira against the US dollar and the payments of airlines’ trapped funds by the Central Bank of Nigeria.
Minister of Aviation and Aerospace Development, Festus Keyamo, had confirmed that the Federal Government, through the CBN, had cleared all the trapped funds (foreign exchange backlogs) to the tune of about $160m.
Beyond the ongoing price war, the Air Peace Chairman had also lamented the challenges with ground handling and space allocation at the London Gatwick Airport, adding that no airline has faced such obstacles before.
He noted, “On the inaugural flight out of London, 24 hours before departure, the management of Gatwick Airport moved us to another checking area instead of the designated one.
“The area they provided had a malfunctioning carousel, forcing us to manually transport luggage 50 meters away, causing delays”.

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PH Airport Users Lament Down Turn In Flight Operations 

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Users and business operators at the Port Harcourt International Airport, Omagwa, have decried the downward trend in flight operations at the airport.
Some of the users and operators told The Tide that flight operations at the airport, rather than go upward, have steadily been irregular, and diminishing steadily.
A regular air passenger of the airport, Simeon Echeonwu, in a chat with The Tide, said many airlines, both domestic and international operators, that usually operate at the Port Harcourt airport, have stopped operations, whereas others that are still operating are no longer very stable as before.
Echeonwu noted that airlines such as Aero Contractors, United Nigeria, and Green Africa airlines, now operate about one flight, twice a week, unlike before that they flew every day on Lagos and Abuja to Port Harcourt.
Also speaking, former Chairman of the FAAN Accredited Car Hires Association, Clifford Wahunoro, lamented that the down turn in Operations has affected the business of car hires.
“If you have noticed, I have not been regular at the airport for some time now, because business is no longer flowing at the airport as before. I will not fold my hands and be sitting down doing nothing, so I have to look for other things, so I come when I think there will be something.
“You can see that between 12noon and 1pm, after that segment of flights, when you have few flights arrival, many people will close for the day, and when you wait till evening, flight like Dana may come very late at night, and sometimes, it will not arrive, and by that time, many people will not like to book for commercial vehicle”, he said.
Meanwhile, a travel agent, who wished to be anoyimous, decried the rate at which the airport is going down in terms of flights operations, noting that Port Harcourt airport ought to be competing with the other major airports like Lagos and Abuja.
He queried if such was a calculated attempt to bring the airport to its kneel in terms of flight operations, while other major airports have steady flow of flight operations both for domestic and international.
TheTide observed a continuous distortions in flight movement at the airport. Some of the airlines, like Max air, which many passengers patronize, have completely stopped operations, and no new airline has been added.
Apart from the Air Peace Airline that has maintained some level of stability in operations, other few operators have been involved in either steady rescheduling of flights, cancellation and regular delay, resulting in poor and unpredictable flight movement, which affects or determine other businesses in the airport.

By: Corlins Walter

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