11 Ex­perts sug­gest work­able mod­els for pro­posed na­tional car­rier

Weekly Trust - - News - Ab­dul­la­teef Aliyu, La­gos Why Nige­ria Air­ways col­lapsed?

Thir­teen years af­ter the liq­ui­da­tion of the for­mer na­tional car­rier, Nige­rian Air­ways, the move to bring back a na­tional car­rier is gath­er­ing am­ple mo­men­tum. Daily Trust on Satur­day looks at var­i­ous op­tions be­ing bandied by ex­perts to float a long-last­ing and en­dur­ing car­rier.

Pres­i­dent Muham­madu Buhari hinted on the se­ri­ous­ness of his ad­min­is­tra­tion on the na­tional car­rier project when he told the vis­it­ing Pres­i­dent of International Civil Avi­a­tion Or­ga­ni­za­tion (ICAO), Dr. Olu­muyiwa Aliu that he is un­der pres­sure to es­tab­lish a na­tional car­rier.

He how­ever put a caveat. Ac­cord­ing to Buhari, Nige­ri­ans need to know what hap­pened to the for­mer na­tional car­rier.

“I equally sup­port a na­tional air­line for both pa­tri­otic and eco­nomic rea­sons. We have enough trained cit­i­zens in­clud­ing pi­lots and en­gi­neers. But Nige­ri­ans need to know how we lost the one we had be­fore,” Buhari was quoted as say­ing.

In ret­ro­spect, Nige­rian Air­ways was a pride of the na­tion fly­ing the coun­try’s flag el­e­gantly across na­tions of the world. It had the best of fa­cil­i­ties - mod­ern air­crafts, main­te­nance, re­pair and over­haul (MRO) fa­cil­ity, among oth­ers. In terms of man­power, its pi­lots and en­gi­neers were among the best in the world. They had the best of train­ing in mod­ern aero schools in Europe and Amer­ica. Up till date, most of the best brains man­ag­ing the avi­a­tion sec­tor both as reg­u­la­tors and op­er­a­tors were left­overs of Nige­ria Air­ways.

Af­ter many months of wob­bling oper­a­tions, the then ad­min­is­tra­tion of Chief Oluse­gun Obasanjo in 2004 liq­ui­dated the air­line. Not only were most of the air­line’s as­sets sold at giveaway prices, many of its work­ers were left stranded and de­spon­dent in their var­i­ous duty posts in Nige­ria and abroad.

Many for­mer work­ers of the air­line till date rue the re­course to liq­ui­da­tion by Obasanjo as they in­sist the as­sets of the air­line far out­weighed its li­a­bil­ity and so liq­ui­dat­ing it should not have been an op­tion.

The Man­ag­ing Di­rec­tor/CEO of MedView Air­line, Al­haji Muneer Bankole who was one of the staff of the air­line in a re­cent in­ter­view said, “It was a wrong de­ci­sion to liq­ui­date Nige­ria Air­ways be­cause the re­sources were there. Nige­ria Air­ways owned al­most 75 per cent of the prop­er­ties in GRA with as­sets all over the world; so the re­sources were there. In the business par­lance, when you have a chal­lenge like Nige­ria Air­ways had, the first thing you look at is if your as­set out­weighs your li­a­bil­ity, so why did he liq­ui­date it?

“The best thing he could have done was to look for a part­ner or a strong tech­ni­cal com­pany prob­a­bly out­side Nige­ria to take over the prob­lem. If he had done th­ese, things would have turned out dif­fer­ently. But we lost it. We had over 60 bi-lat­eral air ser­vice agree­ments but peo­ple are now com­ing to take us for free, to­day it is free for all, an open sky for ev­ery­one.”

The Nige­ria Air­ways which was wholly owned by the Fed­eral Gov­ern­ment was said to be a vic­tim of po­lit­i­cal/gov­ern­ment in­ter­fer­ence which even­tu­ally killed the car­rier. Ex­perts are unan­i­mous in the as­ser­tion that the air­line fell along the line fol­low­ing cease­less and sense­less in­ter­fer­ence in the run­ning and op­er­a­tion of the air­line.

Though many le­gacy air­lines around the world like the Bri­tish Air­ways, Delta, Emi­rates, Air France/KLM, Lufthansa, as well as ma­jor car­ri­ers in Africa like the Ethiopia Air­line, Kenya Air­ways, RwandAir, among oth­ers have gov­ern­ment stake, they are mostly man­aged like pri­vate en­ti­ties.

Ex­perts and stake­hold­ers are how­ever unan­i­mous that to bring back the na­tional car­rier, gov­ern­ment must not have a con­trol­ling eq­uity. This, they say, would in­su­late man­agers of the car­rier from po­lit­i­cal in­ter­fer­ence which killed Nige­ria Air­ways.

Mr. Chris Aligbe, for­mer Gen­eral Man­ager, Pub­lic Af­fairs of Nige­ria Air­ways, said, “the kind of air­line we should have is one that the gov­ern­ment does not own a con­trol­ling eq­uity or man­age. It is good, it is a highly re­spon­si­ble act for the present gov­ern­ment to say we must re-es­tab­lish a na­tional air­line but it should be re-es­tab­lished in the best way that it should be, not in the form of Nige­rian Air­ways where gov­ern­ment owned 100 per cent, no. Gov­ern­ment should not own that kind of 100 per cent, gov­ern­ment should not even in­vest money. It should be zero fund­ing by gov­ern­ment but the gov­ern­ment should have eq­uity; what we call sweat eq­uity. Then once it is re-es­tab­lished, the Nige­rian pub­lic should have ac­cess in two, three years to buy into the air­line so that it be­comes a prop­erty of Nige­ri­ans and gov­ern­ment’s eq­uity would be lim­ited to about 10, 20 per cent, not more than that yet gov­ern­ment should not in­vest any fund in it, funds should be used for other things, that is what we need.”

For­mer Com­man­dant of the Mur­tala Muhammed Air­port, Group Capt. John Ojikutu, rtd, also spoke in sim­i­lar veil, say­ing gov­ern­ment has no business in business. He said, “Whether they call it na­tional car­rier or they call it flag car­ri­ers, it is not some­thing they should use pub­lic money to fund. We should not use pub­lic money to es­tab­lish it. Let pri­vate sec­tor fi­nance it. But how­ever, it must meet the best prac­tice. It must be sub­jected to the na­tional reg­u­la­tion. There is no rea­son for gov­ern­ment to in­ter­fere in the run­ning of that business. It is the in­ter­fer­ence of gov­ern­ment in both pub­lic and pri­vate en­ter­prises that is killing busi­nesses in this coun­try.”

Al­ready it was learnt that some in­vestors have sig­ni­fied in­ter­est in fund­ing the na­tional car­rier. Min­is­ter of State for Avi­a­tion, Sen­a­tor Hadi Sirika also hinted on this re­cently that Boe­ing and Air­bus are passionate about forg­ing part­ner­ship with the gov­ern­ment in re-fleet­ing the na­tional car­rier.

With the dwin­dling re­sources avail­able to gov­ern­ment, stake­hold­ers say pri­vate in­vestors are bet­ter placed to fund the car­rier.

For­mer Pres­i­dent of the Na­tional As­so­ci­a­tion of Air­craft Pi­lots and En­gi­neers (NAAPE), Com­rade Isaac Balami, who ex­pressed de­light over gov­ern­ment’s de­ter­mi­na­tion to start a na­tional car­rier, said a com­mit­tee re­cently set up by gov­ern­ment has submitted work­able mod­els. Ac­cord­ing to him, the na­tional car­rier can be­gin with four or five air­crafts while a pro­gramme for pe­ri­odic ex­pan­sion is put in place.

He said, “This na­tional car­rier would have a min­i­mum gov­ern­ment in­ter­est in it be­cause if gov­ern­ment is go­ing to have a con­trol­ling share, it is not good for the coun­try. It has to be pri­vate sec­tor driven but the gov­ern­ment should have a small stake like five or 10 per cent so that they can be around to see what is hap­pen­ing but they can­not de­cide to see how the air­line is be­ing run. It should be run by pro­fes­sion­als and ex­perts.

“You know that you don’t start air­line with 100 air­crafts. You must start small and grow. You can start with five air­crafts and ev­ery two, three months, you in­tro­duce two or three air­crafts and you keep ex­pand­ing the routes grad­u­ally. If you bring so many at the same time, they would all be due for C-check at the same time so you won’t have any flight.

“You have to keep in­tro­duc­ing them grad­u­ally. There are mod­els; there are ways that ex­perts in the sec­tor do it. Th­ese are left for ex­perts to sit down and look at the route struc­tures, look at the traf­fic, the load fac­tor and see how best those air­craft can be in­tro­duced. How many do we need for a start? How many do we in­tro­duce ev­ery quar­ter? When should we do West Coast? When should we go international? Th­ese are things that have al­ready been looked into and the re­port is with the gov­ern­ment.”

Of­fer­ing a dif­fer­ent per­spec­tive, an avi­a­tion con­sul­tant, Al­haji Ali Ma­gashi said gov­ern­ment needs to in­vest in the na­tional car­rier for a start.

Ma­gashi, who is also the Chair­man of Aso Sav­ings and Loans said, “Twenty top air­lines in the world are ei­ther started by gov­ern­ment and in most cases still owned by gov­ern­ment (United, Delta, Amer­i­can/ US Air­ways, Lufthansa, BA, Air France/ KLM, Turk­ish, Quan­tas, China South­ern, China Eastern, Sin­ga­pore, Ja­pan, Cathay Pa­cific, Malaysian, Emi­rates, Qatar, Eti­had, Ethiopian, Egyp­tAir, South African).

“The above ex­pe­ri­ences show that all ini­tial in­vest­ments are made by gov­ern­ments, and it’s only when the air­lines are de­vel­oped, economies are grown and in­sti­tu­tions of com­pli­ance have ma­tured that the air­lines are pri­va­tised.

“With all the above gov­ern­ment sup­port, th­ese gov­ern­ments still con­tinue to sup­port and bail out th­ese air­lines in pe­ri­ods of sys­temic eco­nomic down turns.”

But ir­re­spec­tive of the mod­els adopted, it is gen­er­ally be­lieved that hav­ing a na­tional car­rier would fast-track the growth of avi­a­tion in the coun­try, boost man­power de­vel­op­ment and ad­dress the prob­lem of un­em­ploy­ment among pi­lots and en­gi­neers as over 400 pi­lots are cur­rently un­em­ployed.

A Nige­ria Air­ways air­craft be­fore its col­lapse

Sen­a­tor Hadi Sirika, Min­is­ter of State for Avi­a­tion

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