The Airline Operators of Nigeria (AON) has criticised the deal between the Federal Government and Ethiopian Airlines to float the country’s air carrier, Nigeria Air, alleging that local operators have been ignored in the process.
Speaking for the AON at the second investigative hearing by the House of Representatives in Abuja on Thursday, the Chief Executive Officer of TopBrass Airline, Rolland Iyayi said that Ethiopian Airline was poised to benefit most in the Nigeria Air project.
This was as the Speaker of the House, Rt. Hon. Femi Gbajabiamila expressed concern over the project.
He said: “The issue of the national carrier is very important. It is something we are all paying attention to. We just want to make sure we get it right. There have been some misgivings. Some issues have been raised. But there are issues that need clarification”.
Chairman of the House Committee on Aviation, Nnolim Nnaji also criticised the engagement of another country’s airline to own a major stake in Nigeria’s national carrier, warning that it may be counterproductive.
A month ago, the Federal Government announced that it had picked Ethiopians Airlines as its technical partner for the national carrier project, Nigeria Air despite denial earlier in the week.
The company, Nigeria Air Limited also announced the commencement of recruitment of crew members for its operation that is expected to be launched shortly.
The Minister of Aviation, Hadi Sirika had said that the Nigerian government would retain five percent stake, Ethiopian Airlines would have a 49 percent, while 46 percent of Nigeria Air would be owned by Nigerian investors.
According to Sirika, the Federal government anticipates raising $250 million from the private sector.
However, the AON disagreed with the deal, with Iyayi saying, “What Ethiopia is trying to do in essence is to make sure they have a hold on the largest market in the continent, to be able to project and propel themselves to Nigeria. Essentially, today they have 135 aircraft. They intend to double (the number) by 2050. Ethiopia as a country does not really have that market but they have a footprint in several local markets.
“Ethiopia will not help you to create an aviation hub when it has one in Addis Ababa. They are building a new airport. It will be very difficult to see how Ethiopia will commit to a national carrier in Nigeria that will be for the benefit of Nigerians. We dare to say, as AON, that if airplanes are brought into the Nigerian market, the first thing Ethiopia will do, as a strategy, is to do a fare cutting strategy for market penetration. When you cut the fares to compete with the local carriers — Ethiopia is awash with cash —they can afford to come to the market and project a six-month fare with domestic carriers.
“I can guarantee you that if they do that for six months, 90 per cent of the domestic airlines will be out of business. Afterwards, they will now dominate the domestic market through their monopoly. What happens when they increase the fare? Ultimately, Ethiopia will fly international; it will be flying on Nigeria’s designated routes”.
The Chief Executive Officer of Skye Jet, Kashim Shettima corroborated Iyayi, and also raised the issue of those being recruited for Nigeria Air, especially the pilots.
“This airline is a very sensitive issue”, he said.
Similarly, Chairman of Air Peace, who is also AON VicePresident, Allen Onyema,stated that domestic airlines must be carried along.
However, the Minister of Aviation said the national carrier would kick off before the end of December 2022, noting that 20 aircraft with petrol engines had been ordered for training purposes, nine of which had been delivered.
Sirika added that President Muhammadu Buhari gave a marching order to ensure that the carrier was launched at the just concluded Ministers’ retreat.
He said: “When I came in as a minister, we didn’t arrogate to ourselves knowledge and wisdom. We believe in the stakeholders on whose behalf we are servicing. The national carrier is in the works and we have advanced significantly. And just yesterday, Mr. President, in concluding the retreat, has directed that this airline must work between now and December. And it will work by God’s grace.
“Why should there be a national carrier? We do believe for the reasons I said in this address, we need to have one. And it is not as what people think about an ego or to own something and say it belongs to Nigeria; no. It is to structure it in such a way that it will come to stay. We are not going to end up with another Kabo or Okada, Chanchangi, etc. We also have given every single Nigerian the opportunity, especially those in the sector, to participate in this airline so that we create an airline that is proper, well set up and stands the test of time and dynamics.
“We have so far, from all the submissions, identified the partners, the investors and we are currently negotiating and processing the AOC. We are tweaking the business case in such a way it will give us an advantage and set it in the most efficient manner. So, I want to commit here, by the grace of God, between now and the end of the year, the airline will work”.
