FG Appoints Transaction Adviser for Proposed National Air Carrier
|Nigerian flag .photo credit:
The federal government has appointed a transaction adviser for the new national carrier billed to take off in the next 12 months. The government also approved additional N1.57 billion for rehabilitation of local and international wings of Port Harcourt International Airport, even as it made trapped $300 million available to foreign airlines, some of which had suspended operations to the country. Briefing journalists at the end of yesterday’s federal Executive Council, FEC, Minister of State for Aviation, Hadi Sirika, said the new carrier would come on stream in 2017 to give air travellers a choice of airlines to fly. He said the new carrier would be run by the private sector, with government contributing only five percent. The minister said government had set up the machinery to realise the national carrier project by appointing an adviser who would facilitate the process.
CBN releases $300m to foreign airlines
To cushion the effect of the cash squeeze affecting foreign airlines flying into Nigeria, the Central Bank of Nigeria (CBN) has released $300 million out of the $600 million airlines fund stuck in the country.
Some of the airlines have either stopped coming into Nigeria or are threatening to stop because of the inability to remit their money out of the country.
Minister of State (Aviation) Hadi Sirika, who broke the news to the airlines after the Federal Executive Council (FEC) meeting in Abuja, said the balance would soon be released.
Sirika said: “Government through the CBN has made available $300 million out of the $600 million of the airlines’ funds stuck in Nigeria to pay the airlines to demonstrate its commitment to the sector.
“And with devaluation, $600 million could be $1 billion. With government intervention they have been given $300 million and gradually we will clear everything and once that happens, they (airlines threatening to quit) are not going anywhere.”
On the airlines’ threat to leave Nigeria, he said: “I think it is a response to how the industry is doing globally, especially Nigeria with recession, our inability to get the airlines to repatriate their currency that they earn through sales of tickets.
The AFARN President, Mr Kingsley Nwokoma, told the News Agency of Nigeria (NAN) in Lagos that the present exchange rate was seriously affecting their operations.
NAN reports that the forex concession was granted to the airlines by the Central Bank of Nigeria (CBN) following the intervention of the Minister of State for Aviation, Sen. Hadi Sirika.
Sirika had assured the airline operators that their difficulty in sourcing foreign exchange for their operations would ease as a result of the move.
However, Nwokoma said the dollar scarcity problem was still persisting, warning that more foreign airlines could close shop if the issue was not resolved as soon as possible.
Speaking for the airline, the managing director, Chris Ndulue used the period to declare the plans by the airline to further expand his operations within Africa and international routes.Ndulue who agreed that the ongoing economic recession was taking its toll on airline business and aviation where he said most transactions are done in foreign currencies, said lack of forex was badly affecting the airlines.He particularly explained how the recession has been slowing down the airline’s plan to expand annually, charging the federal government to urgently find a lasting solution to the challenges including; funding, infrastructure and other policies inhibiting the growth of the carriers. The Arik Air MD, while assuring that with the current programmes and policies of the government, that the nation would be out of recession in less than a year further spoke on the airlines’ expansion plan saying: “Expansion of operations has slowed down due to the recession we have on funding. We will have to look out in terms of sourcing for funding. We believe the current recession won’t last forever and we believe that things would change in the next one year.”
Ndulue who dropped the hint that the airline is considering foraying into Asia and Middle East in its next phase of expansion plans also announced of plans to grow its current fleet from of 28 aircraft to 52 by 2025, stressing that the airline hoped to maintain its market leadership and growth strategy.