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A RoadMap in 2019 To Next Level


President Mohammadu Buhari


The President new Ministerial nominees should bring some hopes of the likely returns of some earlier ministers whose performance in the first term were well above the others. The aviation minister belongs to the group that the sector had an enviable stride than others. Not returning him to the ministry and bringing a new person could create a downward and dangerous trend, before the new individual could gather confidence to consolidate on the previous achievements or move on a new path for any progressive development. It would therefore be better to consolidate on the previous achievement by fine tuning their level of development within the specified timings to next level of development:

a. Consider merging Arik and Aero and designating the eventual airline as a flag carrier if and only if their debts, liabilities and assets can be respectively estimated and a credible plan is worked out for recovering sufficiently the government intervention funds and the liabilities to other creditors within and outside the country (6 months/12 months).

b. Determine if the two Airlines could be merged, with a view to selling them to technical foreign investors, patriotic and credible Nigerians at reasonable cost to setup a flag carrier only if the government funds can be fully recovered and those of other creditors except if they are willing to be part of the new carrier with their credits in Arik and Aero (6 months/12 months).

However, recovering over ₦300 billion debts owed by these two airlines in 30 years can only translate to making a minimum profit of ₦10 billion annually which in their present level of operation is practically impossible. Designating any airline as flag carrier on a BASA/international routes should not be made on political pronouncement rather good government policy which must be based on successful performance from the NCAA Audit Reports of five years each to advance from domestic operation to Regional Continental and International operation.

c. There should be no going back on the plan for a national carrier and as earlier suggested the composition and share ownership must include experience foreign technical partner/investor, credible Nigerian investors and the Nigerian public through the Stock Market to give it a national image and not a government image. However, like you said at the last stakeholders’ forum, federal government including states who wish to be part must together not have more than 10% share in the national carrier capitalization (12 18 months).

d. With the plan for airport concession, FAAN should be upgraded to a Holding Company having all the terminals concession to private companies on behalf of the federal government. Give out all the 20 federal airports for concession at once to remove the burden of providing annual budgets for their maintenance and improvement from the government except recovery intervention. However, the concession must be limited to passenger and cargo terminal building, Aircraft Aprons/ Parkings at terminal car park toll gates, land office building and any other non-aeronautical infrastructures (12 18 months).

e. Consider a plan to commercialise NAMA like the ATNS of South Africa. All other aeronautical infrastructure under FAAN now should be handed over to NAMA; these include the Runway, taxiways and associated lighting and approaching lightings. The aircraft operators with their hangers and building fall into the concession programme (12 18 months).

f. Review the Civil Aviation Act 2006 on the sharing formula for NCAA, NAMA, NCAT, NIMET and AIB from the TSC/CSC charges with a view to reducing NCAA share from 53% to 40%, and increasing the shares of NAMA, NCAT, NIMET and AIB to 35%, 12%, 7% and 6% respectively. NCAA has more than 10 other sources of revenue, less equipment, infrastructure and less number of staff than the other government agencies and services providers in the sector (6 12 months).

g. We must revisit and know the true value of the TSC and CSC Earningscollected by the NCAA. If we accept the NCAA figure of 2 million international outbound passenger only in the last 2 years, allowing concession for 20% of the figure as non-tariff for West Africa and Continental passengers for the TSC and without considering fares of the first and business class passenger, and at the rate of ₦450,000 for the remaining 80% passenger, the ticket sales cannot beless than ₦800 billion or ₦40 billion TSC of 5% due to NCAA, NAMA, NCAT, NIMET and AIB. This figure is about ₦300 billion more than the highest Ticket Sales earnings of about ₦500 billion in the NCAA figure for 2 million passenger traffic declared in 2017. You may wish to know that up till the end of this July 2019, NCAA is yet to declare the TSC/CSC earnings for 2018 (3 – 6 months).

h. Reviewing the BASA may involve a lot of diplomatic technicalities and languages but reviewing all the Commercial Agreements with foreign airlines especially those that are given multiple frequencies, landings and destinations outside the BASAs, are within the competence of the power of the ministry and therefore your own power. To retain and sustain the domestic routes and the markets for the Nigeria private airline commercial operators, there is a very urgent need to review those Commercial Agreements that have given multiple landings and destination in this country to foreign airlines. You should consider therefore restricting the foreign airlines landings to either Abuja or Lagos and to any other airport in the alternative geographical zone to their first choice of Lagos or Abuja for each airline within its operating BASA. No foreign Airline should go to Lagos and Abuja but any airline can fly multiple frequencies as many times as it wishes daily and weekly to its allocated airports (6 12 months).

i. Cost of fuel has for long been a major complaint of high cost to airline operations. To reduce thehigh costs, we must find an alternative to bridging the supply of fuel from Atlas Cove through Ejigbo to the Airport and remove the cost of bridging by trucking and the demurrage on the trucks at the airport. All these contribute about 30% to the costs of Aviation fuel which can be reduce to about 10% if the pipelines from Mosimi/Ejigbo to airports or repaired. There is also the danger of contamination through the bridging with trucks most of which are used for supplying other petroleum products. There are many evidences in the AIB reports on some aircraft accident investigation suggesting fuel contamination as the causes of accidents (12 18 months).

j. Airport Security came under the focus of the industry stakeholders and the public in the last 4 weeks. First was the British High Commission concern, which he expressed to the MD FAAN that MMA lacks shuttle buses for passengers connecting flights between local and international passengers’ terminals. He was also concerned about the heavy traffic on the road which could be source of danger or insecurity to new comer passenger to the airport. Providing Shuttle Buses may not necessarily solve the problem of passenger connecting their flights timely between terminals without solving the problem of the *Airport Service Road which has been turned to a *Public Road* , and has invariably increased the airport insecurity. MMA in its present state is in the midst ofuncontrolled urban development and complicated road network. Without FAAN management exercising proper ownership of the Road the security of the airport infrastructure and the safety of travelling passengers cannot be sufficiently guaranteed irrespective of the number of shuttle buses that are put on the road for passenger service between the terminals (6 12 months).

k. My suggestions are: first, close the road linking the Bisam Area to the airport service road and secondly, close the toll gate which the only purpose is to generate revenue from the public users and not the airport users. The heavy traffic on that road could be on albatross to the management of airport in the event of any serious occurrence of Airport Emergency Incident or Accident. In the midst of the complicated and uncontrolled urban development, the airport could be a reservoir for the overflow of disturbances from the environment and the surrounding building that stranded the airport perimeter fence could be launching pads for any attack on the airport. The recent incursion of a Nigerien into Azman aircraft at the airport Runway holding point could be a rehearsal for such attack and a big thing waiting to happen.

l. Many of the properties around and outside stranded on the 23Sq km Airport perimeter fence of the airport are said to be on the airport landed property; The Ministry, FAAN and Lagos State government should work together as was done recently at Enugu airport to recover part of the land from those who have encroached into the land. FAAN should subsequently construct a road around the 23 km perimeter fence to enhance the airport security away from any launching of attack on the airport from the surrounding areas (12 18 months).

An ICAO Security Audit Report had recommended twice, in 2004 and 2008, that MMA needs a security fence as a secondary fence to the existing perimeter fence where it becomes impracticable to enhance the existing perimeter fence for security fence. The plan to spend $1 billion for security gadgets on the existing perimeter fence may come to nut if none of the two recommended options is first considered.

In the interim the internal patrol of the perimeter fence can be delegated to the NAF being an interested party in airport security as an operator of military aviation at a joint user airport.

In our effort to establish a national carrier and flag carriers the concession of FAAN airports and the commercialization of NAMA we need to revalue our investment in infrastructure and reassess the annual IGR Earning in the sector. We should also fine tune the plans to develop our commercial aviation infrastructures otherwise, we may have no product to compete with our contemporaries in the continent or contribute to the AFCTA that was recently signed by the country.


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