Pitfalls Nigeria Air must avoid

Last week’s unveiling of the branding and livery for a new national flag carrier, Nigeria Air, due to be launched at the end of this year by the federal government is a welcome development that will, to a large extent, buoy up the vibrancy of our aviation industry.
The initiative will, among other benefits, enhance Nigeria’s image among the comity of nations, provide a development template for the country’s aviation sector as well as bring a balance to the lopsided Bilateral Air Service Agreement (BASA) Nigeria has been signing to its disadvantage since the demise of Nigeria Airways.
“I am very pleased to tell you that we are finally on track to launching a new national flag carrier for our country: Nigeria Air,” the Minister of State, Aviation, Senator Hadi Sirika, announced before some select Nigerian legislators, heads of aviation agencies, airlines, aviation equipment manufacturers and the investing community at the Farnborough Airshow in London, the United Kingdom. The logo and colour scheme of green and white, symbolic of Nigeria’s national colours, was also unveiled to the world.
The defunct national carrier, Nigeria Airways, was run under by corrupt managers. Then President Olusegun Obasanjo liquidated the airline in 2004 in circumstances that have left experts wonder the rationale behind the liquidation when the airline could have been concessioned or privatised, considering its huge assets in spite its liabilities.
But President Muhammadu Buhari upon resumption of office as President on May 29, 2015 promised to give the country another national carrier. Sirika had previously appointed transaction advisors (Airline Management Group Ltd, Avia Solutions Ltd and Tianerro FZE) which developed the business outline that was approved by the Infrastructure Concession Regulatory Commission (ICRC).
The new airline will commence operation on December 19, 2018 with five aircraft and gradually grow capacity to 30 aircraft in five years. The OBC specified that government should inject $8.8 million in viability gap funding and the upfront grant required to leverage private sector investment going forward. It also specified $300 million capital injection in three years by the operators of the national carrier for sustainability.
The minister had assured that in spite of government’s $8.8 million fund gap, the management and business decisions of the national carrier would be 100 percent determined by the private sector managers, who will emerge core investors through competitive bidding process.
Sirika, in a statement by the Ministry’s Deputy Director, Media & Public Affairs, Mr. James Odaudu, in Abuja, said: “We are all fully committed to fulfilling the campaign promise made by our President, Muhammadu Buhari, in 2015. We are aiming to launch Nigeria Air by the end of this year. Following extensive market research, the branding of our new airline, Nigeria Air, demonstrates a true flag carrier of our nation, soaring through the skies in the shape of our nation’s eagle.”
The minister explained that the unveiling of the airline at the Farnborough International Airshow was cognisant of the fact that being the largest congregation of global aviation industry players, it afforded the best opportunity to market the airline to prospective investors and register it in the minds of all stakeholders ahead of its formal launch billed to take place in Abuja before the end of the year.
He said, “I am confident that we will have a well-run national flag carrier, a global player, compliant to international safety standards, one which has the customer at its heart. We hope to establish an airline that communicates the essence of our beautiful country, an airline we can all be proud of.”
He assured Nigerians and the international community that the government had learnt a lot of lessons from the experience of the defunct Nigeria Airways, and now determined not to repeat the mistakes that led to its demise. This, he said, informed the decision to take the Public Private Partnership (PPP) approach.
Blueprint views the unveiling of the branding and livery for a new national flag carrier, Nigeria Air, as one of the several fulfillments of the article of faith and social contract by the Buhari government to the Nigerian electorate. This is, indeed, quite laudable.
We, however, urge the federal government to go the whole hog at ensuring that Nigeria Air does not only come to fruition in December this year but is also a viable entity that is free from the ‘Nigerian factors’ including all forms of political and bureaucratic encumbrances.
The new national carrier must avoid the pitfalls that had driven the defunct Nigeria Airways under while taking a cue from thriving African national carriers like South Africa Airways and Ethiopian Airlines.