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FG suspends planned national carrier, Nigeria Air

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FG suspends planned national carrier, Nigeria Air

We didn’t approve project, says Presidency

 

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The hope of having a national airline has been dashed at least for now as the Federal Government, yesterday, announced the suspension of the national airline project, Nigeria Air

 

Minister of State for Aviation, Hadi Sirika, announced the suspension yesterday following a decision taken at the Federal Executive Council (FEC) meeting.

 

Many looked up to the new national airline that was expected to be launched on December 19, 2018 as the  hope of matching foreign carriers in the area of reciprocity or as a counter to foreign airlines, which make huge revenue from the country.
In 2017, foreign airlines operating to the country raked in a whooping N500 billion in tickets sold.

 

With 81 domestic and international routes that the carrier was expected to operate to, not a few felt that capital flight out of Nigeria would have been reduced at least by 20 per cent or more.
Sirika, who spoke to newsmen in his office, however, did not give details behind the cancellation of the project.

He said: “Today (Wednesday) the government at the FEC took decision to suspend the national carrier project till further notice.
“It has nothing to do with pressure from stakeholders and it is also not for political reasons.

“The decision to come up with national carrier in the first place was as a result of the lack of capacity of the existing carrier to meet demands.”
One of our correspondents, however, gathered from a Presidency source that the Federal Government did not approve the takeoff of a new national carrier for the country in the first place.
The source confirmed to reporters that the Economic Management Team (EMT), presided over by Vice President Yemi Osinbajo, has already distanced itself from the decision.
The source said EMT did not give the go-ahead for the project, saying that it recommended that government should not set up a national carrier with public funds.

According to the source, EMT wants the Ministry of Transportation to, instead, accelerate the search for a strategic investment partner, who will finance and manage the new airline.
“In the absence of a borrowing plan for government participation, the President ruled against spending money that is not in the budget.
“Promoters of the idea of the new national carrier were, therefore, asked to work towards 2019 budget if any government investment is to be involved,” the source said.
On the possible thinking of the interested parties, Sirika said government had shown serious commitment towards the project, adding that the suspension would not affect government’s credibility before international partners.
Until now, the establishment of a national carrier for the country, Nigeria Air, was in top gear as a result of repeated calls from a section of the society.
The airline was scheduled to commence operations on December 19, 2018. The proposed national carrier targeted 81 routes, comprising 40 domestic, regional and sub-regional and 41 international routes.
Sirika had, in July this year, unveiled logo for the airline in Farnborough, United Kingdom.
The Federal Government, according to Sirika, would only own a maximum of five per cent shareholding and that the venture would be public-private partnership (PPP). This means 95 per cent of the investment would be private sector driven.
The supposed new national airline would require initial capital of between $150 million and $300 million (about N108.2billion) while government sought a strategic partner to operate the carrier.
The suspension of the airline jolted many stakeholders who told New Telegraph that the decision was a setback to the dream of having a national airline for the country.
Managing Director of TopBrass Airlines, Roland Iyayi, stated that it was possible government suspended the project because it was too close to election year, stressing that investors may not be willing to invest because of uncertainties that may arise.
His words: “I think after election, we are certain they will re-strategise and give it two years’ timeframe.”
Speaking in the same vein, Managing Director of Aero Contractors, Capt Ado Sanusi, said anything that does not follow due process would crumble.
“They failed to sell their ideas. There were no offices, no structure in place. From the look of things, President Muhammadu Buhari does not believe in air transportation. He is more interested in mass transportation through his massive rail project.”
He further stated that they should not have killed Nigeria Airways, stressing that Buhari was more interested in bringing back Nigeria Airways.
“It would be difficult for investors to bring in their money to put into a project that is not too tidy,” he added.
President, Aviation Round Table (ART), Elder Gbenga Olowom, stated that the project was loaded with a lot of suspicion.
“We were left to speculate and we thought it would be a reality because of efforts that were put into it. Despite the problems, we still gave it hope that it would fly.”
Nigeria, he said, needs more than one strong airline; otherwise, it will be a mirage to reciprocate.
“We don’t want a monopoly. We need two strong airlines and give the existing ones strong backing,” he added.

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  1. Pingback: FG suspends planned national carrier, Nigeria Air — Voiceheadlines

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