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FG faults foreign airlines’ claim of market forces on fare disparity

By on June 12, 2013

Federal Government, yesterday, faulted foreign airlines’ claims that their fares were determined by market forces of demand and supply, saying such variables should not apply only to Nigeria.

Government, which assured the travelling public that it would not relent in its efforts to ensure that an unfair air fare regime was dismantled, also lamented the docility of stakeholders in the industry on the issue.

Aviation Minister, Mrs. Stella Oduah, had been in running battles with the foreign carriers over their high fare regime in Nigeria, much higher than those charged in other countries on the West coast.

She had, last year, issued a 30-month ultimatum to the airlines to adjust their fares or face ban in the country, before the Senate intervened to see how it could interface with the airlines to do the right thing.

The fight against the unfair price regime intensified when it was revealed that Nigerians travelling on first and business class tickets paid twice more than their Ghanaian counterparts for same class cabins and at even lesser distance.

Disparity in fares

Nigerians pay over $10,000 for a first class ticket to London on British Airways, flying for less than six hours, while their Ghanaian counterparts pay a little above $4,000 for same destination, but flying for seven hours.

However, speaking with Vanguard on the issue yesterday, Special Adviser to the Minister of Aviation, Mr. Joe Obi, said the issue remained a priority to the government, stressing that government had never bought and would not buy the airlines’ contention that their fares were founded on forces of demand and supply.

Mr. Obi said: “The Minister is still on it, working behind the scenes to resolve the fare imbalance imbroglio.

“It is, however, laughable to suggest that the Minister has been compromised. Compromised by who? As the Minister has stated several times, she does not have a price and is certainly not among the crowd of past Ministers of Aviation whom you claim were compromised.”

Stakeholders in the industry have often argued that Nigeria could not fix price for what it had no control over.

Others blamed Nigerians for paying the exorbitant fares for status conferral, others attributed it to the inability of local airlines in the country to compete favourably with their foreign counterparts, suggesting that government urgently establish a national carrier, which the Aviation Ministry is currently working on.

Both houses of the National Assembly have repeatedly prevailed on the airlines to dismantle their unfair price regime considering the free access they have to routes from the country and enjoyment of multiple entries, which their home governments hardly grant to foreign carriers.

[Vanguard]