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Airline operators decry $15bn capital flight from Nigeria annually

By on July 19, 2014

Domestic airlines have called on government to take action towards stemming the huge resources being taken away from Nigeria by international airlines, which is put at $15 billion annually.

The airlines suggest that government should empower domestic carriers and introduce policies that would encourage them operate international destinations by supporting the establishment of flag carriers that would compete effectively with foreign airlines.

They also canvased that indigenous airlines should be given the right by government to negotiate Bilateral Air Service Agreement (BASA) with foreign airlines.

They also demand that foreign airlines should be made to share frequencies with local airlines as obtained in other parts of the world by countries that want to safe and promote their indigenous operators.

The airlines said that the $15 billion capital flight include cargo and passenger flights, adding that as Nigeria is a consuming nation, the volume of imports have doubled in the last five years; that from Lagos airport alone four Boeing 747 cargo aircraft take off to the skies every day.

Speaking on behalf of the airlines, the Executive Chairman of Airline Operators of Nigeria (AON), Captain Nogie Meggison, who made this known, said no Nigerian airlines contributes anything to Nigeria’s GDP because they are not empowered. He remarked that Ethiopian Airlines, which has its largest market in Nigeria, made $20 billion profit last year and 60 per cent of that amount came from Nigeria.

“Emirates today contributes 22 percent of United Arab Emirates Kingdom’s GDP, just as Kenya Airways contributes serious money to the Kenyan economy. And if you look at all these airlines, they all take from Nigeria, why can’t we as a country sit down and think of how we can rein the market?

“If we put $15 billion or even let’s roll back the clock and say in the next two years we want to roll back 50 percent of this $15 billion and keep $7.5 billion in house in addition to our $48 billion that we made last year from oil, it would make a significant difference,” Meggison said.

He added: “Not only the cash that would remain in the system, we are not talking about the employment opportunities and the structure that will support the industry.”

Meggison said the $15 billion that is taken out of the country is equivalent to 31 per cent of Nigeria’s annual income from oil, urging government to protect domestic airlines by adopting friendly policies that would encourage their growth.

“The $15 billion translate easily to about 31 percent of our annual income from petroleum. I think we should look at the policies that have made these capital flights easy because it is cash that is available; we are not talking about a projection. We are not talking about a feasibility study or we are talking about an illusion; we are talking about something that we are planning to do.

“This is a market that is existing. We can’t allow $15 billion to be leaving our shores annually. I think we as Nigerians need to sit down, look at our policies in aviation because next to oil, and agriculture, aviation is the next biggest thing,” he pointed out.

Nigerian airlines have for long berated government for adopting and executing policies that are inimical to their growth.

 

 

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