A new wave of ‘rash decisions’ in Nigeria’s aviation industry

AT last, the row between the Ministry of Aviation and the United Kingdom over the controversy generated as a result of allegations that the later systematically chased a Nigerian airline out of the Abuja-London route is coming to an end.

The Nigerian flag carrier, Arik Air, had petitioned the Ministry of Aviation, alleging that British Airways ‘elbowed’ it out of the Abuja-London route; leading to the Ministry threatening to cut BA’s frequencies into Lagos to three from seven, followed by a schedule that could have made it impossible for the airline to continue with its operations to Nigeria.

The ministry called for dialogue with a view to normalizing what it said was an imbalance in the Bilateral Air Services Agreement (BASA).

British Airways, which had received so many bashes over the dispute between the two governments, had told its own side of the story that BASA is a deal between two countries and it does not any way a party to the agreement. The attack on the airline is said to be the only option left to government to arm-twist the carrier in a bid to get the attention of the British government.

Just on Tuesday, the Ministry after a meeting with the British authorities in Abuja over the face-off said it has ‘succeeded’ in getting something out of its action. This is where the action of the Ministry needs to be scrutinized and that validate the view of most people that the sector should brace up for more of such ‘actions’ that seems to have yielded little or no result.

Spokesman for the Minister of Aviation, Mr. Joe Obi in a statement he sent to reporters in Abuja said, “The Nigerian government and the British authorities held high level negotiation this (Tuesday) morning. These discussions are still on going. The outcome thus far is as follows;

  • With respect to the high fares charged by British Airways and the associated regional imbalance, the airline made an offer of a 20 per cent reduction in the lowest Business Class fare between Nigeria
  •  The Nigerian side considered this as insufficient. The Nigerian government is still very concerned about the regional price disparity. We strongly believe that this regional imbalance should be dismantled. In other words, BA should offer the same or similar fares from Nigeria to the UK, as is the case in any other equidistant destination within West Africa.
Obi disclosed that the British authorities requested to be given an opportunity to carry out an independent study of the regional pricing disparity in the UK/Nigerian aviation market.

He equally stated that with respect to slot at Heathrow airport, seven slots per week from Abuja had been secured for Arik at ‘’prevailing commercial rates”, noting that these efforts will require a review of current slot allocations and additional funding.

“Towards this, FAAN is considering applying commercial slot rates for slots into Murtala Muhammed International Airport in the spirit of BASA.

Two issues stand out here and which tend to vindicate those who believed that the Ministry took decisions that is not in tandem with aviation in the modern day.

By agreeing that Arik will get slots at Heathrow at “prevailing commercial rates”, clearly shows that slots are totally different from BASA and all the intimidation from the foot soldiers from the ministry only goes to show that aviation in Nigeria is totally in reverse gear (apologies to Ijeoma Nwaogwugwu who had been vilified for her views by people who believed that their views were more superior to those who strongly felt that the minister was ill advised on how to pursue her ‘nationalistic posturing”.

One also hopes that they will be humble enough to admit that there is clear difference between BASA and slots, and that BASA does not automatically translate into having slots free of charge.

How come Arik is still going ahead to buy slots to land its Abuja flights in Heathrow at “prevailing commercial rates”.
In a civilised country, the ministry would have been asked to tender a reserved apology for misinforming the nation. What then is the essence of the parley with the British authorities if Arik would still to go London with purchased slots to Heathrow?
The only positive in the whole matter is that the government said it would also introduce slots at the Lagos airport so that airlines like BA, Lufthansa, and Virgin Atlantic Airways can pay.
One expects the ministry or the Federal Airports Authority of Nigeria (FAAN) to be more creative in their revenue generation drive, rather than the serious situation we have found ourselves.
Regrettably, it means that it had to take the current fiasco for FAAN to know that ‘slot’ could also be done here.
Slots came about because of the high usage of Heathrow. Currently Heathrow has about 98 percent capacity utilisation. What is the capacity utilisation of MMIA?

At times, one begins to question the kind of advice and advisers at the ministry’s disposal to warrant this obvious lack of strong policy to drive a sensitive sector like aviation.

The second aspect of the matter is forcing the carrier to cut down on its airfares on Business Class by 20 per cent. Now if it is wise to cut down on Business Class seats, what happens to economy class passengers? Is airlines business no longer commercialised? Why should an airline be ‘harassed’ to cut its fare in a libralised sector? Why is the ministry not asking Arik for instance to lower it own fare so all UK passengers could migrate to fly with them as a way of helping Arik.

There’s a clause that fares between both countries have “double disapproval”.

This means that before fares decisions are taken, both UK and Nigeria have to agree. It is also important to highlight a part of the BASA, which clearly states that BASA undertakes that both parties shall “within legal and practical constraints” make slots available for the airlines to operate their full entitlements. Note “legal and practical constraints”, which is obtained at Heathrow.

Heathrow has congestion constraints. Has the ministry bothered to ask why airfare from Accra to London is far cheaper than what is obtainable on Lagos-London route, the same six-hour distance? The answer is simple.

Business operations in Nigeria carry more risks than in other African countries, with cost of aviation fuel, high landing and parking charges by FAAN, said to be one of the highest in West Africa.
Has government provided the enabling environment for businesses to survive?

This agenda of the ministry could have been achieved with far more success with a strategic economic diplomacy blue print. No wonder the UK authorities called the bluff of the Ministry over so many of the arm-twisting tactics to succumb to intimidation.

When Air France’s aircraft ran unto herds of cows at Port-Harcourt Airport, six years ago, the Nigerian government looked the other way while the carrier bore the cost and huge inconvenience of having to lodge departing passengers in hotels, coupled with the provision of other allowances to them.

Aviation fuel sells for between N180 and N200 per litre; about the highest in the world, not to mention huge tax paid for parking and landing. All these are factored into the cost of airfare that is fixed by the International Air Transport Association (IATA), the clearinghouse for global airlines.

Post Courtesy Nigerian Guardian
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