Chinedu Eze reviews some of the key events that shaped the aviation industry in 2024, from policy implementations to breaking of barriers by Nigerian carriers and suggests the way forward in 2025
2024 may be described as a turnaround year in the aviation industry because it was the year that spelt out what President Tinubu's administration wanted to do in the sector. The Minister of Aviation and Aerospace Development, Festus Keyamo, was appointed in late 2023, August 21, 2023 to be precise.
Keyamo carried out some actions within the next four months that indicated his vision and plan; like the immediate relocation to the new international terminal at the Murtala Muhammed Airport (MMIA), Lagos.
In collaboration with the Minister for Federal Capital Territory (FCT), Nyesom Wike, Keyamo made the first substantive move toward the construction of the second runway at the Nnamdi Azikiwe International Airport, Abuja in August 2023 and by December the same year he went to the National Assembly to defend the N81 billion earmarked for the project, saying that the additional runway was crucial to meeting the growing demands of air traffic and enhance the safety and efficiency of operations at the Nnamdi Azikiwe International Airport. The work is in progress. These were the prologue to the events of 2024.
Liquidation of Trapped Fund
A fundamental action taken by the Tinubu administration was the clearing of foreign airlines trapped funds due to the inability of Nigeria to raise foreign exchange to enable foreign carriers repatriate their revenues earned in Nigeria. The federal government under Tinubu and facilitated by the Minister of Aviation and Aerospace Development, Keyamo, started offsetting the trapped funds until the total amount that accrued to over $800 million at its peak was finally liquidated.
The International Air Transport Association (IATA) confirmed that the Central Bank of Nigeria (CBN) had successfully cleared $831 million of foreign airlines' trapped funds
The highest of the trapped fund peaked on June 2023, Nigeria had $850 million in blocked funds, causing substantial operational and financial difficulties for international airlines. This situation led some carriers to reduce their operations, with one airline even temporarily ceasing services in Nigeria. The blocking of funds had severe repercussions on the country's aviation industry. But the impasse ended with the intervention of Keyamo under the Tinubu administration.
Air Peace Inaugural Flight to London
Another highpoint archived in the aviation industry in 2024, was the flight service of Air Peace to London. By March this year, the service will be one year old and since it started, there have been no hiccups, which is a good achievement for Nigeria. It was at the inaugural flight to London by Air Peace that Keyamo made it clear that the vision of the Tinubu administration is to empower Nigerian carriers, create jobs for Nigerians and make Nigerian airlines competitive.
During the event to mark the inaugural flight to London, Keyamo promised that the President Tinubu's administration would ensure that Nigerian airlines operating international destinations were protected. He regretted that over the years, Nigerian carriers had been denied the opportunity to utilise the Bilaterial Air Service Agreement (BASA) and reciprocate the flight operation of some airlines from different countries to Nigeria because of aeropolitics in which aviation authorities of these countries use to deny Nigerian carriers the opportunity to fly to some of those countries whose airlines fly to Nigeria.
One of the industry analysts stated, "Keyamo's foresight was further evident when he facilitated the launch of Air Peace's London Gatwick route. Many faulted his involvement in this endeavour, viewing it as too patronising. Today, Keyamo's decision has proven to be a masterstroke, significantly enhancing Nigeria's presence on the global aviation stage. This bold move is a reflection of his broader vision to elevate the country's aviation industry to international standards."
The flight service helped to tame airfares on that route, which was hitherto obnoxiously cut-throat.
The Cape Town Convention
President Tinubu's government has been commended variously for the job the Minister of Aviation and Aerospace Development has done in 2024 by meeting the conditions of the Cape Town Convention (CTC), so that Nigeria will be removed from the blacklist, which prevents its airlines from leasing aircraft on the long term at lower cost, known as dry lease and also to have access to international financiers that can offer them long term credit facility at single interest rate.
Nigeria's aviation global rating rose from 49 to 70.5 following the country's full compliance with the Cape Town Convention on the dry-leasing of aircraft. The Aviation Working Group, co-chaired by industry giants -- Boeing and Airbus, raised Nigeria's compliance score from 49 to 70.5 in September 2024.
The country moved up further to 75.5 from the 70.5 on dry leasing of aircraft when Nigeria prepared and signed the Practice Direction that enables lessors, with full support of the Nigerian courts, to take away its aircraft from Nigerian carriers in the case of non-compliance with lease agreements. So, as a result of this, the Aviation Working Group (AWG) removed the country from its watchlist.
The removal of the country from the watchlist would enable Nigerian airlines to access aircraft on dry leasing basis, while global financial companies would also be able to partner with Nigerian airlines for aircraft financing. This will enable Nigerian airlines to easily lease aircraft and solve the intractable problem of inadequate capacity of operating equipment, which has contributed to the high cost of flight ticket.
NCAA's Consumer Protection
During the period under review, the Nigeria Civil Aviation Authority (NCAA), efficiently maintained its stronghold in ensuring the airworthiness and safety of aircraft through effective collaboration with airlines. In the twilight of last year, NCAA reinforced its campaign on ensuring that airlines keep to the rules in protecting the interest of the passenger. The NCAA's Consumer Protection Directorate has ramped up efforts to address passenger complaints, including high airfares, flight delays, and cancellations.The NCAA has pledged to impose sanctions on airlines that fail to comply with refund policies or engage in unfair practices, signaling a stringent regime.
NCAA has also severely excoriated the behaviour of passengers on domestic air travel, their proclivity to violence in protest against flight delays and cancellation and the tendency to beat up airlines staff and destroy airlines equipment when things are not going their way. Airlines said they contribute to flight delays, as NCAA said that it would adopt a strategy to curb their excesses in the new year.
Also, NCAA workers in 2024 collectively commended the acting Director General, Captain Chris Najomo, for his welfare policy and in encouraging workers to bring out their best. He made sure that their allowances and salaries were duly paid. It was learnt that Najomo paid the backlog of allowances to the workers, including housing and promotion arrears that had lasted for eight years. He also promoted staff whose promotion had stagnated for years and these provided new tonic for the workforce of the agency.
However, NCAA could not tame the high airfares occasioned by high exchange rate, high cost of operation of airlines and limited capacity. It is hoped that this year will provide more opportunities for airlines to reduce their cost of operation, acquire more planes and bring in existing ones that have been ferried for maintenance overseas.
FAAN's Relocation of Headquarters
Although a little controversial, but industry pundits believe that one strategic decision taken by the Minister of Aviation and Aerospace Development was the approval for the Federal Airports Authority of Nigeria (FAAN) to relocate its headquarters to Lagos, an action that saved the agency several billions of naira in rent, movement and accommodation allowances. FAAN also ended the operational hiccups, including logistics challenge and flight delays by foreign airlines when it re-opened the second runway at the Murtala Muhammed International Airport, Lagos, known as Runway 18R.
Also, under the leadership of its Managing Director, Mrs Olubunmi Kuku, FAAN is undergoing positive changes in infrastructure renewal, modernization and in better collaboration with the private sector, which gave result to the upgrading of the E-wing arrivals at the old international terminal of the Lagos airport. FAAN also started renovating terminals in other airports across the country and in partnership with the state government intends to continue to expand and modernize airport facilities in the new year.
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Other achievements of Kuku, include the decentralisation of power, allowing airport managers to make immediate decisions without waiting for lengthy bureaucratic approvals before generating power in their airports. This has enabled improvement in operational efficiency. Also, the Abuja and Port Harcourt airports received international awards for security improvements, reflecting FAAN's alignment to global standards.
Expectations in 2025
There are key issues that will shape the aviation industry in 2025. One of the key factors will be how far the Nigerian government will go in facilitating the ease of aircraft acquisition and access of credit from international financiers by domestic airlines.
Also, in 2025, it is expected that the federal government will firmly kick off the concession of airports to bring in the private sector to fund airport infrastructure. This will improve airport facilities and make it easy for Nigeria to have state-of-the-art airports in addition to easy facilitation of passengers.
The Minister of Aviation and the National Security Adviser in 2025 will conclude with the plan to weed Nigerian airports of corrupt security operatives in Immigration, Customs, the National Drug Law Enforcement Agency (NDLEA) and others who extort money from passengers and damage the image of Nigeria and leave passengers with gory experiences, as they travel through Nigerian airports. The Minister of Aviation and the National Security Adviser (NSA) have been working on this and it is hoped that the plan will become fully realized in 2025.
It is also hoped that before the end of 2025, Nigeria may have a major Maintenance, Repair and Overhaul (MRO) or have firm plan to have one with a timeline. This will help to reduce the forex demand by commercial airlines that carry out major maintenance overseas.
Aviation industry observers are optimistic that 2025 will deepen Tinubu's policy in aviation, which is anchored on gaining mileage for Nigerian airlines, developing the airport infrastructure and strengthening policies that guide the aviation industry to be more efficient, safer airline operations, higher profitability and creation of more jobs.
