Kingsley Nwokoma is the President of the Association of Foreign Airlines and Representatives in Nigeria. In this interview with FUNMILAYO FABUNMI, he speaks about the hike in airfares, and the plight of local airlines, among other industry issues.
How would you react to the recent release of $265m trapped funds to foreign airlines by the CBN?
The question should be how come it’s when there is a problem and airlines are threatening to leave the Nigerian market that the Central Bank of Nigeria thought it wise to do this release? Emirates and other airlines had been talking with the CBN, trying to see what they could work out with the CBN before the escalations came up. So, for me, what is more important is not just about giving out the money ($265m). It’s about making sure that this does not continue.
This issue is not a one-day, one-month ,or even one-year problem, it has been there over the years. So it’s still very important for stakeholders to sit down together, find out the root cause of these problems, and proffer a final solution to them. We need to find a final solution to the non-repatriation issue.
If they have to sit down to agree on that, it’s okay, but this is what we think we can do monthly. This is how we can work around it. So, It is important to ensure that this issue doesn’t occur again; because it’s not acceptable, it ridicules us before the world and foreign airlines. My own take is that it’s important we find out where we got it wrong, and then start a corrective process to avoid a repeat.
The CBN has given out $265m, but the issue is that every second, tickets are being sold. So that means that the figures keep coming up every second; intending passengers are buying tickets.
What is the way out of this problem? We must find a solution so that we don’t get back into another accumulation that will make us start running up and down. There must be a way to look at this holistically, from tracing the root cause to finding final solutions.
Is AFARN engaging CBN to repatriate the remaining part of the $460m?
If you notice, AFARN has been very vocal about this repatriation. We know that it’s important to keep agreements. This is Bilateral Air Services Agreements, country to country, and we won’t want a situation where things get that bad that the traveling public will start going to other climes or neighboring countries to travel.
Of course, AFARN will continue to engage and appeal to the CBN, Ministry of Aviation, Ministry of Finance, and every other relevant government agency, to make sure that whatever is owed to the airlines is paid. This will help the airlines to continue their operations in Nigeria. Like I have been saying all the time, without money safety will be affected.
Without money maintenance would be affected, without money, the airlines wouldn’t be able to pay the debts they owe service providers and aircraft manufacturers like Boeing and Airbus. If other countries are like Nigeria, then there will be no industry, and there will be no airline operating because they need funds. And as I have always been saying, we are the most hit by COVID-19; so our recovery level is extremely slow. In other climes, the government has supported airlines by giving them lifelines.
We have heard how a government gave an airline $1bn. The United Arab Emirates also did. Our airlines got N1bn, how much is that in comparison? So the airline needs all the support, we will keep engaging and hopefully, we believe the government will listen to us and make sure that these funds are properly repatriated. But we also have to sit down, look at the root cause and make sure that this is sorted out once and for all.
Foreign airlines have increased fares on Nigerian routes due to the problem of trapped funds, do you think this is justified?
It’s not only because of the trapped funds. You know, it is garbage in and garbage out. Even before the trapped funds’ issue, our rates were a bit higher than that of other climes. This is because foreign airlines pay for other services in Nigeria. They make these payments to the various government parastatals; and if those charges are high, it will affect the fares. If I’m paying so much for services in the country, it will reflect on my ticket prices and cargo tariffs. There are landing and parking fees, et cetera. There are many services that foreign airlines pay for in Nigeria. Then with this new non-repatriation, airlines are now selling their tickets a bit higher. However, if the government listens properly and sits down with the airlines, I am sure they will get to that point where airfares will be cheaper.
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Why do you think foreign airlines are not entering into interlining and code-share agreements with local airlines for the distribution of their passengers within Nigeria?
I have been saying this all the time, do you know that we don’t have any of the domestic carriers in the International Air Transport Association’s clearing house? And if you are not in the IATA clearing house, foreign airlines will not partner with you, and you know what that means? Safety is also involved here.
If I’m buying a ticket, say I am buying a British Airways ticket, and maybe the ticket is supposed to take me from London to Uyo. If for instance Ibom Air is partnering with Virgin Atlantic or British Airways, and anyone buys the ticket from the UK, the British airline will be held responsible if anything happens along the line here in the Nigerian sector of the flight.
This is because there’s an alliance, there’s a code-sharing, and the passenger will go back to where he or she bought the ticket. Again, it is sad and a big shame that none of the Nigerian airlines is in the IATA clearing house.
It is not about being IOSA-certified but being in the IATA clearing house. It is a major deal. We have been encouraging our domestic carriers to fulfill all the requirements and join the IATA clearing house, once they are in the IATA clearing house, then it is easier to code-share.
Do you agree FG should stop multiple designations and frequencies for foreign airlines?
The Federal Government that is doing knows what it is doing in its own wisdom. Have the local airlines been able to service the entire country? That’s the question. And let’s even say this, how many foreign airlines have been given multiple designations? Apart from Qatar, Emirates, and a few others, how many others are currently having multiple designations? It’s for convenience and I think the BASA should address that. What is good for the goose is also good for the gander.
What are your thoughts on the plan by domestic airlines under the aegis of Airline Operators of Nigeria to import aviation fuel? Is that a good move, is it sustainable?
The question is: are domestic airlines set up to import aviation fuel? They were not established to import aviation fuel. They are just an association established to protect the interest and welfare of local carriers. But now that the primary problem is that the refineries are not working, my view aligns with that of the GMD of NNPC Limited that in a year and a half time, Dangote Refinery, and other refineries will start to work. Capacities will be enhanced and Nigeria will stop the importation of Jet A1, and petroleum products.
Hopefully, if that promise is being kept, and we can refine it, then it’ll be wonderful. But for them to start importing, it’s still going to go through the same cycle. Are they not going to be paying for it, are they not going to go through the same cycle that the fuel companies are also going through?
So, what I think is that the government still needs to sit down and find a way out of the problem. This is because if the increment is reflected on the tickets, and if the ticket prices continue to go high, then air passengers may not have a choice but to look for alternatives, which they’re doing already.
Considering the recent security breach at the new terminal in Lagos, how secure would you say our airports are?
Our airports are still secure. That’s what I would say; I won’t say our airports are not secure. We all know that we have a high rate of insecurity in Nigeria; so that is why we have to really triple-check our security systems.
If we were doing it with the two eyes open, we should be doing it with four eyes open now. So, whatever has happened, the Federal Airports Authority of Nigeria has to do a lot of work, get to the root cause and also make sure that this doesn’t happen again.
Like we say all the time, security is a collective issue. It’s collective because if we start to ask questions, we won’t stop asking questions, because whoever that has got into that aircraft must have gone through a lot of points, but what is important now is to make sure that this never reoccurs again.
We have to make sure our airports are properly secure because if anything goes wrong, it would be not just be a national disaster, but a world disaster.
Would you say that the aviation industry has fully recovered from the impacts of COVID-19?
No, the industry has not recovered. The aviation industry is the worst hit. You know it got to a point where thousands of workers were asked to go back home and many carriers had to get government support.
If not for that, there would have been no airline operating. Also, if you still look at it, people are not really flying that much again, people are trying to make the best out of their vacations. People only fly when it is very necessary.
So, the airlines too have canceled orders, including aircraft orders from Boeing and other aircraft manufacturing companies. So that is why this non-repatriation of funds was a big deal because it was tough.
It’s very tough for the airlines and you know that in this industry it’s a 100 per cent safety target. You need money to make sure that safety is enforced via maintenance, via operations, and, making sure that your staff members are well paid on time.
So, a healthy airline can only operate if it is financially together. The aviation industry is still affected, they’ve not come out of it fully yet. Hopefully and gradually too, we hope the world would come back.
Culled from THE PUNCH.
