Ground Handling Companies in Nigeria have cried out over the current unfavourable conditions in which they operate because of the current economic realities on ground.
In a letter written by the Aviation Ground Handling Association of Nigeria (AGHAN), dated January 26, 2024, and signed by Mr. Olaniyi Adigun, the AGHAN Chairman and Ahmed Bashir Gulmah, AGHAN Vice Chairman, to the Director General of the Nigerian Civil Aviation Authority (NCAA), the association listed the weak foreign exchange regime against the Naira, increase in diesel cost among others as reasons why the current handling rates needs urgent review.
It would be recalled that the last time domestic handling rates were reviewed in Nigeria was in September 2021 and the reviewed rates came into effect in January 2022 exactly 2 years ago. This was at a time when the United States dollar was N400 to a dolla, but today, a dollar is over N1300.
The association stated that “As ground handlers, all our equipment and spares are imported 100% and we have had to grapple with the consistent decline of the naira in the foreign exchange market for the past 24 months.
“On the local side, inflationary pressure has seen cost as diesel and other local consumables cost rise by over 200% since 2021. In addition, ground rent charged by FAAN was increased 100% while other charges such as apron passes have gone up by over 200%.
“We note that despite all these, ground handling rates have been remained static for the past 24 months. The ground handling subsector of the aviation industry has over the years absorbed the economic shocks for the sector.”
The base rate for domestic ramp operations as approved by NCAA in 2021 and the proposed new rates are detailed below:
AGHAN reasons that “it is important that this is redressed to enable the ground handling companies continue to provide services in a safe and secure manner.
“With the paltry sum that we charge and have been charging over the years, there is no way the ground handling industry aviation sector will be able to be efficient and sustainable.
“The current rates are not sustainable because of the impact of drop in naira against major currencies and impact on purchase of the Ground Support Equipment (GSE) and provision of facilities used in servicing the aircraft that are all procured abroad.”
According to the association, “the five registered ground handling companies provide over 200,000 direct and indirect employments to Nigerians with material macroeconomic contributions to the Nigerian economy.
“We operate integrated Customs Bonded Warehouses in the five major airports (Lagos, Port-Harcourt, Abuja, Enugu, and Kano) in the country, thereby contributing to Federal Government Revenue Generation.”
AGHAN also noted that “international and domestic airlines have consistently reviewed upward air tickets over the years, while the handling rates for ground handling companies have remain the same within the period.
“On the domestic side, Lagos and Abuja flight for instance ranges between N90,000 to N150,000 for an economy class ticket depending on the airline, class of the ticket and the period of the booking activated by an air traveller.
“For the international operators, with today’s rate, the cheapest flight on any airline; Lagos-London is $1,500 to $2,500 (economy seat). Yet, the handling rates have reduced despite the skyrocketing prices of equipment and machines and the constant change in air fares in the past 2 years!
“It is observed that globally 70 to 80 per cent of accidents start from the ground. So, to prevent these, the current rates needed urgent reviews.
“AGHAN hereby requests the cooperation of NCAA to support and favourably consider the new domestic handling rates as proposed in the table above, which will take effect from 31 March 2024”, the association stated.
The Aviation Ground Handling Association of Nigeria (AGHAN) is an association of ground handling companies in Nigeria, formed in 2019 primarily to promote safer handling, engage in profitable collaboration and form progressive partnership, to enhance service efficiency and standards.
Since its formation, the association has interacted with the Federal Government, Airlines, and other Stakeholders to put necessary regulations and policies in place.
