Tinubu Directs CBN to Hold Quarterly Meetings with Airlines to Resolve FX Issues

•Woos foreign investors on proposed MRO, aircraft leasing in government operated airports 

•As IATA berates Nigeria over high airport charges

Kasim Sumaina in Abuja

President Bola Tinubu has directed the Central Bank of Nigeria (CBN) to hold quarterly reconciliation meetings with airlines operating in the country, with a view to resolving foreign exchange (FX) issues in the industry as well as encourage existing and new entrants into the Nigerian aviation sector.

This was just as the International Air Transport Organisation (IATA) berated the Nigerian government for stiffing airlines’ operations with heavy taxes and charges. IATA revealed that it had at least identified about 27 charges imposed on airlines by the Nigerian government.

However, Tinubu, while speaking in Abuja, yesterday, at the 7th/2023 edition of the African Aviation Conference and Exhibition, said his administration was committed to ensuring FX availability to entrepreneurs and that the CBN, “is open to provide tax holidays to new investors.”

The president who was represented at the event by the Minister of Aviation and Aerospace Development, Mr. Festus Keyamo, disclosed that the vision of his administration was to make Nigeria the aviation hub of Africa.

He said the federal government was wooing global investors to invest in Nigeria’s Aerotropolis project promising tax breaks, and other incentives.

“I wish to reiterate that my administration, will continue to sustain the support being given to the industry,” the president added.

He also called for investments into the proposed Aviation Leasing Company (ALC) and the Maintenance Repair, Overhaul (MRO) facility and infrastructure upgrade at the federal government operated airports.

He noted that the efforts were imperative towards meeting the target of making Nigeria the aviation hub of Africa in the long term.

According to him, in order to attract foreign investors, the government was already looking at areas to improve aviation business in Nigeria, and that a number of infrastructure would be upgraded.

“This includes upgrading of the Cat-3 landing system at major airports, construction of the second runway in Abuja, airport improvement programmes through concession and government willingness to partner with companies to turn major airports into Aerotropolis,” he added.

On Aircraft Leasing Company (ALC) he said the “Government welcomes major players in aircraft leasing and head lessors to invest in Nigeria airlines to provide state of the art aircraft.”

Speaking further, he opined that government would ensure enforcement of contract agreement and the rights of investors, stating, “and indeed all parties are protected; and Nigeria being a signatory to the Cape Town Convention will uphold international obligations.”

He also noted that the MRO facility was another critic aspect that could make the Nigerian aviation industry a hub on the continent.

“With the shortage of qualified engineers, the current administration is willing to provide all the necessary support for the establishment of world class MROS and training organisation,” he added.

On the summit, the president said, “I firmly believe that as key players and decision makers, this summit will provide the required atmosphere for you to discuss, and identify recovery strategies that would attract private investors to support the funding of infrastructure projects by building a transparent, stable and predictable investment climate, as well as include aviation in the continent’s national development plans.”

Speaking earlier at the summit and exhibition, Vice president, IATA, Africa and Middle East, Kamil Al Alwadi, said findings showed that Nigeria ranks highest in airport charges in Africa, saying the Abuja airport was the most expensive airport in Africa, closely followed by the Lagos airport.

He lamented the stunted growth in the region, especially Nigeria, calling on Nigerian government to create a conducive environment for airlines to thrive.

He added that Africa had put itself in a place where it cannot help its own, “expensive fuel, excessive charges, leasing and insurance through the roof, the airlines need to be financially viable too. The airlines contribute to the country’s GDP but Nigeria needs to decide what to do for them to survive.”

Alwadi, further said carriers based in Africa were expected to record a moderate combined loss of around $484 million in 2023, because the continent remains a difficult market in which to operate an airline, with economic, infrastructure and connectivity challenges impacting the industry performance.