REVEALED: High insurance, others: Airline industry needs fund guarantee to survive — Capt. Iyal

Former Senior Special Assistant to the Presidency on Presidential Fleet, and Managing Director, Afri-Air International Limited, Capt. Shehu Iyal, in this interview, advised the federal government to support the industry with funding or create some kind of guarantee to cushion the high insurance rate to be comparable to what is obtained within the continent.

Excerpts

What’s your take on commercial airline industry in Nigeria?

There is a great leap and great fulfilment in airline business in Nigeria; notwithstanding the circumstances and situation they found themselves. And you can see the number of airlines we have today and you can see the facilities at the airports from what we had 10 years ago. You can also see the new planes that are coming in. The aircraft are quite modern, cost effective and very safe to use.

Is the current airlines fare commensurable with operational cost

You have to be fair to the airlines. What about the cost of aviation fuel, which you know is a major factor? What of the cost of acquisition of these aircraft, which you know is very high and you pay heavily for aircraft leasing and insurance. If you are in Nigeria, you know what we go through. But overall, I think the fares should be looked into and stabilised for better conditions both for the passengers and the airlines.

But for now, I think the demand side is higher than the supply side. And sometimes, it determines the price. Most airlines in the world don’t acquire aircraft directly; they lease.

What’s your advice on the high insurance rate

There is need for the government to come in either with funding or to create some kind of guarantee for the airline industry. There is no how we can continue with the current rate. All over the world, the interest is single digit. I think the government should do what they are doing now. Government dedicated some funds to the Manufacturers Association of Nigeria (MAN), which should be disbursed to serious minded businesses and create at a single digit interest rate. Government should also do the same for the aviation industry. It should earmark funds to be accessed on long term basis and on single digit interest rate. That will go a long way to help airlines for the purchase and leasing of aircraft. If it is leasing the government should find a way or an organisation that can stand as a guarantor for these airlines. I think it should help a lot.

Can code sharing work in Nigeria

Well, I think with time and maturity it can work. But it is not something anybody can impose on them. It is something that they, on their own will decide to do. I think we are almost there, with the Airline Operators of Nigeria (AON) and other groups that are talking to them, they will realise the value. You know some of these airlines are created out of ignorance and most of the people that established them don’t know what is in there until when they get into the market. But, I think the plan is very good and it will help a lot.

What is your evaluation of safety in the Nigerian aviation now

I think from my own experience, which I think is quite reasonable, our safety level has greatly improved. When last did we have any accident in any of our commercial airlines? So

I think it has greatly improved because of training and retraining, seminars, courses and the kind of equipment we are operating in the country now.

And whether you like it or not, I think you must give kudos to the Nigeria Civil Aviation Authority (NCAA). Whenever there is possible infringement, they come early enough to stop it.

Commendation should also go to the Nigerian Safety Investigation Bureau (NSIB) for what it is doing. I think it is doing a great job. They are properly equipped now and they have a lot of trainings for their personnel. And from time to time, they give safety recommendations emanating from their accident and incident investigations. The same thing goes with Nigeria Meteorological Agency (Nimet) about weather. I receive weather reports daily from them. I also receive warning reports on safety. So, safety wise we have gone far, far ahead than where we were some five or 10 years ago because of training and retraining, proper equipment, navigational aids and landing aids that we have, runway lights that have improved even though there is room for more improvement.