Aeropolitics: Without policy backing, partnerships, Nigerian airlines can’t thrive internationally — Demuren

By Dickson Omobola

On Wednesday, stakeholders in the air transport sector gathered at the Nigerian Civil Aviation Authority, NCAA Annexe, in Lagos to hear former Director General of the NCAA, Dr Harold Demuren, assess Nigeria’s position in international aeropolitics.

At the event, hosted by Saptco Communication Limited, Demuren drew from his wealth of knowledge to share ideas on how Nigerian carriers can survive and compete on international routes, particularly the lucrative London route currently operated by Air Peace.

Domination

Starting the conversation, he lamented how foreign airlines are dominating Nigerian routes and the inability of the country’s carriers to reciprocate.

Demuren said: “Many international airlines are increasing their frequencies to Nigeria, but we are not. When those routes are given to Nigerian airlines, they do not reciprocate.”

Capital flight

He noted that when Nigerians fly foreign carriers, whether British Airways or Virgin, “they are indirectly spending foreign exchange. When someone wants access to forex, they have to comply with certain laws because an institution oversees it. As a passenger, when you buy a foreign airline ticket, there is no control. The revenue they generate in Nigeria goes back to their countries. If they are unable to get their money, the International Air Transport Association, IATA, would make noise, and the pressure would mount. And that is why we have to support our own. I know it can be tough, but as government is doing its own, we also must do ours. Let me give an example.

“At one time, Ethiopian Airlines earned almost 50 per cent of its revenue from ticket sales in Nigeria. At that time, Ethiopian Airlines was Ethiopia’s highest foreign exchange earner. It shows the scale of capital flight. I was the Director General of the NCAA at the time. When Ethiopian Airlines said it wanted more frequencies, particularly to Port Harcourt, I said no.”

Decisions

Drawing from his experience with the defunct national carrier, Nigeria Airways, he warned that to sustain international routes like London, sound decision-making is necessary.

He said: “Wrong decisions can kill anybody. A single bad decision can kill an airline. Air Peace, before making any decision, you must think carefully.  You must do this because you make money from ticket sales. Sound decisions are crucial, and that is why it is also important to have complete government support. You cannot do it alone.”

Partnerships

He further argued that for Nigerian airlines to be profitable and sustainable on international routes, there is a need for “interlining, partnerships, strong government support and fair pricing structures” because they face an uphill battle, such as fare disparities, especially in neighbouring countries.

He said: “About two weeks ago, a friend of mine travelled abroad through Ghana because the ticket from Ghana is much cheaper. That is a regional imbalance. How many times have you seen British Airways doing adverts in Nigeria? They don’t have to do it because it is always full. The market is good for Nigeria because we have the population, but we don’t have the operators. So, they must be helped to succeed.”

Government’s role

The ex-DG noted that government has a role to ensure success on international routes, saying: “First is policy intervention. I heard that they intend to push the Fly Nigeria Act. Do you know what that means? Any government official who is going abroad on a government fund must travel in a Nigerian carrier. When Babatunde Omotoba was the Minister of Aviation, we went to the council with this same idea, but we lost. They threw it out. Now, the Minister is keen on doing it.

“Government must assist with aircraft leasing and provide access to forex. It is important. There should be timely responses in times of challenges. Do you know why I mentioned this? Many years ago, one of our airlines had a problem in Europe, and we had just quarrelled with the airline, but when the UK CAA brought complaints about the airline, we were there the following day to defend it. When the airline’s staff saw us, they asked why we were helping them, even though we were quarrelling. We told them this could be a scandal for us, and we must come together to save the situation. I say this because we must support our own airlines. A timely response is necessary because if a quick response isn’t given, it will be worse for the airline.”

Renegotiate BASAs

Demuren also called for the renegotiation of the country’s Bilateral Air Service Agreements, BASAs, saying: “We have to renegotiate the BASAs. Now, we have a minister who is a lawyer, and he knows this very well. In BASA, both sides must enjoy it. If it is one-sided, it is not a BASA. You have to protect local airlines. You cannot be wrong in supporting your own. If you don’t support Air Peace, who would? Any Nigerian carrier on the international route must be supported by the Nigerian government.”

Domestic airlines

He urged domestic carriers to start domestic frequent flyer programmes, noting that “the suffering of flyers would be reduced if a domestic airline cancels or delays a flight and the passenger can use the same ticket on another airline. If an airline is not creditworthy, it cannot operate on an international route successfully. In Nigeria, you can owe the Federal Airports Authority of Nigeria, FAAN, yet land your aircraft, but that won’t be possible at Heathrow. If an international route is done well, you can now be attractive to airlines to consider having an alliance. You have to work for it. Our carriers still have opportunities, but they must work with the Ministry of Aviation and the NCAA. After that, they must have a conversation with the Ministry of Foreign Affairs. Our airlines must interline. You also have to expand to regional partners.”

For Air Peace, the aviation expert said: “You have to be very careful. The airline’s relationship with the Minister and the NCAA must be solid. You may have money, but when trouble comes, it won’t work. Good relationships can open doors that money cannot open for you. When issues arise, your country’s representatives are the ones who will speak, and you won’t be there. Money won’t help in foreign countries. If they tell you to do this, ensure the rule is obeyed. Operational reliability is also important. At all costs, you must not abandon passengers abroad. If you have an interline agreement, another airline can pick up passengers for you in case of slight issues, but if you don’t have one, that won’t happen. When operational reliability isn’t there, passengers won’t have confidence in the airline. Therefore, they won’t buy tickets. Be extra friendly, courteous, polite and firm. You must be nice to passengers. Nigerian passengers are very sophisticated. They know their rights, but sometimes overblow it. That is why we have belligerent passengers. So, you must train your cabin crew on how to handle them. It is not just serving tea and coffee.

“Creditworthiness is also necessary because when you operate foreign routes, they will check your books. In Nigeria, you may default on your payment plan with FAAN, but that cannot be done abroad. Good corporate governance principles are important too. You have to join IATA, and they have safety requirements, security requirements, insurance level and must be clearing house compliant. When it is necessary, you should pay your dues. Remember what kicked Nigeria Airways out of IATA? Once you are out, you are out, and it will be difficult to go back. Another one is continuity and sustainability. One of the things that killed Nigeria Airways was having 10 Managing Directors in 10 years. What can it do with that? There must be some level of continuity. I am not saying you should endure an unintelligent person, no.”

Last words

While concluding, he said: “Nigeria can survive in global aviation only by turning aeropolitics into strategy. Keyamo is doing well. If he can come through with this leasing company, it won’t be bad for the country. Nigeria needs to leverage its high-value routes. Our airlines must build alliances; they can’t work without that, but there are requirements, and they must have them. You can do it. There must be policies for Nigerian carriers to compete and win. Our airlines have to compete. Nobody will stop the other airlines because it is like a race. You are all in that race, but our airlines can win.”

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