Concerns trail Nigeria-Brazil air pact as analysts question market readiness

By Dickson Omobola

Despite federal government’s signing of a Memorandum of Understanding, MoU, to formalise the Bilateral Air Service Agreement, BASA, between Nigeria and Brazil to improve connectivity, there are questions over the route’s viability.

The Nigeria-Brazil route, which industry analysts have likened to the unproductive Nigeria-China and Nigeria-India routes, has raised fears, with many arguing that those factors required for its profitability were not in place.

Under the pact signed last week, Air Peace has been designated to operate direct flights from Lagos to São Paulo.

Confirming the development on X (formerly Twitter), Special Adviser on Media and Information Strategy to President Bola Tinubu, Mr Bayo Onanuga, had quoted the President as saying: “Increasing the direct connections between Nigeria and Brazil is another essential step to strengthen the ties between our societies.

‘’We have approved the launch of a direct flight, to be operated by Nigeria’s largest airline company, Air Peace, between Lagos and São Paulo.”

Aviation stakeholders, however, shared their concerns and suggested ways for the route to gain traction.

Commercial partnerships

Speaking to Vanguard, travel analyst, Mr Olumide Ohunayo, said: “Beyond having a designated airline, there is a need for an airport with transit facilities. The traffic from Nigerian passengers will not sustain the airline going on that route. There must be a strategy to take passengers beyond Nigeria.

“There is also the need to have partnership agreements with other airlines, especially for people going beyond Brazil. Commercial partnerships are required both beyond Brazil and beyond Nigeria, but these cannot be achieved through BASA alone.

“We have been signing BASAs over the years without any result. The last time an airline operated that route was Varig, which did for a while before stopping. Bellview tried it for a while, and could not continue because the route was not viable.

“It is just like many other routes that Nigerian airlines have tried, such as China and India. Even when there are transit facilities, time is needed to build the market. Will our private airline be able to do that without some form of subsidy or support?

“This time, government must ensure that flights are sustained. For Cargo, it is not enough to say Caverton will handle it. We must open partnership. Cargo is about business, so we must open some level of partnership between both countries.”

Route development

On his part, Chief Executive Officer of Belujane Konzult, Mr Chris Aligbe, said: “Government has done what it should do by designating an airline on that route. It behoves the airline to exploit what government has done.

‘’Route development is expensive, and no airline can enter into a destination without market research, otherwise the airline will spend too long on that route before building a viable market.

“What is the visa policy? How easy is it for Nigerians to get the Brazilian visa? Can Nigerian airline interline with any airline there? Does the Nigerian airline have what it takes to interline or codeshare with any airline there? If they don’t ask these questions, the route may struggle to take off.

“You cannot hit an average of 50 or 60 per cent load factor in one year on that route. If you do not hit 60 per cent, you will be running at a loss. It will take one full year for that route to be established, break even and be able to make profit. One key factor is interlining. Another is visa policy.”

Political marketing strategy

Meanwhile, a retired pilot with the defunct Nigeria Airways, Mohammed Badamasi, said: “I hope the government of Nigeria has statistics on the travelling public between Brazil and Nigeria before making the decision to sign a BASA.

“Many Nigerians who travelled to Brazil in the past years were mostly traders in leather products, such as handbags and shoes. Nigeria is now a world-class producer of leatherware. Except that there are other opportunities for Nigerians to explore that are not available in the country.

“Probably, the agreement is intended for cargo flights, which will serve Brazil well. Brazil has the food that Nigerians need as a stopgap until we have recovered from the shortage of food that is being tackled by the government.

“In 2013, the Royal Kingdom of Jordan signed a similar BASA. RJK Airlines operated to Nigeria with a Boeing 737 with a low turnout of passengers from both countries. The operation was suspended shortly after a few flights.

‘’This is not the first time this route has been initiated after Varig, the Brazilian flag carrier, was liquidated. I hope this is not another political marketing strategy.”

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