Nigeria is set to launch its new national carrier, Nigeria Air at the end of this year.
According to a tweet by Tolu Ogunlesi, a communications official, no more than 5 percent stake in the new airline would be owned by the Nigerian government. The government is touting the venture as “fully private sector led.”
Nigerian aviation minister Hadi Sirika told the media that initially, the routes of Nigeria Air will cover domestic routes and the broader West Africa region. The airline has also examined the possibility of future expansions into 81 potential destinations which includes China and India where it would expand “when the time is right” the minister said.
Currently in Nigeria and across West Africa, there was a “total absence of efficient air transportation”, Sirika said. and private firms did not adequately serve the market. Nigeria Air was also designed to “provide employment for people” he added.
This is not the first try by the Nigerian government to develop a national carrier. In 2003, the majority government stake holding airline Nigeria Airways had to be wound up. And then in 2012, operations were ended by Air Nigeria, a tie up between the Nigerian government and the Virgin Group.
Issues of governance was the reason that the previous airlines of Nigeria had to be folded up, Sirika said. he however added that such governance issues and capital problems would be resolved.
A new terminal at Nnamdi Azikiwe International Airport in Nigeria’s capital Abuja is to open in October as part of a plan to expand airport capacity.
Data from the International Monetary Fund’s 2017 figures shows that Nigeria is Africa’s largest economy. This is primarily because of the oil reserves of the country. but in recent years, the country has suffered because of the drop in global oil prices.
According to the Washington-based think tank Brookings Institution, at the beginning of 2018, Nigeria surpassed India as the country with the largest number of extreme poor. The think tank said that comparted to about 73 million in India, Nigeria had about 87 million people living in extreme poverty by the end of May,
Matthew Kindinger, an expert in the region at emerging markets advisory firm Frontier Strategy Group, told the media that for sub-Saharan airlines to create any significant impact on migration, tourism and travel, there has to be significant state backing and robust management.
Otherwise, “their capacity to sustain route expansion and lower the cost of air travel will be limited,” he said.
“To boost regional migration, tourism, and travel, Nigeria first needs to sort more urgent challenges, such as airport infrastructure, aviation fuel shortages, foreign currency shortages, and lowering the admin burden and cost of getting a visa.”
(Adapted from CNBC)