The former managing director of the Nigerian Airspace Management Agency, NAMA and chief executive officer of Topbrass Aviation, Captain Rowland Iyayi has emphasised the need for a deliberate and consistent policy geared towards ensuring that the airlines who are the primary players in the industry survive.
Speaking in an interview at the recent League of Airport and Aviation Correspondents, LAAC, conference in Lagos with the theme: Boosting aviation investments through policy, Iyayi noted that the airlines failing is not because the operators cannot run the airlines, but because the environment in which they operate is extremely harsh and not even conducive for growth.
He pointed out that there are multiplicity of charges in the industry that are inconsistent with the purpose of growing the industry, adding that on the other hand, government agencies that are supposed to be cost recovery agencies have been geared to grow their IGR, which is an inconsistent objective with the industry growth.
Iyayi explained that when it comes to international operations, the government is the custodian of the bilateral and the multilateral agreements.
In his words: “Those agreements are not just pieces of papers, they are negotiations. What it means is, lets take British Airways for instance, between Nigeria and the UK you have what we call a multilateral agreement, which is why you have British Airways and Virgin Atlantic, but out of Nigeria you really don’t have any operator per say. We had Med-View run into trouble, it was operating out of Gatwick. Ideally, when you negotiate a multilateral you will insist that each country must grant the designated operator prime access to the major market not the secondary market. So, Med-View going to London, we should have negotiated in the multilateral that Med-View must be given good slots not just slots, good slots at Heathrow airport, it must be part of the multilateral agreement. So that is the role of the government because if you say we have designated you to fly, fly to where? At the end of the day Med-View started going to Gatwick, Gatwick is not the primary airport that Nigerians would want to fly into. So it affects the market share that Med-View is able to corner.
“But if you put in there in the multilateral a policy direction that will show that if you are giving British Airways one, you will give Med-View one, it changes the dynamics. But when you allow them to dictate, because they will say well this is what we do in our country, if that is the case, then you can fly to maybe Minna instead of Lagos. Until you give a Nigerian carrier Heathrow airport then we are not talking. That should be the stance of government and it should be the same thing in every market in international, that is what you call aeropolitics. But the airlines can’t play it, it is the government that can play it”.
He lamented that the ministry running aviation affairs in the country is occupied by civil servants that are not core technocrats when it comes to aviation.
According to him, “these are people with different background maybe with political science, history and all the rest of them. but if you have core aviation professionals, people who are conversant with negotiating bilateral agreements and people who are conversant with the dynamics of industry internationally, then it makes it a lot easier to go into another market and negotiate because you understand what you are negotiating. But if you have civil servants who have absolutely no clue what it means to negotiate bilateral agreements then we have a problem. So, until you understand that the weaknesses are the ones that we have introduced, I mean rather than take your A team , we are taking a C team. It is not helpful. So when you go into an international negotiation you go with your best and your best are not necessarily people you have sitting in the ministry. You must get them together, people who understand the dynamics of the industry both locally and internationally. Until we have that we are not going to move forward”.
The former NAMA boss explained that the international carriers flying into multiple designations in Nigeria are carrying that out under commercial agreement which are very much of commercial interest of the government.
Iyayi said: “What that means is that the airline besides the designated airport in Nigeria which typically is Lagos will now go back to the ministry and say we want to be able to operate into Abuja, Port Harcourt or Kaduna and they will say to the ministry that for every passenger we carry on any and every of these routes we will pay you $20. Now by virtue of that agreement the ministry looks at it and say well, we will have a potential of say maybe a million passenger from this operation in a year, that is 20 million dollars and they sign the commercial agreement to the detriment of the domestic operator. So, you are getting 20 million dollars from an international operator, but do you put that back into the system to grow the domestic operator or you are taking that away from the industry and you have allowed the domestic operator to just wallow and die”?