Post-COVID-19: Experts call for review of Bilateral Air Services Agreement

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SOME aviation experts have called for an immediate review of Nigeria’s Bilateral Air Services Agreement (BASA), to create an enabling business environment for Nigerian airlines.

They made the call at the third edition of the aviation webinar, organised by AELEX partners and monitored by the News Agency of Nigeria (NAN) on Friday in Lagos.

NAN reports that the Webinar panel of discussion was moderated by Theophilus Emuwa.

Emuwa, who is a Managing Partner, Head of Tax at AELEX, said there was need for transparency in the management of funds for the aviation industry to grow.

Mr Nick Fadugba, the Chairman of African Business Aviation Association (AFBAA), said the multiple entry points and the frequencies of foreign airlines had been a disadvantage to the Nigerian airlines.

He said this is as opposed to the advantages the agreement was supposed to present.

“At the time the bilateral agreement was made, the Nigerian airlines in play at the time were relatively new.

“Now, to ensure the growth of the airlines, there’s a need to review the agreement to properly incorporate the airlines as the agreements do not favour the average Nigerian carrier.

“The multiple entry points have diluted the domestic market for the carriers,” he said.

Fadugba noted that there was a need to overhaul the current business plans of the airlines with emphasis on unit cost, load factor and yield.

He said that for the airlines to rise above the current situation, there should be cooperation, through joint training, Maintenance, Repair and Overhaul (MRO), spares pooling, joint operation, interlining and code-sharing.

Similarly, Ms Iyabo Sosina, an international aviation expert and former Secretary-General of the African Civil Aviation Commission (AFCAC), stated that the future of air transport in Nigeria was bright despite current challenges.

Sosina stressed on the need for rebuilding and repositioning of the industry.

According to her, there is a need to focus on the Nigeria Civil Aviation Authority (NCAA) without unnecessary political interference with the authority.

She, however, advised that airlines in the country should be reduced to not more than four, adding that these airlines must be able to boast of between 10 and 20 aircraft each.

Sosina also noted that more than ever before, there was a need for airlines to initiate collaborative ways of doing business as mergers could not be forced.

Also, Dr John Arthur, the Group Executive Finance, Ghana Airport Company, said that airports need to start afresh by collaborating with each other and aviation stakeholders.

Arthur advised that African countries should come together to share expertise in order to make the aviation industry viable.

On her part, Sindy Foster, the Principal Managing Partner at Avaero Capital Partners, said that the Nigerian aviation industry had been in crisis way before COVID-19 pandemic.

According to Foster, the lack of capitalisation and the low propensity of Nigerians to fly has been a major issue, which more than ever before, has become pertinent to address.

“There is need to look into the factors frustrating the airline business. One of which is the ticket prices. Multiple taxations should be removed to encourage airline growth,” she said.

Ms Adefunke Adeyemi, however, pointed out that the airline industry in Africa had experienced a revenue loss of about 6 billion Dollars and flights went down by 94 per cent at the end of April.

Adeyemi, who is the Regional Director, Advocacy and Strategic Operations at International Air Transport Association (IATA),  stated that despite government implementing significant relief measures across the globe, there was need to do more.

According to her, IATA has advocated financial support for Africa from various organisations like UNWTO, world travel and tourism council and the African Airlines Association (AFRAA).

While supporting the points made by other panelists, Mr  Richard Gimblett explained that governments across the world were devising measures to restart the aviation sector.

Gimblett, a Partner at Holamn Fenwick Willian, a UK-based law firm, said that the Nigerian government should not be left behind.

He said that the government could restart the industry by providing direct financial support to passengers and cargo carriers.

Gimblett added that the government should also ensure relief on fees, charges and taxes, make forex available for technological innovations, while also engaging with the leasing and financial community.  (NAN)

– Jun. 5, 2020 @ 13:49 GMT |

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