‘One airline being owed $281m out of $850m trapped funds’

President of Sabre Network Africa, Dr. Gabriel Olowo has said there was no reason why Nigeria should block airline funds, saying with over $850m of foreign airlines’ trapped in the country, Nigeria has become the most indebted nation to airlines.

He said out of the $850m, one single airline is owed $281m, noting that air fares will never crash as airlines now price their tickets using black market rate.

Speaking at the business breakfast meeting of the Aviation Roundtable and Safety Initiative (Aviation Roundtable), Olowo who is the immediate past president of the think-tank group also said Nigerian airlines are mere revenue collectors going by the number of charges on their ticket.

The theme of the forum attended virtually by the Chairman of Presidential Committee on Fiscal Reforms and Tax Policies, Mr. Taiwo Oyedele was “Nigerian Aviation Sector Charges, Duties and Tariffs: Truly Exorbitant.”

Olowo stated that despite the several engagements with the Nigerian government by the International Air Transport Association (IATA), the body representing airlines in the world, the issue of the blocked funds had dragged on.

In addition to the blocked funds, he said Nigeria must revisit the issue of charges and levies on airlines, saying the country has been identified as the most expensive for airlines to operate.

He said, “IATA has severally described airlines as cash-cow, meaning that they collect cash from one party and deliver to the other. This is truly so, especially in Nigeria when you consider the revelations during the just concluded 55th annual general assembly and summit of African Airlines Association (AFRAA) in Kampala Uganda, which rose with a statement by IATA. “Lagos (LOS) & ABUJA (ABV) are the most expensive airports in the world. Pax Service Charge is $100 per passenger, while Doha (DOH) the best Airport in the world is $44 and Dubai (DXB) $40.

“Airports are not maintained and Nigeria owes $850m as at May 2023, the highest aviation debt worldwide. One single airline is owed $281m. There are difficulties in entering into more bilateral agreements. IATA said “They are tired of mediating between NG Govt and the Airlines”. This is indeed regrettable.”

Facing the domestic carriers, he said it would be difficult for any of them to survive with the number of charges and levies slammed on them.

He stated that it is not enough to designate the Nigerian carriers, saying efforts must be made to harmonise the charges and reduce the burden on the airlines.

Olowo noted that the current situation with commercial aviation in Nigeria doesn’t portray the government as being ready for the industry.

“Let cut off all these charges. Government should please make aviation a priority and the issue where it pinches the airlines,” he added.

Oyedele said the revelation about Abuja and Lagos airports being the most expensive in the world calls for concern and assured of the readiness of his committee to help aviation overcome the challenge.