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African Aviation: African Open Skies may not Benefit Nigerian Airlines says Arik Manager

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By Friday Nwosu

The Deputy Managing Director, Flight Operations, Arik Air, Captain Ado sanusi, has said the liberalization of African airspace being championed by the International Air Transport Association (IATA) may not be beneficial to Nigerian carriers.
Sanusi said this in a report published by Thisday newspaper at the just concluded IATA Day in Abuja.

He said the open sky for Africa plan is good and recalled that it was introduced by the United States, which over the years had well developed aviation industry, but noted that the industry is still relatively young in Africa.

He said at a level playing field, open sky is good where everybody has equal opportunities, but the lope-sided reality of African airlines, where most of them are still operating on the fringe, it would be difficult to successfully implement the open sky policy. “Open skies at a level playing ground is a good thing. This is where everybody is at the same level; the same opportunities, it will be an advantage. But that is at a level playing ground. If we look at what is happening in the Middle East; the Middle East carriers don’t have open sky agreement with the United States. And the United States is still objecting to some of them because of the way they receive funding and subsidy from their governments.

“In that case that is no longer a level playing ground. That is why the United States is objecting to their coming into their country. So in Africa too we must have a legal framework where we define ownership of airlines, where we define subvention, where we define contribution and where we define outright bailout funds that are given to airlines in respective states before you start talking about liberalization and open sky,” Sanusi said.

He said this is necessary because some airlines are owned by government while other are run and owned by individuals; some airlines are even subsidized and government could float an airline, subsidize it and use it to fly to other countries.
Sanusi said open skies for Africa might not even encourage competition, which should be one of its cardinal objectives.

“If you are going to do open sky, you must define ownership of airlines so that we will know that; yes; this airline is owned by the state, it is promoted and subsidized by government. We have over 175 million people in Nigeria. If 10 percent are travelling; that is 17 million people. This may be the population of one country in Africa. So if you look at that and a country decides to target this market, then they could subsidise an airline and then go there to go and capture that market,” he said.

Sanusi said Nigerian airlines might not benefit from the liberalised market because Nigerian may not have prepared itself to take advantage of such opportunity.

“I don’t think Nigerian airlines can benefit from it because if you look at operating environment of airlines in Africa, which African country is aviation being run the way we run it in Nigeria now? The major carriers are being run by their governments and the respective governments would push for liberalisation. If those airlines were run by individuals then we can now be talking about open skies.

“In Nigeria we have airlines that are not subsidized; they are run as private concerns and they are not getting any fund from government, so it will be difficult to compete with another airline receiving funds from government,” Sanusi said.

However, Nigeria is one of the signatories that will start the implementation of liberalised African airspace in 2017.

However, IATA has published, delivered seminars and sensitised African air transport industry on the immense gains inherent in the liberalisation of African airspace.

Aviation experts said one of the drawbacks to air transport growth in the continent is political boundary as every nation has one immigration barrier or another, all geared towards preventing their neighbor countries from gaining access to their countries. Besides retarding air transport growth, it has also stultified economic development of the region because it has been shown that by trading among themselves, African nations could boost capital formation among African states and empower the citizenry economically. But what has been prevalent is that monies earned in Africa are moved to Europe, Asia and America where they are exchanged for goods.

IATA has disclosed that enhanced intra Africa air connectivity would generate 17,400 jobs and add about $128.2 million annually to Nigeria’s Gross Domestic Product (GDP).
This means that a Nigerian airline can operate from Lagos to Lome and Lome to Dakar without visa and immigration restrictions. It is expected that this would boost intra continental trade and make more people travel in the continent.

The liberalisation of the airspace or open sky for Africa is the offshoot of the Yamoussoukro Decision, which African states agreed on and ratified and about 21 states will start implementing the policy in 2017.

But it is not yet a smooth ride for some countries and some airlines, which feel that they are being shortchanged in the whole arrangement. While well-established airlines that have thrived for decades and have developed network are enthusiastic to see the policy implemented.

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