Payment of airlines’ FX funds top priority for new govt. – ASRTI chief
By Sade Williams/Business a.m.
Nigeria’s incoming government has been advised to make the payment of the trapped funds of foreign airlines top priority in order to encourage and attract more investors into the sector.
Gabriel Olowo, president, Aviation Safety Round Table Initiative (ASRTI), gave the advice in an interview, and said the trapped funds, now estimated to be in excess of $743 million, had in recent times, portrayed Nigeria as a country that does not respect international trade laws and the sanctity of contracts.
Nigeria must show that it will shore up investors’ confidence and not the other way round, said Olowo.
“The priority of the incoming government should be first, to pay all the trapped funds to the foreign airlines to zero if you want that sector to flourish so that all the inventories will come back. This is to prove that we respect international trade.
“Also, you cannot be begging the airlines to die. Where do you want me [them] to get fuel to bring my [their] aircraft down here when all the money is kept in Nigeria? Do you expect them to go and borrow to operate their aircraft into Nigeria? Maintenance is due every six months, where do you want me [them] to get the money from? Do we have maintenance facilities here in the country, which can force the airlines to do their heavy check maintenance here? What is the capacity of the maintenance? And if I am [they are] lifting fuel in Nigeria, what capacity will I [they] lift at a time? So, the government should pay the debts instantly to zero and tell the world that we are ready to shore up investors’ confidence,” he said.
According to Olowo, Richard Branson, the founder of Virgin Atlantic, succeeded in other countries but not in Nigeria because of breaches of contract and lack of respect for international trade.
“Sir Richard Branson is one of the most successful airline operators in the globe. The airline succeeded in the United Kingdom with Virgin UK, Virgin US, Virgin Australia and Virgin Blue. Virgin came here with Virgin Atlantic, but it ran back. Why? It was because of the sanctity of contract [issues]. Don’t sign what you cannot do. And while Branson was leaving, he issued a bad statement by saying ‘Nigeria is a business destroyer.’
“We need to shore up investors’ confidence in Nigeria. This is key and it is a foundation to progress in every sector of the economy. Nigeria must honour contracts and this accumulation of foreign airlines’ funds is one of the major breaches that we have as of today in the country,” Olowo added.
Speaking further on what the new government should do, Olowo said there is a need to have a new international airport terminal, saying that the old one is overstretched.
“Secondly, let’s deliver a modern gateway. The international terminal at the Lagos airport is overstretched, it has expired and we need to shut it down. Strip it 100 percent and rebuild. The plan for that airport is A,B,C,D, E fingers. We have been parading D and E since 1978, which is 45 years now. What happens to A, B, C fingers? Let’s go and build A, B, C and when that is ready, you can move in there and strip the D and E so that they can join later.
“Then, we can add an aerotropolis to it. Aerotropolis will extend to Ikeja. That is what you have in Turkey and Dubai with light rail that will take you to different gates, which is known as concusses. And in doing this, we are not looking for government money; private investors will do it. We have to demonstrate consistency. Master plans must go beyond eight years. There must be continuity so that investors will see us as a country that is ready to do business,” he added.