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‘We must learn from past’ — airline operators oppose Ethiopian Air’s stake in Nigeria Air

‘We must learn from past’ — airline operators oppose Ethiopian Air’s stake in Nigeria Air
October 21
23:23 2022

Airline Operators of Nigeria (AON), an umbrella body for local carriers, have kicked against the majority stake held by Ethiopian Airlines (ET) consortium in Nigeria Air — the country’s national carrier.

At an interactive session with members of the house of representatives committee on aviation on Thursday, Allen Onyema, chief executive officer of Air Peace, who doubles as vice-president of AON; and Roland Iyayi, a member of AON, said ET’s investment will affect the progress of local airline operators.

ET was recently selected as the preferred bidder for Nigeria Air, after scoring 89 percent out of 100 in the technical bidding process and 15 out of 20 as regards financial bids.

The airline is to own 49 percent of the national carrier.

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On Monday, President Muhammadu Buhari said the establishment of the national carrier is at 91 percent completion and is expected to commence flight operations by December.

However, AON has insisted that Nigeria Air should be a “wholly Nigerian investment”.

“In this Nigeria carrier, a lot of us are disagreeing. We need to be carried along,” Onyema said.

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The Air Peace CEO said local operators, including the “smallest ones”, have been invited by other countries to invest in their national carriers, but with high demands.

“When you go there you will see a country of less than three million people telling you to do cash injection. A country of three or four million population telling you to bring $100 million cash to be deposited in their country because you are going to earn their grandfather rights to start flying to other countries,” he said.

“If this is the case, Nigeria with its strategic geographical location — and of course, mobile population — how much is Ethiopia going to put on the ground?

“The fear of AON is that Ethiopia has tried in doing everything possible to access the Nigerian market both frontally and from behind.

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“We even want the federal government and patriotic Nigerians to fund this airline. Let it be a wholly Nigerian investment because the way Ethiopia is coming in will not benefit Nigeria.”

While highlighting the effects ET’s investment will have on local airlines, Onyema noted that it would be “better” if Nigeria picks another partner.

“I would rather prefer Nigeria Air to look for another partner. We have so many Nigerians, let’s market it to them so that we can conserve our money for ourselves,” he said

“The manner Ethiopia is coming into the arrangement for Nigeria Air could cause existential problems for indigenous airlines.

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“We do not want Ethiopian Airlines to come in and ravage our country.”

On his part, Iyayi said ET’s involvement in the Nigeria Air project was “ill-advised”.

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“We might say we want to create something and ultimately destroy what we have and that is the major concern of AON. The partnership with Ethiopian Airlines for us, we consider it ill-advised for a variety of reasons,” he said.

“The domestic carriers do not have the same luxury. Domestics operators in Nigeria are operating in the most hostile of environments you can imagine for any airline company.

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“If the Nigeria Air project is subjected to the same conditions of the current operators in the same domestic market, it will fail. If you allow the same situation that Nigerian airlines are exposed to, to happen with Nigerian air, Nigeria Air will fail ab initio. We need to learn from the past.”

LAWMAKERS QUERY ETHIOPIAN-NIGERIAN AIRLINE PARTNERSHIP

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Meanwhile, members of the committee also raised concerns that Ethiopian Air has a 49 percent investment in the national carrier.

Nnolim Nnaji, chairman of the committee, said some Nigerians are worried about the ownership model of Nigeria Air.

He said Ethiopia is a rival to Nigeria and that the ownership structure may not favour the country.

But Hadi Sirika, minister of aviation, said all stakeholders in the Nigerian aviation sector were allowed to participate in the establishment of the national carrier.

“From all the submissions we received, we have identified partners and investors and we are currently negotiating and processing the air operator certificate (AOC),” he said.

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