Nigeria, on Monday, took a major step towards establishing a new national airline with the inauguration of a committee in Abuja to look into the issue.

A press statement issued by the Ministry of Aviation said Permanent Secretary Hajya Binta Bello charged the Ministerial Committee on the Establishment of a National Carrier to pursue the assignment with vigor in view of its national importance.

Ms. Bello said the inauguration of the Committee became imperative in view of the interest shown in the venture by President Muhammadu Buhari and his recent marching directives to the Ministry to immediately commence the process of establishing one

“Hajiya Binta Bello said the establishment of a national carrier is not only justified by economic considerations, but also strategic national interest, national pride and job creation potentials,” the Ministry said.

Captain Mohammed Abdulsalam, a former Managing Director of Discovery Airlines will serve as the chairman of the panel. It is tasked with reviewing previous Consultants’ submissions and recommendations on a National Carrier, and reviews the report on the failure of the defunct Nigeria Airways and other failed private airlines.

The Committee is also mandated to consult widely with stakeholders, including interested international partners, on the establishment of a National Carrier on a Public-Private Partnership model.

The Permanent Secretary also charged the Committee to invite the Assets Management Corporation of Nigeria (AMCON) to determine the debt profile of domestic airlines to serve as a guide in its recommendations, and to develop the optimum model for a National Carrier for Nigeria.

Responding on behalf of other members, Captain Mohammed Abdulsalam regretted the issues that led to collapse of the defunct Nigeria Airways and promised that they would develop an economically robust model that would stand the test of time and meet the aspirations of Nigeria as a nation.

The Ministerial Committee on the Establishment of a National Carrier will report in four weeks.
http://saharareporters.com/2015/08/24/establishment-new-national-airline-government-sets-committee

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Having read some expert arguments for/against the establishment of a national carrier, I'm firmly in favor of setting one up.
But the FG, shouldn't have majority equity in the airline; it should be a private-sector driven carrier. Arik air's proposed IPO, which will open up ownership stakes of the airline to the public, may be a move on their part to get the FG to designate the airline as a flag-carrier.

EgusiSoup:
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space booker

See another FP booker

CFCman:

space booker

PMB knows Nigeria well

We are getting there, slowly but surely.

I may not be an APC fan but you just know a government that is serious when you see one. I've followed Buhari's gradual steps at fixing Nigeria and he seems to be touching areas that have beem expected of him. In a year time, we may start seeing the results.

CFCman:
Having read some expert arguments for/against the establishment of a national carrier, I'm firmly in favor of setting one up.
But the FG, shouldn't have majority equity in the airline; it should be a private-sector driven carrier. Arik air's proposed IPO, which will open up ownership stakes of the airline to the public, may be a move on their part to get the FG to designate the airline as a flag-carrier.

I'll like to know what the likes of kenya Airways, South African Airways and Ethiopia airways are doing. That's exactly what we should be doing.

Buhari is so keen on chasing shadows.

Afam4eva:

I'll like to know what the likes of kenya Airways, South African Airways and Ethiopia airways are doing. That's exactly what we should be doing.

Ethiopian and SAA are wholly govt owned, but they are run as a corporation. Their national governments do not interfere in business or technical issues; and civil service rules are not applied to the airlines.

Kenyan govt only has 29% shares Kenyan airways. The rest are held by KLM, and individuals.

CFCfan:

Ethiopian and SAA are wholly govt owned, but they are run as a corporation. Their national governments do not interfere in business or technical issues; and civil service rules are not applied to the airlines.

Kenyan govt only has 29% shares Kenyan airways. The rest are held by KLM, and individuals.

We know government has failed us in the past but i'm not one of those who agree with the long held notion that government should not be in business. If you have a government that is responsible then it can own 100% in my opinion. if NNPC can be made to work, i don't see why a national carrier can't. it can be run as an independent corporation as opposed to a government parastatal.

Afam4eva:

We know government has failed us in the past but i'm not one of those who agree with the long held notion that government should not be in government. If you have a government that is responsible then it can own 100% in my opinion. if NNPC can be made to work, i don't see why a national carrier can't. it can be run as an independent corporation as opposed to a government parastatal.

The government corporation idea is fine, but the question is this: will Nigerian government officials resist the urge to interfere in its day to day running? Or will the elite welcome the idea of a govt corp instead of a parastatal?

I do rather fly on private owned airline than fly on Nigeria government owned airline. Nigeria government and carelessness works hand in hand.

I'm of the opinion that government should not in any way operate any business. Empirical evidence shows that government have always been bad managers of businesses. Going that route again is a recipe for disaster. While I do agree that we need a national airline, I disagree with it being 100% government operations. I think government can help with the set up and initial lift off, and there after, pave way for strategic public listing.

The strategic industry can help reduce pressure on our foreign exchange, create local jobs and help improve our human resources (management experience).

courage89:
I'm of the opinion that government should not in any way operate any business. Empirical evidence shows that government have always been bad managers of businesses. Going that route again is a recipe for disaster. While I do agree that we need a national airline, I disagree with it being 100% government operations. I think government can help with the set up and initial lift off, and there after, pave way for strategic public listing.

The strategic industry can help reduce pressure on our foreign exchange, create local jobs and help improve our human resources (management experience).

The committee chairman was formerly with Discovery Airlines that has packed up?

Afam4eva:
I may not be an APC fan but you just know a government that is serious when you see one. I've followed Buhari's gradual steps at fixing Nigeria and he seems to be touching areas that have beem expected of him. In a year time, we may start seeing the results.

It will be great for all of us if he continues with this kind of zeal and seriousness throughout his tenure.

A very good idea....with the establishment of a national carrier, plenty pilots, aeronautical engineers, aircraft maintenance engineers, flight attendants, and other technical and support staff would be recruited, thus creating employment...but I want the airline to be independent of any Minister of aviation or any ministry whatsoever....in the sense that whomever wanna fly the airline must pay for the ticket cos Dats what killed the defunct Nigerian airways

zik4ever:
The committee chairman was formerly with Discovery Airlines that has packed up?

At least, he has some experience in airline management.

It will be nice for the committee to publish the reports they were asked to dust up and work with, so that meaningful contributions will be made on the optimal ownership, operational and management model by informed members of the public.

Nevertheless government must not own more than 49% of the equity. That way irresponsible officials will never be in a position to crash the airline. But government must be involved for the initial take off, but can then divest when the new company is on autopilot (if you catch my drift)

The article below is yet another perspective on the structure of the proposed carrier:
http://leadership.ng/opinions/459816/national-carrier-as-national-pride

It is unfortunate that because we have no national carrier, foreign airlines repatriate above N400 billion annually to their respective countries from ticket sales in Nigeria, while 26 foreign airlines operating in Nigeria offer 2,316,288 aircraft seats to the Nigerian international travel market every year. Their Nigerian counterparts offer only 202,228 seats i.e. about 10% of their foreign counterparts with 17weekly flights. Nigeria airlines operating international routes account for only 8% of the 11,383 annual international flights in the country.

I have understudied the traffic inflow from Nigeria to London return and also from Nigeria to Dubai. I have also calculated how much foreign airlines make from airlifting pilgrims to Saudi Arabia and Jerusalem and these are the facts: 142, 000 Nigerians visited UK in 2012, now if you calculate at economy rate of £650 for a return ticket , at an exchange rate of N302 to £I, it gives you about N27.8BN. Similarly, about N25bn was expended for purchase of air tickets to Dubai in 2012. The total pilgrims that performed hajj in 2012 were 95,000 at rate of N157,000.00 per ticket, giving you a figure of N13, 015, 000,000. 00. On the other hand, a total number of 30, 000 travelled to Jerusalem at N152, 766.00 for a ticket giving you the sum of N4.6 billion.

I have not done the calculation, but if we put other variables like the total number of staff to be employed by our national carrier, equipping and maintaining national carriers in the fleet if you add these to N400bn capital flight and others, you are likely to emerge with a figure close to N500bn, imagine what that figure will do to our economy.

It is in this context that the call for a national carrier has becomes inevitable. Bearing in mind the fiasco of Nigeria airways, it is imperative that the factors that precipitated the collapse of the Nigeria Airways be x-rayed. Similarly, the factors that led to the success story of other airlines earlier mentioned must be assimilated, putting our various peculiarities in context.

For an effective, efficient and profitable national carrier, it wouldn’t be out place to incorporate the following tips: The three tiers of government, banks, corporate bodies, well known business men such as Dangote, Mike Adenuga etc. should float a company for the purpose of bringing in existence a national carrier. The three tiers of government may collectively look for on and off shore facilities to be syndicated by our local banks. It could also use part of the sovereign national wealth fund (SWF) to contribute 51% of equity share. The three tiers of government should use a formula to distribute shares to each federating unit depending on its contribution while the corporate world including banks and reputable companies should contribute 40% and then the balance should be listed on the stock market, to be bought by the general public.

The established company should look for technical partners, an airline that has proven its mettle in the aviation industry with outstanding performance. The company will not only provide technical services, but should enter into an alliance with our national carrier.

In view of the past experiences with the collapsed Nigeria Airways, government should have no business in running the airline. The corporate bodies involved in the project and the technical partners should provide a sound management team. The government should only be involved by allowing the ministries of Finance and Aviation to be on the board of directors for the purpose of protecting the investment of government in the project.

The management, especially the CEO should preferably be a foreigner with track record of performance in the aviation industry and should possibly be sourced from the technical partners or outside. Note that this CEO will only be in place for the duration of the airline’s infancy, after which a Nigerian should be appointed. When Dubai established Emirates Airlines 29 years ago, it appointed one Maurice Flanagan who worked with BA and Gulf Air as its first CEO.

There is the need to merge the present Arik into the new company with its assets and liabilities computed and worked out as its share in the new company. Its staff should be screened and suitable ones retained while the ones that can’t fit into the new company be paid off.

Good

The Federal Government's part of the PPP model should be restricted to "sovereign cover" for the airline. I now believe Arik Air (merging with one or two other local airlines) can be designated as the new national carrier. But it should still be listed on the stock market.