By Udeme Clement
AirlineÂ Operators of Nigeria (AON), has called for a new payment structure that would enable local airlinesÂ indebted to their creditors to pay off between now and 2020, in order to stay afloat in business.
The Assistant Secretary General of AON, Muhammed Tukur, made this known in a chat withÂ Vanguard, in Lagos .He explained, â€œAt present, local airlines doing business in Nigeria are facing a lot of challenges, ranging from low passenger traffic to heavy debt burden.
So, paying the money periodically up to 2020, would allow such airline operators sufficient time to put their resources together to continue their operations unhindered. This is because paying the outstanding debts once may be difficult considering other financial commitments they have to handleâ€.
Tukur, noted, â€œThe truth is that local airlines are not only indebted to government, but also commercial banks and oil companies that they transacted business with over the years. This means they should be given time to settle their debt while they still carry out their operations smoothly.â€
The Assistant Secretary General of AON, stressed, â€œinfact, this is a very challenging period for domestic airlines in the country, because the problem has been further compounded by the on-going shake-up in the banking sector.
â€œWith what is happening in the banking industry now, it would be difficult for commercial banks to give credit facilities to domestic airlines to expand their operations. Also, before now, most oil marketers used to supply aviation fuel on credit to airlines to run their operations, but such practice is no longer obtainable because of the debt issue.
The oil marketers themselves are complaining of financial constraint, since they are also owing banks a lot of money. So, what is required is a complete restructuring of the industry debt to make it viableâ€.